Small Business Tax Deduction Checklist (2026)
Stop overpaying the IRS. This checklist covers 100+ legitimate tax deductions available to sole proprietors, single-member LLCs, partnerships, and S-Corps. Every dollar you deduct reduces your taxable income. Print this page, go through each category, and make sure you are not leaving money on the table.
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Home Office Deductions
You must use a dedicated space in your home regularly and exclusively for business. Choose the simplified method or actual expense method (not both).
| Deduction | What Qualifies | IRS Reference | |
|---|---|---|---|
| Simplified method | $5 per sq ft of office space, up to 300 sq ft ($1,500 max) | Schedule C, Line 30 | |
| Mortgage interest (business %) | Portion of mortgage interest based on office square footage percentage | Form 8829, Line 10 | |
| Rent (business %) | Portion of rent if you rent your home, based on office square footage | Form 8829, Line 19 | |
| Property taxes (business %) | Proportional share of real estate taxes for your home office space | Form 8829, Line 11 | |
| Homeowner's / renter's insurance | Business percentage of your home insurance premium | Form 8829, Line 18 | |
| Utilities | Electric, gas, water, trash — business percentage of total | Form 8829, Line 21 | |
| Home repairs & maintenance | General repairs (whole house) deducted at business %; office-only repairs at 100% | Form 8829, Lines 22-23 | |
| Home depreciation | Depreciation of home value (not land) at business percentage over 39 years | Form 8829, Line 29 | |
| Security system | Business portion of alarm monitoring and equipment for home office | Form 8829 | |
| Pest control | Business percentage of pest control services for the home | Form 8829 |
Vehicle & Transportation
Choose standard mileage rate or actual expenses for each vehicle. Keep a mileage log either way. Commuting miles are never deductible.
| Deduction | What Qualifies | IRS Reference | |
|---|---|---|---|
| Standard mileage rate | 70 cents per mile (2026 rate) for business miles driven | Schedule C, Line 9 | |
| Gas & oil (actual method) | Fuel costs proportional to business use percentage of vehicle | Form 4562 / Schedule C | |
| Vehicle insurance | Business-use portion of auto insurance premiums | Schedule C, Line 15 | |
| Vehicle repairs & maintenance | Oil changes, tires, brakes — business-use portion | Schedule C, Line 9 | |
| Vehicle depreciation | Annual depreciation based on business-use percentage (MACRS) | Form 4562 | |
| Lease payments | Business portion of vehicle lease payments | Schedule C, Line 20a | |
| Parking fees | Business-related parking (client meetings, job sites) — not commuting | Schedule C, Line 27a | |
| Tolls | Tolls incurred while traveling for business purposes | Schedule C, Line 27a | |
| Registration & license fees | Business-use portion of annual vehicle registration | Schedule C | |
| Rideshare & taxis | Uber, Lyft, taxis for business travel (not commuting) | Schedule C, Line 27a | |
| Public transit | Bus, subway, train fares for business trips | Schedule C, Line 27a |
Health & Insurance
Self-employed individuals can deduct health insurance premiums as an adjustment to income (not on Schedule C). Business insurance goes on Schedule C.
| Deduction | What Qualifies | IRS Reference | |
|---|---|---|---|
| Health insurance premiums | Medical, dental, and vision for you, spouse, and dependents (self-employed) | Form 1040, Line 17 | |
| Dental insurance | Dental plan premiums for self-employed and family | Form 1040, Line 17 | |
| Vision insurance | Vision plan premiums for self-employed and family | Form 1040, Line 17 | |
| Long-term care insurance | Age-based premium limits; must be qualified LTC policy | Form 1040, Line 17 | |
| General liability insurance | Protects business from third-party claims of injury or damage | Schedule C, Line 15 | |
| Professional liability (E&O) | Errors & omissions coverage for professional services | Schedule C, Line 15 | |
| Business owner's policy (BOP) | Combined general liability and commercial property insurance | Schedule C, Line 15 | |
| Workers' compensation | Required coverage for employees in most states | Schedule C, Line 15 | |
| Disability insurance | Business overhead expense (BOE) disability policies only | Schedule C, Line 15 | |
| Cyber liability insurance | Coverage for data breaches and cyber attacks on your business | Schedule C, Line 15 | |
| Commercial auto insurance | Insurance for business-owned vehicles (not personal vehicles) | Schedule C, Line 15 |
Retirement Contributions
Retirement contributions reduce your taxable income and grow tax-deferred. Contribution limits vary by plan type and net self-employment income.
| Deduction | What Qualifies | IRS Reference | |
|---|---|---|---|
| SEP-IRA contributions | Up to 25% of net SE income, max $70,000 (2026). Deadline: tax filing date + extensions | Form 1040, Line 16 | |
| Solo 401(k) — employee deferral | Up to $23,500 (2026) as employee; $31,000 if age 50+ | Form 1040, Line 16 | |
| Solo 401(k) — employer contribution | Up to 25% of net SE income on top of employee deferral, combined max $70,000 | Form 1040, Line 16 | |
| SIMPLE IRA | Employee deferral up to $16,500 (2026); employer match up to 3% | Form 1040, Line 16 | |
| Traditional IRA | Up to $7,000 ($8,000 if 50+); deductibility depends on income and plan coverage | Form 1040, Line 20 | |
| HSA contributions | $4,300 individual / $8,550 family (2026) if enrolled in HDHP | Form 8889 → Form 1040, Line 13 |
Office & Supplies
Ordinary and necessary expenses for running your workspace. Items over $2,500 may need to be depreciated unless you elect the de minimis safe harbor.
| Deduction | What Qualifies | IRS Reference | |
|---|---|---|---|
| Office rent | Rent for dedicated office, co-working space, or studio | Schedule C, Line 20b | |
| Office utilities | Electric, water, internet, phone for a separate office space | Schedule C, Line 25 | |
| Office supplies | Paper, pens, ink, toner, sticky notes, folders, envelopes | Schedule C, Line 22 | |
| Postage & shipping | Stamps, FedEx, UPS, USPS costs for business mailings | Schedule C, Line 27a | |
| Furniture | Desks, chairs, shelving, filing cabinets (Section 179 if over $2,500) | Schedule C, Line 22 / Form 4562 | |
| Equipment | Printers, scanners, copiers, shredders for business use | Schedule C, Line 22 / Form 4562 | |
| Cleaning & janitorial | Cleaning services for your business office space | Schedule C, Line 27a | |
| Office repairs | Repairs and maintenance for leased or owned office space | Schedule C, Line 21 |
Technology & Software
Software subscriptions are fully deductible in the year paid. Hardware over $2,500 can be expensed under Section 179 or depreciated.
| Deduction | What Qualifies | IRS Reference | |
|---|---|---|---|
| Computers & laptops | Business-use percentage of purchase price; Section 179 for full expensing | Form 4562 / Schedule C | |
| Tablets & monitors | iPads, external displays, and peripherals used for business | Schedule C, Line 22 | |
| Cell phone | Business-use percentage of phone cost and monthly plan | Schedule C, Line 25 | |
| Internet service | Business-use percentage of home or office internet | Schedule C, Line 25 | |
| Business phone line | Dedicated business phone or VoIP service — 100% deductible | Schedule C, Line 25 | |
| Accounting software | QuickBooks, Xero, FreshBooks, Wave subscriptions | Schedule C, Line 27a | |
| Project management tools | Asana, Monday, Basecamp, Notion, Trello subscriptions | Schedule C, Line 27a | |
| CRM software | Salesforce, HubSpot, Pipedrive and similar tools | Schedule C, Line 27a | |
| Cloud storage & hosting | Dropbox, Google Workspace, AWS, web hosting | Schedule C, Line 27a | |
| Design & creative tools | Adobe Creative Cloud, Canva Pro, Figma subscriptions | Schedule C, Line 27a | |
| Domain names & SSL | Annual domain registration and SSL certificate costs | Schedule C, Line 27a | |
| Cybersecurity tools | VPN, antivirus, password managers for business use | Schedule C, Line 27a |
Marketing & Advertising
All ordinary and necessary marketing expenses are deductible. This includes digital marketing, print materials, and promotional items.
| Deduction | What Qualifies | IRS Reference | |
|---|---|---|---|
| Online advertising | Google Ads, Facebook/Meta Ads, LinkedIn Ads, TikTok Ads | Schedule C, Line 8 | |
| Website design & development | Costs to build, redesign, or maintain your business website | Schedule C, Line 8 | |
| SEO services | Search engine optimization, keyword research, link building | Schedule C, Line 8 | |
| Social media management | Scheduling tools, freelancer fees, content creation for social | Schedule C, Line 8 | |
| Email marketing | Mailchimp, ConvertKit, ActiveCampaign and similar platforms | Schedule C, Line 8 | |
| Business cards & stationery | Printed cards, letterhead, branded envelopes | Schedule C, Line 8 | |
| Print advertising | Newspaper, magazine, flyer, and direct mail campaigns | Schedule C, Line 8 | |
| Promotional items | Branded merchandise, giveaways, samples given to clients | Schedule C, Line 8 | |
| Signage | Business signs, banners, vehicle wraps, window decals | Schedule C, Line 8 | |
| Sponsorships | Sponsoring local events, sports teams, or community programs | Schedule C, Line 8 | |
| Photography & videography | Professional photos or videos for marketing materials | Schedule C, Line 8 |
Travel
Business travel must be primarily for business. Meals are 50% deductible in most cases. Keep receipts and document the business purpose of every trip.
| Deduction | What Qualifies | IRS Reference | |
|---|---|---|---|
| Airfare | Flights for business trips (coach class is safest deduction) | Schedule C, Line 24a | |
| Hotels & lodging | Hotel, Airbnb, or other lodging during business travel | Schedule C, Line 24a | |
| Meals (50%) | Business meals while traveling; 50% deductible. Must document who, where, and business purpose | Schedule C, Line 24b | |
| Rental cars | Car rentals during business travel, including fuel and insurance | Schedule C, Line 24a | |
| Baggage fees | Checked bag fees, overweight charges for business trips | Schedule C, Line 24a | |
| Tips | Tips to porters, bellhops, hotel staff during business travel | Schedule C, Line 24a | |
| Dry cleaning on trips | Laundry and dry cleaning while on extended business travel | Schedule C, Line 24a | |
| Wi-Fi on planes/trains | In-transit internet access purchased for business use | Schedule C, Line 24a | |
| Client entertainment meals | Meals with clients or prospects to discuss business (50%) | Schedule C, Line 24b | |
| Per diem (alternative) | Federal per diem rates instead of tracking actual meal/lodging costs | Publication 1542 |
Professional Services
Fees paid to professionals for business-related services are fully deductible in the year paid.
| Deduction | What Qualifies | IRS Reference | |
|---|---|---|---|
| Accounting & tax prep | CPA fees, tax preparation, bookkeeping services, payroll processing | Schedule C, Line 17 | |
| Legal fees | Attorney fees for business contracts, entity formation, disputes | Schedule C, Line 17 | |
| Bookkeeping services | Monthly bookkeeping, reconciliation, financial statement prep | Schedule C, Line 17 | |
| Consulting fees | Business consultants, strategists, fractional CFOs | Schedule C, Line 11 | |
| Payroll services | ADP, Gusto, Paychex and similar payroll processing fees | Schedule C, Line 17 | |
| Business coaching | Coaches and mentors hired to improve business performance | Schedule C, Line 27a | |
| Virtual assistant | VA services for admin, scheduling, and business support | Schedule C, Line 11 | |
| IT support | Managed IT services, tech support contracts, network maintenance | Schedule C, Line 27a |
Education & Training
Education expenses are deductible when they maintain or improve skills required in your current business. Education that qualifies you for a new career is not deductible.
| Deduction | What Qualifies | IRS Reference | |
|---|---|---|---|
| Online courses | Udemy, Coursera, LinkedIn Learning — must relate to current business | Schedule C, Line 27a | |
| Conferences & seminars | Registration fees, travel, and lodging for industry events | Schedule C, Line 27a | |
| Workshops & masterminds | Paid workshops, group coaching, and mastermind memberships | Schedule C, Line 27a | |
| Books & publications | Business, industry, and professional development books | Schedule C, Line 27a | |
| Professional certifications | Exam fees and study materials for industry certifications | Schedule C, Line 27a | |
| Continuing education (CE/CPE) | Required continuing education credits to maintain licenses | Schedule C, Line 27a | |
| Trade journal subscriptions | Industry magazines, newsletters, and research subscriptions | Schedule C, Line 27a | |
| Webinar & training platform fees | Zoom, GoToWebinar, or training platform subscriptions for learning | Schedule C, Line 27a |
Employees & Contractors
Wages and contractor payments are your largest deductions if you have a team. File 1099-NEC for any contractor paid $600+ in a year.
| Deduction | What Qualifies | IRS Reference | |
|---|---|---|---|
| Employee wages | Gross wages, salaries, bonuses, and commissions paid to employees | Schedule C, Line 26 | |
| Employer payroll taxes | Employer share of Social Security (6.2%) and Medicare (1.45%) | Schedule C, Line 23 | |
| State unemployment (SUTA) | State unemployment insurance premiums | Schedule C, Line 23 | |
| Federal unemployment (FUTA) | 6% on first $7,000 of each employee's wages (minus SUTA credit) | Form 940 | |
| Employee benefits | Health insurance, retirement plan contributions, group life insurance | Schedule C, Line 14 | |
| Contractor payments (1099-NEC) | Freelancers, consultants, and subcontractors paid $600+ | Schedule C, Line 11 | |
| Temporary staffing | Fees paid to staffing agencies for temporary workers | Schedule C, Line 11 | |
| Employee training | Training programs, onboarding costs, skill development for staff | Schedule C, Line 27a | |
| Employee gifts | De minimis gifts (generally under $25 per person per year) | Schedule C, Line 27a | |
| Recruiting & hiring | Job postings, background checks, recruiter fees | Schedule C, Line 27a |
Financial Expenses
Bank fees, interest on business loans, and payment processing costs are all deductible operating expenses.
| Deduction | What Qualifies | IRS Reference | |
|---|---|---|---|
| Business bank fees | Monthly maintenance, wire transfer, and check order fees | Schedule C, Line 27a | |
| Business loan interest | Interest on loans used for business purposes (not principal) | Schedule C, Line 16a | |
| Business credit card interest | Interest on credit card balances for business purchases only | Schedule C, Line 16a | |
| Merchant processing fees | Stripe, Square, PayPal transaction fees on business sales | Schedule C, Line 27a | |
| Credit card annual fees | Annual fee on business credit cards used for business | Schedule C, Line 27a | |
| Bad debts | Business debts that become worthless and uncollectible (accrual basis) | Schedule C, Line 27a / Form 1040, Sch D | |
| Late payment penalties | Penalties paid to vendors for late business payments (not IRS penalties) | Schedule C, Line 27a | |
| Safe deposit box | Rental of safe deposit box for storing business documents | Schedule C, Line 27a | |
| Bookkeeping & invoicing tools | Invoice software, receipt scanning, expense tracking platforms | Schedule C, Line 27a |
Depreciation & Amortization
Large purchases can be expensed immediately (Section 179, bonus depreciation) or spread over their useful life. Consult your tax advisor for the best strategy.
| Deduction | What Qualifies | IRS Reference | |
|---|---|---|---|
| Section 179 expensing | Immediately deduct full cost of qualifying equipment up to $1,250,000 (2026) | Form 4562, Part I | |
| Bonus depreciation | First-year bonus depreciation on new and used property (phase-down schedule applies) | Form 4562, Part II | |
| MACRS depreciation | Standard depreciation over asset life: 5 yr (computers), 7 yr (furniture), 39 yr (buildings) | Form 4562, Part III | |
| Vehicle depreciation | Annual limits apply; luxury auto caps for passenger vehicles | Form 4562 | |
| Amortization of startup costs | Deduct $5,000 immediately, amortize remainder over 15 years (180 months) | Form 4562, Part VI | |
| Organizational costs | $5,000 immediate deduction for LLC/corp formation; amortize excess over 15 years | Form 4562, Part VI | |
| Patent & trademark amortization | Costs to obtain patents, trademarks, or copyrights amortized over 15 years | Form 4562, Part VI | |
| De minimis safe harbor election | Expense items under $2,500 each (or $5,000 with audited financials) immediately | Statement attached to return |
Miscellaneous Deductions
These commonly overlooked deductions can add up. Make sure you are tracking all business-related expenses throughout the year.
| Deduction | What Qualifies | IRS Reference | |
|---|---|---|---|
| Professional dues & memberships | Industry associations, chambers of commerce, professional orgs | Schedule C, Line 27a | |
| Business licenses & permits | State, city, and county business licenses and operating permits | Schedule C, Line 23 | |
| Regulatory fees | State filing fees, annual reports, franchise taxes | Schedule C, Line 23 | |
| Subscriptions | Business-related SaaS tools, news services, data providers | Schedule C, Line 27a | |
| Charitable contributions (C-Corp only) | Donations to qualified 501(c)(3) orgs; sole proprietors deduct on Schedule A | Form 1120, Line 19 | |
| Self-employment tax (50%) | Deduct half of SE tax as adjustment to income. Calculated on Schedule SE | Form 1040, Line 15 | |
| Moving expenses (military only) | Active-duty military moving for permanent change of station | Form 3903 | |
| Business gifts | Up to $25 per recipient per year; keep records of who and why | Schedule C, Line 27a | |
| Tax preparation software | TurboTax, H&R Block, TaxAct — business portion of cost | Schedule C, Line 27a | |
| Uniforms & work clothing | Clothing required for work that is not suitable for everyday wear | Schedule C, Line 27a | |
| Research & development | R&D costs for developing new products or processes (may qualify for R&D credit too) | Schedule C, Line 27a / Form 6765 | |
| QBI deduction (Section 199A) | Up to 20% of qualified business income for pass-through entities | Form 8995 or 8995-A |
How to Use This Checklist
- Print this page — use the browser print function or Ctrl+P. The print layout hides navigation and email forms automatically.
- Go through each category and check off every deduction that applies to your business for the tax year.
- Gather documentation — receipts, bank statements, mileage logs, and contracts for each checked item.
- Organize by Schedule C line — group your expenses by the IRS form reference to make filing faster.
- Consult a tax professional — this checklist is educational. A CPA or enrolled agent can maximize your deductions based on your specific situation.
Disclaimer: This checklist is for informational purposes only and does not constitute tax advice. Tax laws change frequently. Consult a qualified tax professional for advice specific to your situation. Last updated March 2026.
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