Are You Leaving Money on the Table? 5 Often Overlooked Tax Deductions At tax time, novice entrepreneurs will quickly find out just how complex the U.S. tax system is. But don't let that stop you from taking advantage of a few key tax deductions.

By Amrik Randhawa

Opinions expressed by Entrepreneur contributors are their own.


It's everyone's favorite time of year: tax time. For many types of businesses, the deadline is April 15. Yet for the rookie entrepreneur, knowing when to file is just step one in a typically arduous process.

For them, tax time often spells a whole new world of questions and challenges. From credits to capital losses, February through April of a business' first year usually results in more tax knowledge acquisition than any entrepreneur ever wanted to know. Yet there always seems to be "one more thing," -- particularly in the deductions department.

Below are a few of the most often overlooked business-tax deductions at the federal level. From the obvious to the obscure, this list is by no means comprehensive, yet it's a good start. For a more customized take, an accountant is your best resource.

Loan interest
If you took out a loan to get your operation up and running, there could be a deduction hidden in there. Usually, business owners will apply their entire loan payment against the loan balance. But in reality, a part of each payment should be denoted as your interest expense. Make sure that is adjusted. If it's not, you could be missing out on a sizeable tax deduction.

Related: The Year-End Accounting Missteps of Rookie Entrepreneurs

Bad debts
If you have outstanding invoices, do your best to try collect on them. If it's impossible to collect, you may be able to write off the bad debt and get a tax deduction. (This is one to run by your tax advisor, just to be sure.)

Amortization of intangible assets
Amor-what? Exactly. To clarify: Amortization is essentially the practice of deducting the cost of an intangible asset over its projected life. And what's an intangible asset? Well, if you bought things like logos, trademarks and customer lists, those are called intangible assets, or "goodwill." These can be amortized over a specific number of years, and can help lower your taxable income today.

Related: Why Mid-Year Tax Reviews Are a Must for First-Time Entrepreneurs

Business use of a personal vehicle
If you use your personal vehicle for business travel, don't forget to account for expenses like miles on the road and maintenance. Even the miles you drive to meet your accountant count.

Home office space
Most folks are aware of this one, but if you work from home it's possible to write off a portion of your home's utility, rent and other payments. This post from the IRS regarding the home-office deduction gives a comprehensive overview and links to the relevant forms.

Related: The Health-Care Law's Mandate: A Tax on Young Americans?

As mentioned, this isn't a comprehensive list. And as with all tax related issues -- especially deductions -- your accountant or business tax professional is your most valuable resource.

– Kashoo accounting expert Sandra Tomlinson contributed to this post.

What other tax tips would you suggest fellow entrepreneurs consider? Let us know in the comments section below.

Wavy Line
Amrik Randhawa

Product guy at Kashoo

Amrik Randhawa is a product guy at Kashoo: simple cloud accounting for small business, on the web and on the iPad.

Editor's Pick

She's Been Coding Since Age 7 and Presented Her Life-Saving App to Tim Cook Last Year. Now 17, She's on Track to Solve Even Bigger Problems.
I Helped Grow 4 Unicorns Over 10 Years That Generated $18 Billion in Online Revenues. Here's What I've Learned.
Want to Break Bad Habits and Supercharge Your Business? Use This Technique.
Don't Have Any Clients But Need Customer Testimonials? Follow These 3 Tricks To Boost Your Rep.
Why Are Some Wines More Expensive Than Others? A Top Winemaker Gives a Full-Bodied Explanation.

Related Topics

Business News

'All Hell Is Going to Break Loose': Barbara Corcoran Issues Warning About Real Estate Market, Interest Rates

The "Shark Tank" star appeared on FOX Business' "The Claman Countdown" this week.

Business News

This Is the Most Loved Company of 2023, According to a New Report

A new Axios and Harris Poll ranked the 100 most visible U.S. companies.


How I Made Money From My Book Without Selling a Single Copy

Did you know you can make money with a book without selling copies? Here's exactly how I did it.


Finding Your Brand Voice — How to Write Copy That Sounds Like You

Here's how to nail your brand voice so you can differentiate yourself and build your business in an authentic way.

Money & Finance

3 Ways to Create Multiple (Big) Streams of Income

Here are three ways to create multiple streams of income. These strategies require effort and resources but offer significant financial potential.

Business News

Lululemon Stock Surges After Strong Q1 Earnings Report, With Massive Earnings Overseas

The athleisure brand reported net revenue growth of 24% in the first quarter of 2023.