2022 Small Business Tax Deduction Checklist

A calculator and some pencils site atop a pile of US tax forms with a Post-It Note that reads "Need Help?"

Small business owners are already busy people, but that workload goes way up at tax time. Making sure that you're getting every tax deduction available to you is important, and tax laws and regulations are changing all the time. If you need some help navigating the new tax laws, our network of qualified, dedicated small business tax attorneys through our Small Business Legal Protection Plans can be a life saver that's within budget. Read on for a 2022 checklist for small business taxes:

Reducing Taxable Income

Tax deductions for businesses must be "ordinary and necessary," according to the IRS, which means that these are things that are common expenses for your industry and needed for you to do business. These include:

Health Care Tax Credits for Small Businesses

If you provide health insurance for fewer than 25 employees, you can deduct 50% of the costs of premiums, and smaller employers get a bigger credit than larger businesses.

Rent

You can deduct the entire cost of your rent for business use so long as you are not receiving title or equity to the property.

Depreciation

Equipment that you use day-to-day to run your business will lose value over its lifespan, and you can deduct that depreciation. You may need assistance from a CPA or tax lawyer to determine the rate of depreciation.

Insurance

Business insurance is 100% deductible.

Home Office

If you have a space in your home where you conduct business, you may be able to take a tax deduction for this square footage.

Transportation

Some professions require travel, and this includes driving time in your local area. The standard federal deduction for mileage is .58 cents per mile. You can also itemize these costs, and that requires keeping, recording, and tracking receipts of fuel, mileage (both personal and business related, if you're using your own vehicle), maintenance, parking, tolls, and more.

Advertising

Any costs related to advertising to attract business can be deducted, including marketing efforts for gaining or retaining clients. You cannot deduct the costs of lobbying.

Education

If you have paid for employee training or training for yourself, you can deduct those costs.

Office Supplies

Provided that you do not take inventory of office supplies at the beginning and end of the year, and that you do not keep records of when office supplies were used, and that taking the deduction doesn't make a huge change to your business income, you can deduct office supplies, such as printer inks and papers, writing utensils, software, cleaning supplies, and more.

Travel

Leaving town probably means additional costs, and these are calculated separately on your taxes. Fares for planes, trains, subways, rental cars, ride sharing services, taxis, hotels, food, and more are tax deductible so long as they are "ordinary and necessary," but you'll need to keep all your receipts.

Utilities

So long as you can prove that they were for business use, you can deduct the costs of your electricity, gas, heating, telephone, and more.

Costs of Startups

Some of the costs of starting your business may be tax deductible. There are additional deductions if you start an employee retirement plan.

Salaries and Benefits

You can deduct the costs of employee salaries, commissions, and bonuses.

Charitable Donations

Any cash donation made to a qualified organization can be deducted.

Business Meals

You can deduct 50% of the costs of business-related meals, both in and out of town. Employee parties and the costs involved can be deducted at 100%. Meeting or entertaining clients where you don't discuss business cannot be deducted.

Bad Debt

Any outstanding customer debt you have been unable to collect can be deducted.

Retirement

You can deduct the cost of your own retirement plan if it is qualified.

Taxes are complicated and complex, particularly when you run a small business. You have enough to worry about without adding the stress of a possible audit to it. Our Small Business Legal Protection Plans give you access to our network of qualified, dedicated small business attorneys who specialize in tax services for small businesses. Our experienced lawyers can make sure your tax documents are correct and help you avoid audits and other nasty tax surprises. Learn more about the benefits of our Small Business Legal Protection Subscription Plans or Sign Up Your Small Business Today!