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10 Tax Deductions U.S. Businesses Can Consider in 2025
Having a clear understanding of which expenses may be eligible for deductions can help reduce a business's tax burden and improve its profitability.
“Owning a home is a keystone of wealth, both financial affluence and emotional security.”
1. Office and technology-related expenses
When running a business, it's common to incur expenses related to maintaining a workspace and using digital tools. Some of these expenses that may be deductible include:
- Office or coworking space for rent.
- Office furniture and supplies.
- Electronic equipment used for the business, such as computers and printers.
- Software and subscriptions to digital work tools.
For those who work from home, there may be deduction options if the space is used exclusively for business activities. It's recommended to check with a tax professional.
2. Salaries and employee benefits
If a business has employees, certain payments and benefits provided may be considered for deduction, such as:
- Salaries and wages of employees.
- Employer-provided health insurance.
- Contributions to retirement plans such as 401(k).
- Training programs
This deduction does not apply to a business owner's personal income if they operate as a sole proprietor. Each type of business structure has different rules, so it's advisable to consult with an expert.
3. Use of vehicle for business
If a vehicle is used in business activities, some costs may be considered for deduction, such as:
- Fuel and maintenance.
- Insurance and licenses.
- Tolls and parking for business activities.
There are two methods the IRS allows for calculating this deduction:
Standard mileage deduction, based on a flat rate per mile traveled for business purposes.
Deduction based on actual costs, which considers expenses directly related to the use of the vehicle for business.
Keeping detailed records of the miles traveled and differentiating between personal and business use is key to calculating this deduction correctly.
4. Advertising and marketing expenses
All investments you make to promote your business are tax deductible, including:
- Digital advertising and social networks (Facebook Ads, Google Ads).
- Website design and SEO.
- Printed material (business cards, flyers).
- Email marketing campaigns.
An effective marketing strategy not only helps you grow, but also helps you reduce taxes.
5. Business training and development
If a business invests in improving the skills of its staff or owners, certain educational expenses may qualify for deductions, such as:
- Industry-related seminars and courses.
- Subscriptions to educational platforms.
- Certifications and training programs.
- Books and study materials.
To be eligible, these expenses must be directly related to the business and help improve skills necessary for its operation.
6. Financing costs and bank fees
Many businesses use loans or lines of credit to operate. Some financing costs may qualify for deductions, such as:
- Interest paid on commercial loans.
- Transaction fees for credit card payments.
- Bank charges related to business accounts.
These expenses can represent financial relief if managed correctly within the business's accounting.
7. Business insurance
Having insurance can be a necessity to protect a business. In certain cases, the costs of some policies may be considered deductible, such as:
- Civil liability insurance.
- Commercial property insurance.
- Employee insurance, such as workers' compensation.
Each type of insurance has specific rules regarding deductibility, so it's recommended that you review each case with a tax advisor.
8. Professional services and consulting
Many businesses hire experts to ensure they comply with regulations and manage their finances properly. Some services that may qualify include:
- Accounting fees and tax preparation.
- Business-related legal services.
- Business consulting rates
These costs can represent a smart investment for business growth and stability.
9. Depreciation of business assets
If a business purchases assets such as machinery, technology equipment, or furniture, it may be able to recover some of the cost with a depreciation deduction.
Depending on the asset, there are different depreciation methods that can be applied, including:
- Standard depreciation, which spreads the cost over several years.
- Business-related legal services.
- Business consulting rates
These costs can represent a smart investment for business growth and stability.
FAQ
Expert answers to your most common questions
An expense is deductible if it is ordinary and necessary for your business. According to the IRS, an ordinary expense is common and accepted in your industry, while a necessary expense is useful and appropriate for your business.
Yes, you can deduct a portion of your home expenses if you use a portion exclusively and regularly as your principal place of business. The IRS offers a simplified method for calculating this deduction, based on the square footage of the space used.
By 2025, key tax changes for businesses include Tax rate adjustments, increases in standard deductions, modifications to the Alternative Minimum Tax (AMT) exemption, increases in the Earned Income Tax Credit (EITC), and new limits on transportation benefits and flexible spending plansIt is recommended that you review these changes with a tax advisor to optimize your tax planning.
You must keep accurate records supporting all claimed deductions. This includes invoices, receipts, bank statements, and any other documents that demonstrate the nature and amount of the expenses. Lack of proper documentation may result in denial of the deduction during an audit.
The most common errors that can trigger an IRS audit include: excessive or unjustified deductions, failure to report all income, mathematical errors and inconsistent statements with IRS records
A tax deduction reduces your taxable income, while a tax credit directly reduces the amount of taxes you have to pay. Therefore, tax credits typically have a more significant impact on reducing your tax liability.