The deductions that get missed most often aren’t hidden or exotic. They’re ordinary business costs that don’t get tracked, get categorized wrong, or get skipped out of fear.

The home office deduction is probably the most avoided legitimate deduction out there. Many business owners have heard it triggers audits, which was somewhat true decades ago but isn’t the concern it used to be. If you use a dedicated space in your home regularly and exclusively for business, you qualify. The simplified method gives you $5 per square foot up to 300 square feet. The actual expense method can yield a larger deduction but requires tracking mortgage interest or rent, utilities, insurance, and repairs proportionally. Either way, if you work from home, take it.

Retirement contributions are another big one. A SEP IRA lets you contribute up to 25% of your net self-employment income, and a Solo 401(k) can allow even more. These reduce your taxable income dollar for dollar while building retirement savings. Many business owners don’t realize they can set up and fund a SEP IRA all the way up until their tax filing deadline, including extensions.

Self-employed health insurance premiums are deductible, but they don’t go where you’d expect. This deduction is taken on your personal return as an adjustment to income, not on your Schedule C. It’s easy to miss if you or your tax preparer aren’t looking for it specifically. If you’re paying for your own health, dental, or long-term care insurance and you’re not eligible for an employer plan through a spouse, this deduction applies.

Vehicle expenses get underreported constantly. The standard mileage rate for 2024 is 67 cents per mile, which adds up fast for anyone driving between job sites, client meetings, or supply runs. But you have to track mileage as it happens. Reconstructing a year of driving from memory doesn’t produce reliable numbers, and the IRS knows it. Use a mileage tracking app and log trips daily.

The deduction for one-half of self-employment tax is built into the return, but startup costs often get overlooked entirely. If you spent money before your business officially opened, things like market research, training, legal fees, or setting up your space, you can deduct up to $5,000 in your first year and amortize the rest over 15 years.

Section 179 and bonus depreciation let you write off the full cost of qualifying equipment and assets in the year you buy them instead of depreciating over several years. Computers, vehicles over 6,000 pounds, furniture, machinery. If you purchased something significant for your business and only saw a small depreciation amount on your return, this might have been missed.

Smaller expenses add up too. The business portion of your cell phone bill, internet service, professional development courses, industry memberships, software subscriptions, and even bank fees on your business account are all deductible. Individually they seem minor, but together they can represent thousands of dollars in missed deductions.

The pattern behind most missed deductions is the same. Either the expense wasn’t tracked at all, it was tracked but categorized as personal, or the business owner didn’t know it qualified. Having clean books through small business tax returns preparation is what makes it possible to capture everything you’re entitled to. And working with someone who provides proactive tax advisory means these deductions get identified before filing season, not after.