Missed deductions almost never come from not knowing the tax code. They come from not having a record. The expense was real, it was legitimate, and it is invisible because nobody wrote it down in June.
Work through this checklist against your own records. Anything you cannot document, start documenting now for next year. This is general information, not tax advice — confirm specifics with your own preparer.
Vehicle and travel
- Business mileage — the single most commonly under-tracked deduction for service businesses.
- Parking and tolls on business trips.
- Vehicle maintenance, insurance, and registration on business-use vehicles.
- Lodging and airfare for overnight business travel.
Home office and communications
- Home office — a dedicated space used regularly and exclusively for business.
- Business-use percentage of cell phone and home internet.
- A second phone line used only for the business.
Tools, supplies, and equipment
- Small tools and equipment purchased during the year.
- Consumable supplies used in the work itself.
- Work clothing and protective gear that is not suitable for everyday wear.
- Repairs to business equipment.
Professional and operating costs
- Software subscriptions, including accounting and scheduling tools.
- Bank fees, merchant processing fees, and card processing percentages.
- Business licenses, permits, and renewals.
- Legal, accounting, and bookkeeping fees.
- Business insurance premiums.
- Industry association dues, certifications, and continuing education.
Marketing and customers
- Website hosting, domain, and design.
- Advertising, including online ads and local sponsorships.
- Vehicle wraps, signage, and printed materials.
- Business meals with clients, generally at 50%, with the purpose documented.
Money and people
- Contract labor paid to 1099 subcontractors.
- Wages and payroll taxes for employees.
- Interest on business loans and business credit cards.
- Retirement plan contributions through a SEP or solo 401(k).
- Self-employed health insurance premiums.
- Bad debt on invoices you already recorded as income and will never collect.
The two that cost owners the most
Merchant processing fees and mileage. Processing fees get netted out of deposits so they never appear as an expense unless someone books them. Mileage is a large number built from many small trips that nobody logged. Together they can be several thousand dollars of legitimate deductions that quietly disappear each year.
Deductions require records, not memory
A deduction you cannot document is a deduction you should not take. That is the real argument for keeping books during the year rather than reconstructing them in February.
LedgerFast categorizes expenses to Schedule C lines as they happen across bank, cash, and app payments, and builds a Tax Organizer all year so nothing gets found too late. Plans from $49/month, first month free — see a sample monthly report on the demo page.