Tax Benefits Every Small Business Should Take Advantage Of

Taxes can feel like a burden, but they also offer valuable opportunities for small businesses to reduce costs and reinvest in growth. Knowing which tax benefits you qualify for can make a big difference in your bottom line. Here are key deductions and credits every small business should consider:

1. Section 179 Deduction
This allows businesses to deduct the full cost of qualifying equipment or software purchased and placed in service during the year. Great for tech, machinery, and office upgrades.

2. Home Office Deduction
If you operate your business from a dedicated home workspace, you may be eligible to deduct a portion of your rent, utilities, and internet.

3. Qualified Business Income (QBI) Deduction
Many pass-through businesses (like sole proprietorships and LLCs) may deduct up to 20% of their qualified business income. There are limits based on income and business type, so be sure to consult a tax professional.

4. Start-Up and Organizational Costs
New businesses can deduct up to $5,000 in startup costs and $5,000 in organizational costs in their first year, including legal fees, research, and initial training.

5. Work Opportunity Tax Credit (WOTC)
This credit applies if you hire employees from certain target groups, including veterans and long-term unemployed individuals. It’s a great way to save while investing in your team.

Get the Most Out of Your Taxes
At Momentum, we make sure you’re not leaving money on the table. Our team stays up to date on federal and state tax benefits and will guide you through what applies to your business. Reach out today to learn how you can save and grow smarter.