For small business owners, saving up that extra money from taxes can spell the difference between being profitable and just getting by. At the end of the day, what matters most isn’t how much you make, but how much you get to keep.

Here are a few tax-saving tips to ease the financial burden.

Home office deduction

Small-business owners are usually self-employed, which means they most likely work from home. This allows you to deduct from your home office and save on a sizeable chunk of cash from your taxes. Most small-business owners avoid this route of home deduction out of fear of an IRS audit. This should not be a problem so long as you have allotted an area in your home solely for business purposes.

Deduct car expenses

Your car can be a vital part of your business, especially if you use it to visit your client’s workplaces. The IRS allows two options for tax deductions on business vehicles—you can either keep a record of your gas mileage or keep track of your car’s overall expenses which include gas, repair, and maintenance.

Different factors such as vehicle type should be taken into consideration. This method allows you to save thousands of dollars annually in business taxes.

Pay Yourself

There exist a number of tax advantages for small-business owners. Most noticeable among them are the retirement accounts created for the self-employed. Retirement options such as the 401(K) and the SEP IRA allow business owners to “pay themselves” before taxes are deducted. It is also possible to combine a number of these saving programs with a “normal” IRA, making it possible to save up to $50k a year.

Although the suggested income saving is around 15% a year, this makes sense when you are in your 20s or 30s. The number is not enough for when you reach an older age and require larger amounts for saving. Try a retirement calculator; it’ll give you a rough estimate on how much you should save for retirement.

Accounting for tax and getting the proper paperwork done can be a bit confusing and overwhelming at times. We suggest availing our professional accounting services to help you save up on every possible penny and free you from the incessant worry!