The middle of the year presents a perfect opportunity for proactive business owners to reassess their tax strategies. Taking advantage of tax deductions and credits now can lead to significant savings and a reduction in tax burdens. By planning thoughtfully, you can unlock powerful deductions and credits—even those poised to expire soon. While navigating the complexity of tax law can be daunting, gaining clarity can grant you the control and confidence needed for financial efficiency.

Qualified Business Income Deduction

If you're a sole proprietor, part of a partnership, S-Corp, or LLC, you might be eligible for a 20% deduction on your qualified business income. This deduction, however, is set to expire at the end of 2025, making timely action crucial for maximizing its benefits.

Section 179 Deduction and Bonus Depreciation

Businesses have the chance to deduct the entire purchase price of qualifying equipment and software in 2025. Couple this with bonus depreciation, which applies to both new and used assets, and you have a robust strategy for immediate financial leverage.

Home Office Deduction

Using a portion of your home exclusively and regularly for business can open up deductions on rent, utilities, and internet expenses. This is a key area where many small business owners can reap significant tax benefits.

Research and Development Tax Credit

Contrary to popular belief, this credit isn't just for tech companies. If your efforts involve improving products or processes, you might qualify. Don't overlook potential savings in areas of your business where innovation flourishes.

Meals and Entertainment Deduction

While meals shared with clients or employees remain 50% deductible in 2025, it's important to know which business meals qualify under current tax law. Being aware of these can lead to more conscious and budget-friendly business dining habits.

Business Vehicle Expenses

Whether opting for actual expenses or the standard mileage rate, detailed mileage logs are essential. Keep track of business-related vehicle use to ensure accurate deductions.

State and Local Tax Deductions (SALT)

Navigating the $10,000 SALT cap can be challenging, but PTE elections provide a path for pass-through entities. Exploring these options can potentially enhance your tax position significantly.

Every business is unique, and not every deduction will fit your situation. However, as we steer into the latter half of the year, consider a mid-year tax check-in. Professional tax planning can unveil strategies tailored for you, aligning them with your broader business goals. Now is the time to review your tax strategy or schedule a personalized consultation to unlock the potential of these deductions and credits.