928 W 1800 N Ste J
Clinton, UT 84015
Simple Accounting
Call Us: 801-409-1309
“Top 5 Tax Mistakes Small Business Owners Make –
And How to Avoid Them”
Running a business is no small feat — you’re juggling operations, customers, marketing, and a million other things. But one area you can’t afford to overlook is your taxes. As tax professionals, we’ve seen how simple missteps can cost business owners thousands in penalties, missed deductions, or IRS scrutiny.
Here are the top 5 tax mistakes we see (and how to avoid them):
1. Mixing Personal and Business Finances
The Mistake: Using one bank account for everything.
Why It Matters: It’s harder to track expenses, which can lead to missed deductions or IRS red flags.
The Fix: Open a dedicated business checking account and get a business credit card. Keep receipts organized with tools like QuickBooks or Expensify.
2. Not Making Quarterly Estimated Payments
The Mistake: Waiting until tax season to pay all your taxes.
Why It Matters: If you’re self-employed or a business owner, you’re responsible for paying estimated taxes throughout the year. Miss them and you could be hit with penalties.
The Fix: Work with your accountant to calculate and schedule estimated payments each quarter. A good rule of thumb is to pay 25% of your estimated tax liability every quarter.
3. Overlooking the Home Office Deduction
The Mistake: Thinking you don’t qualify because your office isn’t a separate room.
Why It Matters: If you use part of your home exclusively and regularly for business, you may qualify for a powerful deduction.
The Fix: Track your home office square footage and business-related expenses like utilities and internet. We’ll help determine your eligible deduction.
4. Missing Out on the Qualified Business Income Deduction (QBI)
The Mistake: Not realizing you may qualify for a 20% deduction on your net income.
Why It Matters: The QBI deduction can reduce your tax liability significantly — especially for sole proprietors, partnerships, and S Corps.
The Fix: Work with a tax professional to ensure your income and business type qualify, and that you’re structuring your business for maximum benefit.
5. Waiting Too Long to Ask for Help
The Mistake: Only talking to your accountant in March or April.
Why It Matters: Tax planning should happen year-round. The earlier you involve your accountant, the more you can save and prepare.
The Fix: Schedule a mid-year tax review to strategize and make proactive moves — not just reactive ones.
Need Help With Your Taxes?
At Simple Accounting, we specialize in helping small business owners stay compliant, lower their tax bills, and focus on what they do best — running their business.
📅 Book a free consultation today or call us at 801-409-1309