The state and local tax (SALT) deduction has been one of the most debated provisions in tax law since the TCJA capped it at $10,000 in 2018. The One Big Beautiful Bill Act raised that cap to $40,400 for 2026, with income-based phase-downs for higher earners. For small business owners — especially those in states with income tax — this changes the math on itemizing, entity structure, and pass-through entity tax elections. What Changed Under the TCJA, the SALT deduction for ind

construction workers construction workersHiring someone as an independent contractor instead of an employee has real tax consequences — for both you and the worker. When the classification is wrong, the IRS can reclassify the relationship and assess back employment taxes, penalties, and interest. Worker misclassification is one of the IRS’s top enforcement priorities because it directly affects employment tax revenue. Why the Classification Matters If someone is an employee,

If you drive for business, you have a deduction available. The question is which method to use — the IRS standard mileage rate or actual vehicle expenses — and whether you’re documenting it well enough to survive scrutiny. Vehicle expenses are one of the most commonly examined deductions in small business audits because of the personal-use component. The 2026 Standard Mileage Rate For 2026, the IRS standard mileage rate for business driving is 72.5 cents per mile. That means

The home office deduction is one of the most commonly claimed — and most commonly questioned — deductions for small business owners. The IRS has specific rules about what qualifies, and they’re stricter than most people think. Getting it right means documenting your space and your usage. Getting it wrong means losing the deduction entirely during an examination. The Two Requirements: Regular and Exclusive Use To claim the home office deduction, your workspace must meet two te

You started selling things on Etsy. Or freelancing on the side. Or doing photography on weekends. It started as extra income, but now it’s generating real money. At some point, the IRS stops treating that activity as a hobby and starts treating it as a business — and the tax consequences of that distinction are significant. Here’s how the IRS draws the line, what factors they look at, and why getting this right matters for your deductions and your liability. Why the Distincti

The Section 199A Qualified Business Income (QBI) deduction was set to expire after 2025. It didn’t. The One Big Beautiful Bill Act made it permanent starting in 2026. If you own a pass-through business — sole proprietorship, S-Corp, partnership, or LLC — this deduction directly reduces your taxable income by up to 20% of your qualified business income. Here’s what the QBI deduction is, how it works, who qualifies, and what changed now that it’s permanent. What the QBI Deducti

If you’re self-employed or own a business that doesn’t withhold taxes from your income, the IRS expects you to pay taxes throughout the year — not just at filing time. These are quarterly estimated tax payments, and getting them wrong is one of the fastest ways to end up with a penalty you didn’t see coming. Here’s how estimated taxes actually work, when they’re due, how to calculate them, and how to avoid the most common mistakes. Who Needs to Pay Estimated Taxes If you expe

Tax season can be stressful, especially when your tax preparer asks for documents you don’t have on hand. Missing paperwork often leads to delays, extra phone calls, and sometimes even penalties. To avoid these headaches, it’s crucial to come prepared with the right documents. This post offers a clear checklist and practical advice to help you gather everything your tax preparer needs for a smooth and timely filing. !Eye-level view of organized tax documents neatly stacked on

Tax season often leaves taxpayers wondering if they missed something important on their returns. One common question is whether you can amend a tax return to add more deductions. The answer is yes, but deciding if you should is more complex. This post explores when amending your tax return makes sense, what risks to watch for, and how to approach the process responsibly. !Close-up view of a tax form with a pen resting on it When Amending a Tax Return Is Appropriate Amending a

Filing taxes for S-Corporations and Partnerships involves more than just filling out forms. The IRS requires specific documents that must be accurate and complete to avoid penalties and ensure smooth processing. As the March 16 deadline approaches, understanding which documents are non-negotiable for 1065 (Partnership) and 1120-S (S-Corporation) filings becomes critical. This post breaks down the essential paperwork and explains the concept of basis reporting, a key element o

Most deduction issues don’t come from people trying to do something wrong. They come from: * Partial information * Internet oversimplification * Advice taken out of context * Rules that sound simpler than they are Many common small business deductions are perfectly legitimate—but they’re also the ones most likely to cause confusion later if they aren’t handled carefully. This post isn’t about prohibiting deductions.It’s about understanding where extra care matters and why doc

If you’re self-employed, chances are you’ve had this moment: You file your tax return. You see the tax bill. You think, “There’s no way this is right.” It usually is. Self-employment taxes aren’t mysterious—but they are widely misunderstood. Most stress around them doesn’t come from the amount itself. It comes from not knowing what you’re paying, why you’re paying it, or how to plan for it. This guide explains self-employment taxes in plain English: * What they actually are *

Tax season has a way of making otherwise rational people spiral. Even taxpayers who’ve filed for years suddenly second-guess everything: * Did I miss something? * What if I did this wrong? * What if the IRS flags me? * Should I rush and just get it over with? Here’s the reality I want you to understand — grounded in how the IRS actually works: Tax season panic almost never aligns with IRS risk. I didn’t see tax returns in real time. I didn’t see people rushing to file. I didn

January is a quiet month for taxes—and that’s exactly why it matters. There are no filing deadlines breathing down your neck yet. Forms are still arriving. The IRS isn’t actively chasing most people. And because of that, January is when many taxpayers do… nothing. That’s a mistake. From inside the IRS, January is where a lot of future tax problems quietly start—not because people are doing anything wrong, but because they delay simple, foundational steps that make the rest of

Every December, the internet explodes with tax advice. “Write everything off!” “Buy a truck!” “Open an LLC tonight!” “Spend money to save taxes!” Most of that advice is either misleading, incomplete, or flat-out wrong. Here’s the reality, grounded in IRS rules and how returns are actually reviewed: By December 31, only certain tax moves still matter—and only if they’re done correctly. This post walks through: * What legitimately counts before midnight * What does not work (de

Every year, tax season shows up like it owns the place. And every year, the internet does the same thing: screams about “massive changes,” “new rules,” and “big refunds,” while most taxpayers are still trying to find their W-2. So let’s cut through the noise. Tax Season 2026 means you’re filing your 2025 federal return (generally due April 15, 2026). A few things did change. A lot stayed the same. And only a handful of updates actually matter for real people—especially small

January feels deceptively quiet. The holidays are over. Tax season hasn’t fully hit yet. Forms haven’t all arrived. There’s a sense that you have time—that you’ll deal with taxes “later.” From the inside of the IRS, January is where many tax problems quietly begin. Not because people are doing anything malicious—but because they make small, avoidable mistakes early in the year that snowball by March or April. This post walks through the most common January tax mistakes, why t

Tax season stress rarely comes from the tax return itself. It comes from scrambling. Scrambling to find receipts. Scrambling to remember what that transfer was for. Scrambling because you know the numbers aren’t quite right—but you’re hoping they’ll “work out.” After years of working inside the IRS, here’s what I can tell you with certainty: Tax season is only stressful when your records aren’t ready. The IRS doesn’t expect perfection. But it does expect documentation. And th

Every January, small business owners scramble to “get their receipts together.” Some find them in glove boxes. Others in junk drawers, inboxes, or half-torn envelopes. And some just shrug and hope their bank statements will be enough. But from the IRS side? Missing or incomplete receipts can undo months of hard work—because records are the backbone of every deduction. Let’s talk about why those receipts matter more than you think, what the IRS really looks for, and how to mak

Most business owners think of December as a wrap-up month—time to close out the books, breathe a little, and gear up for tax season. But for one Central Florida business owner, year-end cleanup didn’t just bring closure—it revealed nearly $4,800 in hidden profit she didn’t even know she had. Here’s how it happened—and how you can find your own hidden profit before the year ends. 1. The Backstory: A Busy Baker With Messy Books Sarah runs a small home-based bakery in Eustis. Sh