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Important Tax Deductions for Small Businesses & Startups in 2025

By Michael Nedreski

As a small business owner or startup, your goal is to retain more of your profits to reinvest in your company or support your family. In 2025, there are numerous tax deductions available to reduce your income tax burden and keep more of your hard-earned income.

Understanding these tax deductions now can help you boost your potential savings before the end of the tax year. Reach out to a financial advisor at White Oak Wealth Partners to discover which deductions you qualify for. In the meantime, here are some important tax deductions to watch for small businesses in 2025.

Important Tax Deductions for Small Businesses in 2025

Many expenses that keep your business running can generate tax deductions or credits that reduce the taxes you pay on your profits. A key to taking advantage of those tax breaks is to create a plan and maintain good records to track them. 

Consider these tax deductions for small businesses in 2025.

The Cost to Start Your Business

If you're starting a new business in the new year, you can deduct the costs you incur to launch your company. You can deduct up to $5,000 in startup costs for the year you begin operations. Costs above that—up to $50,000—must be spread out (amortized) over the next 15 years.

Business Meals and Entertainment

You can deduct some types of entertainment, like company parties, along with up to 50% of the costs of food and drinks you purchase for business purposes. The expenses must be directly related to your company, and you must document the following:

• Date and time of the event
• The business relationship of those in attendance
• The total cost

Keep a receipt and write detailed notes about the outing on the back of the receipt. Consider consulting a tax professional about IRS limits on deducting entertainment expenses.

Work-Related Vehicle Use

If you use your vehicle exclusively for work, you can write off what you spend to maintain and operate it. If you also use it for personal errands, only the expenses related to your business can be deducted. You can claim your business mileage or use the standard mileage rate from the Internal Revenue Service, which is $0.70 per mile in 2025.

Office Supplies and Equipment

Office supplies and equipment are some tax deductions for small businesses you shouldn't overlook. Computers and work-related software, printers, paper, and pens used during the year they were purchased can be deducted. You also can write off postage and shipping expenses. File away your receipts to have them available at tax time.

Employee-Related Expenses

You can deduct certain employee-related expenses deemed reasonable and necessary, including:

• Salaries
• Vacation pay and sick time
• Health and retirement benefits
• Life insurance
• Education
• Meals and lodging

To claim these tax deductions for small businesses, you must comply with all employment laws and regulations.

Professional Services

As a small business owner, you know that professional services from financial advisors, attorneys, and accountants can help you build a successful company. The cost of professional services and fees for financial planning and consulting for business strategy can be deducted from your taxes. You must keep good records of the fees and services.

These are just a few of the tax deductions for small businesses available. You also can claim tax credits and deduct expenses related to marketing and advertising, home office space, utilities, business loan interest and bank fees, business insurance, and more. This information is not intended to be a substitute for specific individualized tax advice. We suggest you discuss your specific tax issues with a qualified tax advisor. 

Strategize with a Financial Advisor on Tax Deductions 

Smart tax planning allows your business to make the most of all available credits and deductions. At White Oak Wealth Partners, we understand the challenges small business owners like you face and are here to provide our experienced guidance every step of the way.

To get started, contact us by calling 814-835-4551, emailing MICHAEL.NEDRESKI@LPL.COM, or scheduling an appointment here.

About Michael

Michael Nedreski is managing partner at White Oak Wealth Partners, a specialized financial lifestyle and wealth management firm serving entrepreneurs, business owners, executives, and their families. Mike has 30-plus years of experience in the financial services industry and is committed to serving his clients through holistic financial planning, disciplined investment strategies, and proactive personal service. 

A native of Erie, Pennsylvania, Mike began his career in the financial services industry in 1988. He has earned the Chartered Retirement Planning CounselorSM (CRPC®) designation conferred by College for Financial Planning (188-LPL). Mike is also an active member of the Financial Services Institute (FSI) and Financial Planning Association (FPA).

When not working, Mike enjoys spending time with his wife, Amy, and their children. He volunteers in his community and at his church and his children's schools. An outdoors enthusiast, Mike loves hunting, fishing, golfing, and spending time near or on the water. He also enjoys working out and watching some of his favorite sports teams, the Pittsburgh Pirates and the Cleveland Browns. To learn more about Michael, connect with him on LinkedIn.