Save Smart: A Modern Entrepreneur’s Guide to Taxes

Deductions You Might Be Leaving on the Table

Claim a dedicated, regularly used workspace with accurate square footage. Track internet, utilities, and rent allocations. A maker we know turned a spare room into a compliant studio, lowering taxable income without raising audit risk.

Compensation, Benefits, and Retirement Plans That Lower Your Bill

For S‑Corps, paying a market‑based salary and taking additional distributions can reduce self‑employment tax. Document your rationale: roles, industry data, and time spent. Consistency and evidence help during reviews or questions.

Compensation, Benefits, and Retirement Plans That Lower Your Bill

These plans allow high, flexible contributions. A solopreneur maxed a Solo 401(k), sheltering profit while building retirement security. Consider deadlines, catch‑up contributions, and payroll integration if you’re paying yourself a W‑2 wage.

Master the Calendar: Timing Income and Expenses

If profits are high this year, pull forward expenses like equipment or software. If next year looks stronger, defer invoicing a few days. Document business purpose so your timing reflects genuine operational needs.

Use rolling forecasts to project profit, then set aside taxes weekly. One founder linked a separate tax account and automated transfers, turning deadlines into routine, stress‑free payments with no eleventh‑hour scramble.

Paying at least last year’s tax or a percentage of current income can shield you from penalties. A photographer followed safe harbor, then trued up at filing, avoiding interest and preserving cash for gear.

Pair robust accounting software with bank feeds and rule‑based categorization. Reconcile weekly. A craft brand reduced categorization errors by half after adding clear chart‑of‑accounts rules and disabling messy duplicate feeds.

Build an Audit‑Ready Bookkeeping Habit

Credits and Incentives Many Founders Overlook

R&D credit for builders and tinkerers

Software features, prototypes, and process improvements may qualify. An indie app studio documented experiments and wages, offsetting tax with the credit. Meticulous notes on uncertainty and testing supported their claim convincingly.

Hiring credits that reward opportunity

Programs like the Work Opportunity Tax Credit can lower taxes when hiring eligible candidates. A bakery partnered with a workforce nonprofit, gained a fantastic employee, and trimmed its bill while changing a life.

Local incentives hiding in plain sight

Cities often offer relocation, training, or equipment incentives. A robotics startup negotiated a small grant and property tax relief after presenting community benefits. Subscribe for our upcoming checklist on finding regional programs.

Save Smart: A Modern Entrepreneur’s Guide to Taxes

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Deductions You Might Be Leaving on the Table

Compensation, Benefits, and Retirement Plans That Lower Your Bill

Compensation, Benefits, and Retirement Plans That Lower Your Bill

Master the Calendar: Timing Income and Expenses

Build an Audit‑Ready Bookkeeping Habit

Credits and Incentives Many Founders Overlook

R&D credit for builders and tinkerers

Hiring credits that reward opportunity

Local incentives hiding in plain sight