Running a small business comes with a lot of responsibility, from managing day-to-day operations and growing your customer base to budgeting, bookkeeping, and financial planning. One aspect of small business ownership that can't be overlooked is tax preparation. While all businesses are required to pay income taxes, you can often lessen your tax liability by claiming deductions. Below are three of the more common deductions for small businesses explained in more detail.

A Tax Deduction Guide for Small Businesses

1. Startup Fees

If you launched your business in the prior business year, now is the time to deduct startup costs. A business need not be fully operational for the owner to claim at least some of the expenses associated with starting the enterprise.

For instance, you can usually deduct office space rent, office supplies, business cards, employee training costs, business insurance, and loan fees. Your tax preparation professional will review your records and pinpoint all the startup costs that can be deducted.

2. Vehicle Costs

Many small business owners use a vehicle as part of their typical workday. This doesn't include driving to and from work, but it does encompass tasks like driving to meet with clients or vendors, running business errands, and even driving across town to the post office to pick up your mail each day.

The expenses associated with such use of a vehicle can be deducted from your taxes. There is a standard vehicle deduction, or you can choose a different amount based on your usage and the exact costs of operation, maintenance, gas, and insurance.

3. Operating Expenses

Whether you're a sole proprietorship of just one person or a multinational corporation with thousands of employees, all businesses cost money to operate. Many of these expenses are tax-deductible, including the costs of business travel, rent and utilities, business property repairs, hiring freelancers and independent contractors, and any depreciation in the assets owned by the business.

Hire a tax preparation professional to identify all the expenses you can deduct from your taxes. Lance S. Cox, Attorney at Law, has been serving Cincinnati, OH, for over 30 years. He offers taxation law and estate planning services, as well as representation in business and probate cases. Call (513) 528-6000 to schedule a consultation, and explore the practice online.