During the 2026 tax season, many freelancers, contractors, and small business owners across the United States are filing their returns. Yet a surprising number will end up paying more than necessary, and it’s not because they earned more, but because they failed to claim deductions they were entitled to. According to tax expert Sergio Salinas, Director of Tax at Acuity, the problem is both common and avoidable.

“Missed deductions are a common issue,” Salinas explains, noting that inconsistent expense tracking and a lack of awareness about what qualifies as a business expense are the main culprits. Without a clear system in place throughout the year, even experienced business owners can overlook valuable write-offs.

One of the most frequently ignored deductions is tied to working from home. Many business owners don’t realize they may be eligible to deduct a portion of their household expenses if part of their home is used exclusively for business. “You may be able to deduct a portion of expenses such as utilities, electricity, cellphone bills, and even mortgage interest or rent,” Salinas says. For those looking for a simpler approach, he adds that “there’s also a simplified method that allows a deduction of $5 per square foot…capping the deduction at $1,500.”

Vehicle-related expenses are another area where deductions are often incomplete. While mileage is widely recognized, it’s not the whole picture. “Mileage requires a log or tracking app to document business travel, so if that record isn’t kept throughout the year, the deduction is often lost,” Salinas explains. Beyond that, many overlook related costs entirely. “Expenses like parking fees and tolls are also often deductible when the travel is business-related,” he adds. In certain cases, even loan interest or insurance tied to a business vehicle may qualify.

Startup costs present another opportunity that is frequently underutilized. Launching a business often involves expenses that fade into the background once operations begin, but they still matter at tax time. “In many cases, businesses can deduct up to $5,000 in startup costs in the first year,” says Salinas, pointing to expenses like legal fees, market research, training, and early advertising. He also highlights that some costs people assume are personal may actually qualify depending on the business. For example, expenses tied directly to branding can sometimes be considered legitimate deductions.

Health insurance is another area where business structure plays a crucial role. “If you’re a single-member LLC or sole proprietor, you typically can’t deduct health insurance directly as a business expense, but you may still be able to deduct those premiums on your personal tax return,” Salinas explains. For corporations, the treatment differs and may require payroll adjustments to qualify, making it important to understand how your entity is set up.

Professional development is not just an investment in growth. It can also reduce taxable income. “Education expenses that maintain or improve skills related to your current business are generally deductible,” Salinas notes, including certifications, conferences, books, and subscriptions. This makes ongoing learning both a strategic and financial advantage.

Some of the most easily missed deductions are also the most routine. “Bank fees and payment processing fees are deductible business expenses,” Salinas says, pointing to monthly account charges and credit card processing costs as examples. Because these are small, recurring expenses, they’re often overlooked despite being clearly documented in financial records.

Technology has become essential to nearly every business, and most related expenses qualify as deductions. “That includes things like cloud storage, cybersecurity software, AI tools, project management platforms, and CRM systems,” Salinas explains. Whether it’s a subscription or a one-time purchase, if it supports business operations, it is generally considered deductible.

Retirement contributions offer another way to reduce taxable income while planning for the future. “For smaller or self-employed businesses, contributions to accounts like a traditional IRA may reduce taxable income,” Salinas says. For larger or more established businesses, employer contributions to retirement plans are typically treated as deductible expenses as well.

Even unpaid invoices can have tax implications, depending on how a business reports income. “Bad debt deductions generally apply to businesses using the accrual method of accounting,” Salinas explains, since income may have been recorded before payment is received. In contrast, businesses using the cash method only recognize income when it is actually collected, meaning unpaid invoices are not taxed in the first place.

Despite the wide range of potential deductions, Salinas emphasizes that the real advantage comes from consistency. “Keeping the books clean throughout the year makes tax season far more manageable,” he says. Accurate records not only help ensure compliance but also make it easier to identify every available deduction and credit.

He also stresses the value of professional guidance. “Working with a tax professional helps ensure that deductions aren’t missed and that the business is set up correctly from the beginning,” Salinas explains. Beyond filing, a knowledgeable advisor can help evaluate entity structure and accounting methods, decisions that can significantly influence how a business is taxed as it grows.

Avoiding overpayment isn’t about last-minute adjustments. It’s about awareness, organization, and informed decision-making throughout the year.