Each year, millions of small business owners attempt to prepare and file their own taxes. Although this can save money on professional tax preparation, it could cost business owners in the end. Mistakes in tax filing can cost the business owner money from lost deductions or even in tax penalties and interest from the IRS.

Here are six tax mistakes to avoid if you prepare your small business taxes along with your personal tax return.

  1. Forgetting Charitable and Non-Profit Contributions

    Did your small business donate money, time, or materials to a charitable organization last year? Be sure you get full value for what you donated to a charitable or non-profit group that has a tax-exempt status with the IRS.

    • Money – All monetary donations can be deducted from your small business taxes. Keep receipts from the charitable organization.
    • Time – Did you offer services to a non-profit group? Your time can be deducted and calculated based upon your hourly fee rate. Again, ask a non-profit to provide you with a confirmation of time donation.
    • Materials – You can also deduct any other donations, such as office furniture, automobiles, and equipment.

  2. Home Office Deduction Mistakes

    Did you include a home office as a small business tax deduction? If so, be absolutely sure that you can do so according to IRS regulations. Your home office must be a dedicated space for your business and not used for any other purpose. Also, it must be the primary place you conduct your small business activities.

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