Top Tax Deductions for Home-Based Business Owners
Running a business from home comes with unique tax advantages. Here are the top deductions home-based business owners should be claiming — and how to document them.
Running a business from home has real tax advantages — if you know what to claim. Here are the top deductions available to home-based business owners.
1. Home Office Deduction
Deduct a portion of your home expenses based on the percentage of your home used exclusively for business. Use the simplified method ($5/sq ft, up to 300 sq ft) or the actual expense method for a potentially larger deduction.
2. Internet and Phone
The business-use portion of your internet and cell phone bills is deductible. If you use your phone 70% for business, deduct 70% of the bill.
3. Office Supplies and Equipment
Computers, printers, monitors, desks, chairs, paper, ink — all deductible if used for business. Equipment may be fully deducted in the year of purchase under Section 179.
4. Software Subscriptions
QuickBooks, Microsoft 365, Zoom, project management tools, design software — all deductible as business expenses.
5. Professional Development
Books, courses, webinars, and certifications related to your business are fully deductible.
6. Marketing and Advertising
Website hosting, domain registration, social media ads, business cards, and any other marketing costs are deductible.
7. Professional Services
Fees paid to accountants, bookkeepers, attorneys, and consultants are fully deductible.
8. Health Insurance Premiums
Self-employed individuals can deduct 100% of health insurance premiums for themselves and their families — as an above-the-line deduction, even if you don't itemize.
9. Retirement Contributions
Contributions to a SEP-IRA, SIMPLE IRA, or Solo 401(k) reduce your taxable income dollar-for-dollar.
10. Business Meals
50% of the cost of business meals (with clients, partners, or employees) is deductible. Keep records of who you met with and the business purpose.
Documentation Is Everything
Every deduction requires documentation. Keep receipts, bank statements, and records of the business purpose for each expense. Digital records are fine — use a receipt scanning app or QuickBooks Online's receipt capture feature.
For a complete list of all deductions available to self-employed owners, see our tax deductions guide for self-employed Texans.
Related Resources
- Tax Deductions for Self-Employed Texans: The Complete List
- The Home Office Deduction: How to Claim It Correctly
- The Business Mileage Deduction: What You Can Deduct in 2026
- 10 Tax Deductions Every Small Business Owner Should Know
- Our Tax Preparation Services
- Contact Us
Want to make sure you're claiming every deduction you're entitled to? The Gap ProAdvisors prepares tax returns for self-employed individuals and small businesses nationwide. Contact us or pay for your tax prep online.
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About the author
The Gap ProAdvisorsOwner & Lead Advisor — The Gap ProAdvisors
Angela is a Certified Bookkeeper, QuickBooks ProAdvisor, and IRS Registered Tax Return Preparer (PTIN) with over a decade of experience helping small businesses across Texas get their books right and keep more of what they earn. She founded The Gap ProAdvisors to make professional financial services accessible to every small business owner — no matter where they are.
