Guide to LLC Tax Filing
A tax write-off for an LLC is a deductible expense or loss that reduces the LLC's taxable income, ultimately lowering the amount of income subject to taxation.
Starts at $0 + state fees and only takes 5-10 minutes
Last Updated: March 23, 2026
Most business owners are always looking for any cold, hard cash they can get back. Many entrepreneurs choose LLCs for their flexibility and pass-through taxation. But it’s easy to overlook the fact that there are also a good number of tax write-offs that LLCs can take advantage of.
While only a tax professional can determine a business owner’s final tax bill, it’s helpful to keep in mind that the more legitimate tax deductions the company can claim, the less tax it’ll owe. This guide provides a brief look at some common business tax deductions and LLC tax write-offs to give entrepreneurs a good sense of what to talk about with their accountant at tax time.
A tax deduction is an amount a business owner can subtract from their reported taxable income when they file their taxes. This deduction lowers the amount of taxes an owner owes. There are two types of deductions. A standard deduction is a single deduction that a taxpayer takes at a fixed amount. Filers also have the choice of itemizing their deductions on Schedule A of their federal income tax returns filed with the Internal Revenue Service (IRS).
If a business owner operates as a single-member LLC, their standard deduction when they file their 2026 taxes will be $16,100 (individual) or $32,200 (married filing jointly). For many business owners, filing itemized deductions can yield substantial savings. Itemized deductions (in most cases) are more beneficial than using the standard deduction.
What expenses can someone write off with an LLC? This section provides a brief tax deduction cheat sheet to help entrepreneurs understand both tax deductions and what can be written off as a business expense.
Many business owners wonder if there’s an LLC car write-off available. Entrepreneurs often use their own cars for deliveries and meetings. The good news is that a business owner can write off their car expenses using one of two methods allowed by the IRS.
A common misconception is that “auto expenses” include only mileage. Car expenses can include fuel and oil, repairs, maintenance, and insurance.
Using the actual expense method, a business owner simply adds up all of their vehicle expenses and then divides by the percentage of time they use the car for business. This can include lease payments, fuel, maintenance, and other expenses. The actual expense method is good for rideshare drivers or other small business owners whose jobs have heavy driving demands.
The standard mileage rate method is a much simpler way to write off a car for an LLC. Instead of keeping track of receipts, an entrepreneur simply tracks their business and personal mileage for the tax year. They can even take a photo of the odometer on New Year’s Day and take another one on New Year’s Eve!
As with other tax deductions, an entrepreneur needs to keep track of the percentage of their mileage that applies to their business. It’s possible to do this with a paper mileage log or even an app.
In 2026, the standard business mileage deduction is 72.5 cents per mile for business use.
As mentioned, if someone uses their vehicle for both business and personal use, they’ll need to keep track of their business usage. Even if a person bought their car for business purposes and has their company’s logo printed on the side, they can’t count the time spent driving their child to soccer practice as a business expense. However, if they bought and used their car exclusively for their company, then they might be able to claim 100% of those car expenses as business tax deductions. Talk to a tax professional or visit the personal vs. business expenses guide to learn more.
One of the most challenging things for entrepreneurs is calculating startup costs. ZenBusiness can help entrepreneurs figure out their small business startup costs and help them understand when they’ll make a profit. But more importantly, many of those startup costs are tax-deductible.
Professional fees for accountants, attorneys, and related expenses are often considered business expenses and are tax deductible.
An entrepreneur may even be able to write off services like ZenBusiness that help form an LLC. Registered agents can also be written off as business expenses.
Insuring a business against risk isn’t just smart business — it’s smart money. The cost of business insurance can be a tax write-off for LLCs. Just make sure to exclude any personal insurance costs.
Business trips need to be necessary for a company to qualify for an LLC tax write-off. Business travel expenses typically have to be for trips lasting more than one working day to qualify.
Businesses often take out loans to finance capital investments or operations costs, meaning small business owners can deduct the cost of interest from their taxes.
Bonus depreciation is a tax incentive that allows a business to immediately deduct a large percentage of the purchase price of eligible assets, such as machinery, instead of writing them off over the “useful life” of that asset. Bonus depreciation is also known as the extra first-year depreciation deduction.
Section 179 of the US Internal Revenue Code offers an immediate expense deduction to business owners for purchases of depreciable business equipment. Business owners can do this instead of capitalizing and depreciating the asset over time. While this seems like an ideal situation, there are limits to Section 179 deductions, so it’s prudent to check with a tax professional before using this.
The de minimus safe harbor election allows an entrepreneur to immediately expense assets and certain repairs up to $2,500 per asset or repair. If the company is a reporting company or it has financial statements audited by a CPA, that amount is raised to $5,000.
To use this tax election, the asset or repairs in question must be for ordinary and necessary business use. Also, the business must be consistent in how it accounts for those expenses for the tax year. For instance, the business can’t expense some items and capitalize others.
The de minimus safe harbor election has some similarities to Section 179. However, it doesn’t come with dollar limitations on the election. This is an excellent LLC tax break to use to immediately capture expenses that might have otherwise been capitalized — with deductions spread out over a number of years.
Taxes, like real estate taxes, can represent a great LLC tax loophole. A business owner can write off property taxes up to a maximum of $10,000. Some entrepreneurs might even be able to write off homeowners’ association fees. It’s prudent to check with a tax professional before taking these deductions.
Professional licenses may also qualify as a business expense. An important tax write-off for LLCs providing licensed professional services can include the cost of obtaining and maintaining the necessary license.
Small business owners need to stay up-to-date on the latest news and technology in their field. Education expenses can include seminars, conferences, workshops, and even formal education related to the company’s industry, profession, or trade.
If the education expense pertains directly to the business, it could be a tax deduction.
When a business is just starting up, the owner needs to find a way to tell customers who they are. Advertising expenses can include any kind of promotional material that tells potential customers about the business. This includes flyers, websites, business cards, banners, and even skywriting. Almost any kind of advertising and promotion can be a tax write-off for LLCs.
The TCJA (Tax Cuts and Jobs Act) established a new tax deduction for owners of pass-through businesses like LLCs. Qualifying pass-through business owners can deduct up to 20% of their net business income from their income taxes. This can reduce a small business owner’s effective income tax rate by 20%. This deduction was made permanent by the Big Beautiful Bill in 2025, and in the 2026 tax year, some tax thresholds and rates will change.
Like all LLC tax deductions, there are some limitations. Suppose a business provides personal services, like law or accounting. For the 2025 tax year, if an owner of a service business has taxable income that exceeds $394,600 (married filing jointly) or $197,300 (single filers), the QBI deduction may be reduced. In 2026, if the income exceeds a set threshold, the deduction goes away completely. It’s highly recommended to consult with a tax professional when calculating these numbers.
If a business owner is a non-service provider and their taxable income is $150,000 or more above the income threshold if married filing jointly or $75,000 if single — the pass-through deduction is fully subject to a W-2 wage and business property limitation.
Similarly, suppose an owner’s taxable income is less than $150,000 over the threshold if they’re married and filing jointly, or less than $75,000 over the threshold for single filers (these numbers apply to the 2026 tax year; previous amounts were $100,000 and $50,000, respectively). Then, only part of the deduction is subject to the limit, and the rest is based on 20% of the QBI.
Companies pay business tax on salaries and wages that they pay out to employees, meaning this can be a qualifying tax write-off. However, certain rules govern what types of salary payments are business expenses.
To qualify as a business expense, an employee can’t function only as the sole proprietor, a partner, or a limited liability company member. Furthermore, the salary paid must be necessary for the business to operate and commensurate with their experience and job function.
If a business owner runs their business from home, they can deduct certain expenses like electricity, internet, and other things necessary to run their business. Just be sure to speak with a tax professional about ensuring the company is allocating the correct proportion of time, space, and costs to business expenses versus home expenses.
Working parents or parents actively pursuing employment who have dependents under age 13 can claim the Child and Dependent Care Tax Credit.
This credit is a dollar-for-dollar reduction of taxes for up to 35% of applicable expenses. Depending on an owner’s expenses, this could equal up to $3,000 for one child or $6,000 for two or more children.
If a person is self-employed or has a pass-through business, retirement plan contributions may represent a great tax write-off. The exact amounts that a taxpayer can contribute depend on the type of plan being used. For example, if in 2024, someone used a Simplified Employee Pension (SEP), they could contribute up to 25% of their self-employment net earnings (up to $69,000). With some plans, taxpayers might even be able to take advantage of catch-up contributions if they’re age 50 or older.
For 2026 tax returns, taxpayers can deduct qualified, unreimbursed medical expenses that are more than 7.5% of their adjusted gross income.
Qualifying medical expenses can include:
This isn’t an exhaustive list, so it’s wise to ask a tax professional whether specific medical expenses qualify.
Charitable contributions can account for a significant portion of an LLC’s business expenses. They can also help the community get to know a business and raise its profile by providing much-needed exposure when the company is just starting out.
Business owners should be sure to keep good records so they can prove that they made appropriate donations to legitimate charities and always save receipts.
Since 2018, moving expenses are no longer eligible for a deduction on a federal tax return. That said, some states continue to provide a deduction on a state tax return for qualifying filers. Interested taxpayers should check with their tax professional to see if their state offers this deduction and if they qualify.
Suppose a business owner is self-employed, they rent their home, and they use their home as their place of business. If so, their rent payments could be counted toward the home office deduction on their tax return. Check with a tax professional to determine how much can be deducted.
Providing the business with internet and phone service is typically a 100% deductible expense. This is especially true if phone and internet service are essential to the function and operation of the business. This can also include in-flight internet purchases and mobile Wifi devices and purchases.
However, if a business owner uses their phone and internet for a mix of work and personal reasons, they should be sure to keep track and only write off the portion of usage that applies specifically to their business.
If the bank charges fees for maintaining business accounts or interest on business credit cards, these could qualify as business expenses and could be deducted from the owner’s tax returns.
Entrepreneurs sometimes don’t realize that their trade association dues are on the LLC tax deductions list. If a business owner is a member of any local or national business association, they can usually write off their association dues and payments. These typically count as business expenses.
A business owner can deduct up to $25 per person for gifts given directly or indirectly during each tax year. Shipping and handling aren’t included in that $25 limit.
Incidental items costing $4 or less that may already have the company’s logo on them are excluded. This means a business owner can give out almost as much swag as they want and still benefit from the gift deduction!
Books and subscription fees are essential to keeping business owners up-to-date and allowing them to run successful businesses in most industries. Certain industries even require subscriptions to sophisticated software that provides vital real-time information. All of these can qualify for tax deductions and write-offs under the correct circumstances.
Recommended articles:
ZenBusiness can help an entrepreneur get their business up and running, and once they are, ZenBusiness can help them keep track of their finances. ZenBusiness’s corporate and LLC formation services can help get a company set up fast. The ZenBusiness Money Pro platform can help keep the company’s financial documents and receipts organized and ready for tax time. It makes bill paying, invoicing, and doing taxes incredibly straightforward. Their Accounting Basics for Small Business guide can help entrepreneurs gain the confidence they need to be fluent in the language of finance.
Depending on how someone uses their vehicle for business, they might be able to write off aspects of owning or leasing a car. They’ll be able to select from two methods. The actual expense method calculates the deduction as a percentage of the taxpayer’s actual expenses. The standard mileage deduction uses a formula to account for all annual car expenses.
Pass-through taxation affords entrepreneurs a couple of benefits. First, it prevents the double-taxation model that a corporate structure offers, where profits are taxed when the corporation receives them, and again when they’re paid to the individual shareholders. Second, it allows a business owner to claim a QBI, which can provide additional tax savings.
There are many deductions a business owner can claim without receipts. However, it’s essential to keep good records of all claimed deductions. In some cases, a receipt won’t be provided, or the expense is such that a receipt isn’t available. Business owners can keep detailed notes of their recollections, as well as any estimates or other information in lieu of receipts.
Yes. Many small business owners elect to have their business pay for their cell phones.
One of the biggest benefits of being an LLC is the flexibility for entrepreneurs. Speak with a tax professional about what kind of tax elections are right for the business’s unique circumstances.
Tax write-offs for LLCs work much the same way they do when filing personal income taxes. When a taxpayer writes off something that their business is using, they can reduce the taxable income the LLC is passing to them. This, in turn, lowers their tax liability.
If an entrepreneur had no income when they started their business, they can deduct or amortize startup expenses instead of filing business taxes with no income. If they were actively doing business but generated no income, then they should file and claim their expenses.
If the LLC earned no income but had expenses, the owner needs to file an information return. That way, the IRS knows about payments that could be treated as deductions or credits. Talk to a tax professional to confirm filing status.
Tax Information and Resources
Start an LLC in Your State
When it comes to compliance, costs, and other factors, these are popular states for forming an LLC.
Disclaimer: The content on this page is for information purposes only and does not constitute legal, tax, or accounting advice. For specific questions about any of these topics, seek the counsel of a licensed professional.
Ready to Start Your LLC?
Scan to download
the ZenBusiness app
