Tax FAQs: Answers to Common Small Business Questions

You’ve probably heard the saying: “Nothing is certain except death and taxes.” Well… we’d like to add a third: questions about taxes.

Because let’s be honest, whether you’re brand new in business or years in, tax questions always pop up. The good news? We’ve got answers. Think of this Tax FAQs guide as your mini roadmap to swap out confusion for clarity (and maybe even a little calm in the process).

Tax FAQs: Do I Need to File a Separate Tax Return for My Business?

It depends on your business structure.

• S Corp, C Corp, or Partnership → Yes, you’ll need to file a separate business tax return (and it’s due before your personal return).

• Sole Proprietor or Single-Member LLC → Nope. Your business income gets reported on your personal tax return.

Tax FAQs: What Can I Deduct for My Business vs. Personally?

Here’s the short version:

• Business deductions → expenses that directly keep your business running (advertising, office supplies, subscriptions, insurance, merchant fees, shipping).

• Shared expenses → things like phone, internet, mileage, or even part of your home if you qualify for the home office deduction.

• Personal deductions → items like health insurance premiums, certain medical costs, student loan interest, and charitable donations.
  

There’s a lot more you can deduct than you might think, which is why we created an entire guide to walk you through it: The Most Overlooked Small Business Deductions.

Tax FAQs: Can My Business Pay for My Health Insurance?

Sometimes, yes. Sometimes, no.

• Corporations → your health insurance should run through payroll.

• Partnerships or Sole Proprietors → the business can’t pay it directly, but you can still take a deduction for self-employed health insurance on your personal return.
  

You may also like: Health Insurance for Entrepreneurs: What Every Business Owner Needs to Know.

Tax FAQs: Can I Deduct Clothes, Hair, or Makeup?

Usually no… but there are a few exceptions:

• Branded clothing with your company logo.

• Required gear (aprons, uniforms, helmets, protective goggles, etc.).

• Clothing or products you’re contractually required to buy to promote or review them.
  

Pro tip: If the company reimburses you for those purchases, that counts as income.

Tax FAQs: Do You Need All My Receipts?

Not the shoebox, no.

As long as your bookkeeping is accurate and up to date, we don’t need every Starbucks receipt. The exception? Big purchases like vehicles, property, renovations, or equipment. (Basically, the stuff you’d probably save receipts for anyway.)

Tax FAQs: I Didn’t Make Any Money This Year. Do I Still Need to Report My Business?

Yup.

• Corporations → You must file every year once you’re officially registered.

• Sole Proprietors → If you had expenses, you’ll want to report them so you can claim a deduction for the loss.

Tax FAQs Wrap-Up: Less Stress, More Clarity

At the end of the day, tax season doesn’t have to feel like a mystery novel you’re scrambling to solve. When you know what’s deductible and keep your records in order, you’re setting your business up for less stress and more savings.

Think of this Tax FAQs guide as a gift of clarity, so you can spend less time second-guessing and more time focusing on the work you actually love.

Still have questions? Book a tax consultation with our team.  Book a call here.

P.S. If you’re not already on our email list, now’s the perfect time to join. You’ll get easy, practical tips delivered straight to your inbox, so managing your business finances feels way less overwhelming (and dare we say, empowering).