Small Business Tax Filing: Six Things That Actually Save You Money

Filing taxes for a small business can feel overwhelming. But it doesn't have to be that way.

Almost everything that lowers a small-business tax bill happens during the year, not at the appointment. Here is what actually matters, in the order it matters.

1. Open a separate bank account

If there is one thing on this list to do this week, it is this one. A free business checking account, and everything for the business goes through it.

Not because the IRS requires it — because when your business and grocery money are in the same account, every single transaction has to be sorted by hand later. That is slow, it is easy to miss deductions, and if you are ever asked to prove a number, a mixed account is the hardest thing to defend.

2. Track your miles as you go

Mileage is usually the biggest deduction for drivers and anyone who works out of their vehicle, and it is also the one most often lost.

If you drive for an app, the platform gives you a mileage total — that is what we use. If you do not drive for an app, you need your own record: date, where you went, why, and how many miles. A free mileage app does this in the background. A notebook in the glovebox also works. An estimate made in April does not.

One thing specific to 2026: the IRS changed the mileage rate partway through the year — 72.5 cents a mile through June 30, then 76 cents from July 1 on. That means your miles have to be split by date. A single yearly total will not be enough this time.

3. Photograph receipts the day you get them

Not filed, not organized — just photographed. A picture on your phone the moment you walk out of the store beats a shoebox you sort in March, because the shoebox always has fading thermal paper in it and receipts that never made it home.

4. Collect W-9s before you pay anyone

If you pay a contractor, get their W-9 before the first check, not in January when you need to file their 1099. Chasing someone for a tax ID after the work is done and the money is spent is a special kind of miserable.

The threshold is changing, so know which year you are in: for 2025, you file a 1099-NEC for anyone you paid $600 or more. Starting with 2026 payments, that rises to $2,000. Either way, get the W-9 up front — it costs nothing and it saves January.

5. Set money aside for quarterly payments

Nobody withholds tax from self-employment income. That is on you, and between income tax and self-employment tax it adds up faster than most people expect.

Move a percentage into a separate savings account every time you get paid — not at the end of the month, when it is already gone. If you have never done quarterly estimated payments, call me and we will work out a number that fits your situation rather than guessing.

6. Do not wait until April to ask

The questions that save real money — should I buy this now or in January, do I need to give this person a 1099, is this trip deductible — have to be asked before the year closes. By April the year is finished and I can only report what happened.

A call in October is worth more than an hour in April.

Behind on your books?

If your records are a year behind, or three, that is normal and it is fixable. Link your bank to Xero and it catches up automatically, or bring me what you have and I will organize it by hand. Either way, no lecture.