Starting a business is expensive. You’re stretching every dollar, reinvesting into growth, and making strategic decisions daily. But here’s the kicker: if you’re not taking advantage of tax-saving opportunities, you’re literally handing free money to the IRS.
At Insogna CPA, a top-rated Austin, Texas CPA firm, we work with startup founders like you to maximize deductions, claim tax credits, and keep more cash in your business where it belongs. Let’s break down where most startups go wrong and how you can fix it.
The Startup Tax Problem: You’re Missing Out on Savings
Most startup founders don’t realize how much they’re overpaying in taxes simply because they don’t know what’s deductible.
Common Ways Startups Bleed Money on Taxes:
- Skipping deductions for home office, software, and marketing.
- Not claiming tax credits (like the R&D credit that refunds payroll taxes).
- Choosing the wrong business structure, leading to extra self-employment taxes.
- Not planning for quarterly tax payments, which results in IRS penalties.
Sound familiar? You’re not alone. The good news is, these mistakes are 100% fixable.
The Solution: How to Keep More of Your Hard-Earned Cash
1. Track Every Expense Like Your Business Depends on It (Because It Does)
If you’re not tracking expenses, you’re leaving tax deductions on the table. And no, waiting until April to figure it out isn’t a strategy, it’s a guaranteed way to overpay.
Here’s What You Can Deduct as a Startup:
- Business registration fees & legal costs (your LLC setup wasn’t free—write it off!).
- Home office expenses (yes, your Wi-Fi bill counts).
- Marketing, branding & website costs (ads, logos, even that fancy product shoot).
- Software & subscriptions (QuickBooks, Shopify, Slack—all deductible).
How to Stay on Top of It:
✔ Use QuickBooks Online to track every dollar.
✔ Separate business & personal finances (if you’re still using one account, fix that today).
✔ Save digital receipts using Expensify or Hubdoc—paper receipts are a nightmare.
How Insogna CPA Helps: We review your expenses, clean up your books, and make sure you’re claiming every deduction possible.
2. Claim the R&D Tax Credit (Even If You Think You Don’t Qualify)
Think the R&D Credit is just for big tech companies? Nope. If you’re developing software, testing new products, or improving processes, you might qualify for thousands in payroll tax refunds.
Eligible Activities Include:
✔ Software & app development (even if you don’t have a patent).
✔ Prototyping & product testing (A/B testing counts!).
✔ Process improvements that require experimentation.
Why This Matters: Startups can use the R&D Credit to offset payroll taxes, freeing up cash for growth.
How Insogna CPA Helps: We’ll determine if you qualify, handle the paperwork, and get you the refund you deserve.
3. Choose the Right Business Structure (Your Tax Bill Depends on It)
The entity structure you pick today affects how much you pay in taxes for years to come.
Things to Consider:
✔ Should you start as an LLC or S-Corp? (Hint: If you’re paying yourself, an S-Corp can save thousands on self-employment taxes.)
✔ Are you registering in the right state to avoid expensive franchise taxes?
✔ Do you need multi-state tax compliance if you’re selling nationwide?
How Insogna CPA Helps: We’ll set up your business structure the right way from day one, so you save money instead of scrambling later.
4. Plan for Quarterly Taxes (So the IRS Doesn’t Come for You)
If you’re self-employed or running a startup, the IRS expects you to pay quarterly estimated taxes. Skip them, and you’ll face penalties and surprise tax bills and no one wants that.
How to Stay Ahead:
✔ Calculate your estimated taxes based on actual income (not a guess).
✔ Set up automated payments so you never miss a deadline.
✔ Work with an Austin small business accountant (that’s us!) to avoid penalties.
How Insogna CPA Helps: We’ll calculate and adjust your payments so you’re paying just the right amount—no more, no less.
5. Work with a CPA Who Actually Gets Startups
Googling tax strategies will only get you so far. You need a CPA who understands startup finances and how to legally reduce your tax bill.
What a Startup CPA Does for You:
✔ Find deductions & credits you didn’t even know existed.
✔ Keep your books clean to avoid IRS issues.
✔ Build a tax strategy that helps your business scale without tax surprises.
Think of it this way: You wouldn’t launch a product without a marketing plan so why run a business without a tax strategy?
How Insogna CPA Helps: We go beyond tax prep, we help startups scale smarter by reducing their tax burden year-round.
The Real Cost of Ignoring Tax Savings? Overpaying by Thousands
Let’s break it down: If you miss $10,000 in deductions and your tax rate is 25%, that’s $2,500 extra you just handed to the IRS.
Multiply that over a few years, and you’ve wasted tens of thousands—money that could have been used to:
- Scale your business.
- Hire your first employees.
- Attend industry events to grow your network.
Why give the IRS more than you need to?
Let’s Make Sure You’re Keeping More of Your Startup’s Profits
At Insogna CPA, a leading Austin accounting firm, we specialize in helping startups maximize deductions, reduce taxable income, and stay compliant. Whether you’re an early-stage founder or scaling fast, we’ve got your back.
📞 Stop leaving money on the table—contact Insogna CPA today and let’s get your tax strategy working for you!