Business CPA

Summary of What This Blog Covers:

• Discover seven commonly missed business tax deductions that can significantly lower your tax bill: From home office deductions to software subscriptions, this blog walks through practical write-offs that entrepreneurs often overlook. Each with specific IRS rules and how to track them properly.
  
  
• Learn how proper documentation and form filing protect your deductions: You’ll understand why forms like the W9, 1099 NEC, 1099K, and FBAR are essential to stay compliant and support every deduction you take—especially if you work with contractors or handle international funds.
  
  
• Understand the financial impact of missed deductions on self-employment tax and audit risk: This guide explains how failing to deduct legitimate expenses increases both income tax and self-employment tax, and why inconsistent reporting may trigger an IRS audit.
  
  
• See how Insogna CPA helps service business owners optimize deductions and tax planning year-round: As a leading CPA firm in Austin, Texas, Insogna CPA provides strategic support, from identifying deductions to filing all required tax forms, ensuring clients reduce tax liability while staying compliant.

Tired of Overpaying on Taxes? Let’s Fix That.

You and I both know that you didn’t start your business so you could become an expert in tax law. You started because you’re good at what you do. You serve your clients, solve real problems, and provide value every day.

But here’s the hard truth: you might be giving the IRS more than you legally have to.

And not because you’re doing anything wrong. But because like most business owners, you’re too busy running your business to dig through every tax code nuance or hunt down every deduction.

That’s where we come in.

At Insogna CPA, a highly-rated CPA firm in Austin, Texas, we help entrepreneurs like you find and claim the deductions they’re missing and turn tax season from a pain point into a strategic advantage.

If you’ve ever Googled “tax preparer near me” or “Austin small business accountant” and felt overwhelmed by options, don’t worry. This guide is going to walk you through seven overlooked tax deductions, why they matter, and how we help you track and maximize every last one.

What’s a Business Tax Deduction And Why Should You Care?

A business tax deduction reduces the amount of income you have to pay tax on. It’s that simple.

If your business earns $150,000 and you have $50,000 in deductible expenses, you’re only taxed on $100,000. That’s less tax paid, more money kept, and less stress next April.

The IRS requires that deductions be “ordinary and necessary” for your business. That means the expense should be common for your industry and directly connected to running your business.

Don’t worry, we help interpret what that means in real life. And trust us, the IRS isn’t going to remind you what you forgot to deduct. That’s our job.

1. Home Office Deduction

You Work From Home? Let’s Deduct It Properly.

This one causes confusion because it’s so often misused. But when done right, it’s a legitimate way to save.

What Qualifies:

• A designated area used exclusively and regularly for business
  
  
• A home office that’s your primary place of business, or where you meet clients
  
  
• A workspace used for admin or management tasks if your main work happens elsewhere
  
  

Deduction Options:

• Simplified method: $5 per square foot, up to 300 square feet
  
  
• Actual expense method: Deduct a percentage of your mortgage/rent, utilities, property taxes, and insurance
  
  

Common mistake: Trying to deduct your whole house. The IRS is not a fan of that.

How We Help:

As your Austin, TX accountant, we evaluate your space and usage, calculate the most advantageous method, and ensure everything is cleanly documented to avoid red flags.

2. Inventory Obsolescence Write-Offs

Got Dead Stock? Turn It Into a Deduction.

If you sell products, your inventory isn’t just an asset, it’s a potential tax deduction when it goes obsolete.

What’s Deductible:

• Unsellable or expired merchandise
  
  
• Inventory damaged beyond repair
  
  
• Obsolete goods that can’t be sold at full value
  
  

Requirements:

• Accurate records of cost, valuation, and write-off timing
  
  
• Clear evidence that the items no longer hold fair market value
  
  

Pro Tip: Don’t just toss inventory. Document the value drop, and record the disposal if applicable.

How We Help:

We help you determine when and how to record the write-off, and how to apply it against your income to reduce your self-employment tax liability.

3. Marketing & Advertising

Growth Isn’t Free And It’s Deductible.

If you’re not writing off your marketing costs, you’re giving up one of the easiest and most IRS-approved deductions out there.

Deductible Marketing Costs:

• Facebook, Instagram, LinkedIn, and Google Ads
  
  
• Website design, branding, logo work
  
  
• CRM tools like HubSpot or Salesforce
  
  
• SEO services and digital content production
  
  
• Print materials, signage, and promotional swag
  
  

Even the monthly Canva Pro fee counts.

How We Help:

As your tax advisor near you, we’ll help you categorize these expenses correctly in your chart of accounts, track recurring charges, and separate what’s promotional from personal.

4. Business Equipment & Depreciation

Bought Big-Ticket Items? Let’s Deduct Them Properly.

When you invest in equipment: computers, cameras, office furniture, you have options for how you deduct those costs.

Your Two Main Paths:

• Standard Depreciation: Deduct the cost over multiple years
  
  
• Section 179: Deduct the full cost in the year it’s placed in service (up to a limit)
  
  

Deductible Items:

• Office equipment and furniture
  
  
• Laptops, tablets, and work phones
  
  
• Business-use vehicles (with caveats)
  
  
• Leasehold improvements and commercial build-outs
  
  

Confused about Section 179 vs. bonus depreciation? We’ll show you the side-by-side.

How We Help:

We analyze which method will save you more based on your income, growth goals, and tax bracket and ensure it’s properly documented in your return.

5. Health Insurance Premiums for Self-Employed

Yes, You Can Deduct This If You Know the Rules.

If you’re self-employed and paying for your own health insurance, it may be 100% deductible—provided you meet the criteria.

What’s Covered:

• Health, dental, and vision insurance premiums
  
  
• Long-term care insurance
  
  
• Plans covering yourself, your spouse, and dependents
  
  

Catch: If your spouse’s employer offers you coverage, you can’t claim your own.

How We Help:

As a licensed CPA in Austin, Texas, we integrate health insurance deductions into your overall tax plan and explore whether a health savings account (HSA) or defined benefit plan could boost your savings further.

6. Business Travel & Meals

That Coffee with a Client? It Might Be Deductible.

This deduction is often misunderstood but extremely valuable when done right.

Deductible:

• Flights, hotels, rental cars, and rideshare to client sites or events
  
  
• Meals while traveling for business (50% deductible)
  
  
• Client dinners or team meals (with documentation)
  
  

Not Deductible:

• Meals on personal errands
  
  
• Spouse travel (unless they’re an employee)
  
  
• Entertainment expenses (the IRS nixed those in 2018)
  
  

How We Help:

We set up clean categories in your bookkeeping software (like QuickBooks Self-Employed) to separate personal and business travel, and show you how to meet the IRS’s documentation requirements.

7. Software & Subscriptions

Monthly Fees Are Sneaky But Deductible

From task managers to finance tools, those recurring charges are tax deductions waiting to happen.

Commonly Missed Deductions:

• QuickBooks Self-Employed, FreshBooks, Xero
  
  
• Zoom, Slack, Dropbox
  
  
• Canva, Trello, Asana, ClickUp
  
  
• Adobe Creative Cloud, design tools
  
  
• Any cloud-based software used for your business
  
  

That $15/month adds up to $180/year. Across 6–8 platforms? That’s a real tax break.

How We Help:

As your certified public accountant near you, we help track and tally these expenses automatically, so nothing gets left out of your year-end deductions.

Bonus: Forms You Can’t Afford to Ignore

Every deduction you claim must be backed by clean, accurate filings.

Critical Forms:

• W9 Form: You need this before paying a contractor
  
  
• 1099 NEC: Must be sent to any contractor earning $600+
  
  
• 1099K: You’ll get this if payment processors (like PayPal, Stripe, Square) pay you more than $600
  
  
• FBAR Filing (FinCEN Form 114): Required if your foreign accounts exceed $10,000 total during the year
  
  

Miss a form or file late? Penalties range from $50 to $10,000+ per violation.

Our certified CPAs and enrolled agents prepare and file these forms accurately and handle FBAR filing if needed.

What Happens If You Miss These Deductions?

When you skip legitimate business deductions:

• You pay more income tax than necessary
  
  
• You increase your self-employment tax burden
  
  
• You may trigger an audit due to inconsistent reporting
  
  

And worst of all, you lose money that could’ve been reinvested into your business, your retirement, or your peace of mind.

That’s why working with a proactive, detail-obsessed CPA firm in Austin, Texas (that’s us) makes all the difference.

What We Do at Insogna CPA

When you work with us, you get more than tax prep. You get:

• Year-round tax planning strategy
  
  
• Deductions customized to your business model
  
  
• Clean, IRS-compliant documentation
  
  
• Expert handling of W9 tax forms, 1099 NEC forms, 1099K income, and FBARs
  
  
• Support from a full team of certified professional accountants, chartered public accountants, and Austin tax accountants
  
  

Whether you’re looking for a tax professional near you, searching for CPA firms in Austin, Texas, or ready to work with a licensed CPA who actually understands your world, we’re here.

Final Thoughts: You Work Too Hard to Give Away Tax Money

Every dollar you don’t deduct is money you’re donating to the IRS.

But when you partner with a strategic, experienced Austin accounting service like Insogna CPA, you gain more than compliance. You gain confidence.

Schedule Your Tax Planning Session Today

Let’s make this the year you stop leaving money on the table.

Book your consultation with Insogna CPA now and let’s review your deductions, optimize your filings, and build a tax plan that works as hard as you do.

Because when your tax plan is aligned with your growth, everything gets easier.

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Summary of What This Blog Covers:

• Understand why your current business structure might be costing you more in taxes: Many business owners stick with their original entity (like a sole proprietorship or LLC) without realizing it’s no longer the most tax-efficient option. This blog explains how restructuring, especially electing S-Corp status, can help reduce self-employment tax and optimize overall tax liability.
  
  
• Learn how to pay yourself the right way to avoid overpaying: From taking a reasonable salary under an S-Corp to reimbursing personal expenses properly and leveraging retirement contributions, this blog outlines smart compensation strategies that save money and ensure compliance.
  
  
• Avoid costly mistakes with inter-entity transactions and tax forms: Whether you own multiple businesses or work with contractors, this blog covers how to correctly document transfers, handle 1099 NEC and 1099K reporting, and manage W9 forms—all with help from a certified CPA near you.
  
  
• Stay compliant across state lines and international borders: Discover how multi-state operations and foreign financial accounts (like PayPal, Wise, or crypto) can trigger tax obligations and FBAR filing requirements, and how proactive, year-round tax planning from a trusted Austin CPA firm can keep you compliant and in control.

The Right Business Structure Can Save You Thousands

We’ve known each other a while, so let me ask you straight:

Are you still running your business with the same setup you chose when you filed your first LLC on LegalZoom… and haven’t thought about it since?

If you are and business is booming, you might be doing everything right except your tax strategy.

Because here’s the truth: choosing the wrong business structure, or not optimizing it as you grow, can cost you thousands in unnecessary taxes every single year.

At Insogna CPA, a top-rated CPA firm in Austin, Texas, we work with business owners across the service industry (consultants, creatives, agency founders, coaches, and more) who want to work smarter, not harder, when it comes to taxes.

Let’s walk through the key reasons you might be overpaying and how to build a tax-efficient structure that keeps more of your money where it belongs: in your business and your bank account.

Why Business Owners Overpay in Taxes (Without Realizing It)

It’s not that you’re ignoring the IRS—far from it. You’re filing on time. You’re trying your best with QuickBooks Self-Employed and maybe a 1099 tax calculator. But those tools aren’t telling you what you don’t know.

The Most Common Reasons You’re Overpaying:

• You’re still operating as a sole proprietor or single-member LLC, paying full self-employment tax on all your profits.
  
  
• You’ve outgrown DIY tools like TurboTax, but haven’t made the leap to work with a tax advisor near you.
  
  
• You’re paying yourself the wrong way, leaving money on the table.
  
  
• You haven’t reviewed your business structure in years.
  
  
• You own multiple businesses and are moving money between them without documentation or strategy.
  
  

These mistakes don’t just cause inefficiency, they create unnecessary risk and shrink your net income.

1. The Right Business Entity Can Save You Thousands

Let’s talk structure. Most business owners choose LLC status because it’s fast, flexible, and sounds official. But an LLC is just the beginning.

Entity Options to Consider:

• Sole Proprietor / Single-Member LLC: Simple, but you’re taxed on 100% of your profits. That means 3% self-employment tax on top of your federal income tax.
  
  
• S-Corporation: The IRS allows business owners to reduce self-employment tax by splitting their income into salary + distributions. This is where the savings come in.
  
  
• C-Corporation: Offers benefits if you’re raising capital or reinvesting in the business but watch out for double taxation.

We help you run these numbers using a self-employment tax calculator and assess when it makes sense to elect S-Corp status. If you’ve crossed the $50,000 profit mark, it’s time to evaluate.

2. How You Pay Yourself Matters A Lot

Once you’re making serious money, how you take income becomes just as important as how much you make.

Common Mistakes:

• Taking all profit as personal income (which triggers full self-employment tax)
  
  
• Paying business expenses from your personal account and not reimbursing yourself
  
  
• Forgetting to make retirement contributions, which could lower your taxable income
  
  

Smart Compensation Includes:

• A reasonable salary if you’re an S-Corp owner, issued through payroll
  
  
• Distributions for the remaining profit, which avoid self-employment tax
  
  
• An accountable reimbursement plan for personal expenses paid on behalf of the business
  
  
• Contributions to a Solo 401(k) or SEP IRA
  
  

We help clients set up compliant payroll, prepare W2 forms, and track W9 forms and 1099 NEC forms for contractors. As your certified CPA near you, we structure every payment to benefit you not the IRS.

3. Own Multiple Businesses? Don’t Overlook Inter-Entity Planning

A lot of our clients have more than one business: a consulting agency, a coaching brand, and maybe a product shop on Shopify. That’s great. But how you move money between those entities matters.

Inter-Entity Mistakes That Cost You:

• Failing to document loans or reimbursements
  
  
• Charging management fees without backing them up with actual agreements
  
  
• Misclassifying expenses, which can lead to double taxation or IRS scrutiny
  
  

What We Do:

• Help you structure intercompany transfers with clean accounting
  
  
• Document loans, fees, and reimbursements with IRS-friendly language
  
  
• Ensure you’re filing all necessary forms, including 1099 forms and keeping track of contractor payments
  
  

These are the kinds of details DIY tax software won’t catch but a chartered professional accountant at Insogna CPA will.

4. Don’t Forget the Forms, The IRS Won’t

If you’re paying contractors, processing payments through platforms, or holding money in international accounts, there are forms and filings you need to stay compliant.

Important Forms You Need to Know:

• W9 Tax Form: Collect this from any contractor you pay $600+
  
  
• 1099 NEC Form: Used to report payments to those contractors
  
  
• 1099K: If you receive payments through third-party platforms like Stripe or PayPal over $600
  
  
• FBAR Filing (FinCEN Form 114): Required if you hold more than $10,000 in foreign financial accounts (even temporarily)
  
  

Missing any of these? You could face penalties even if the error was unintentional.

Our team of tax professionals near you keeps your compliance clean and your filings current whether you operate locally or globally.

5. Multi-State? Multi-Problems… Unless You Plan Ahead

Let’s say your business is based in Texas (no income tax—high five!), but you’re selling to clients in California, New York, or Florida.

If you cross revenue thresholds in other states, you might trigger:

• Sales tax nexus
  
  
• Franchise tax obligations
  
  
• State income tax filing requirements
  
  

Every state is different. And if you’re shipping goods, teaching online, or working remotely, you may owe taxes in more places than you think.

As your Austin accounting firm, we help you:

• Register where necessary
  
  
• Stay under nexus thresholds where possible
  
  
• File appropriately when multi-state activity kicks in
  
  

6. International Accounts? You Might Need to File an FBAR

The FBAR (Foreign Bank Account Report) isn’t just for big corporations with offshore bank accounts.

If you have:

• More than $10,000 across any foreign accounts, including business checking, PayPal, or Wise
  
  
• Crypto wallets hosted on offshore exchanges
  
  
• Any joint foreign financial accounts
  
  

…you may be required to file FinCEN Form 114 annually.

Non-compliance can trigger penalties starting at $10,000 per violation.

Let a licensed CPA or enrolled agent from Insogna CPA handle this filing correctly, as part of your broader tax preparation services.

7. Tax Planning Isn’t One-and-Done

If your business is growing, your tax strategy shouldn’t be the same as last year. We see too many business owners only talk to their CPA once a year, usually in March or April, and get stuck reacting instead of planning.

What Year-Round Tax Planning Should Include:

• Quarterly Reviews: Income projections, deduction optimization, and payment planning
  
  
• Estimated Tax Payment Support: No more guessing, just clean numbers
  
  
• Retirement Contribution Strategy: Build wealth while cutting taxes
  
  
• Entity Review: Is your current setup still the most tax-efficient?
  
  
• IRS Notices: We handle those too, so you don’t have to sweat the fine print
  
  

We’re a CPA firm in Austin, Texas that believes in coaching not just compliance. You don’t just get tax prep, you get a partner.

Final Thoughts: Stop Overpaying and Structure Smarter

You’ve already put in the hard work to build a successful business. Now it’s time to make sure your structure, compensation, and compliance strategy match the level you’re operating at.

What We Do at Insogna CPA:

• Evaluate your business entity and recommend changes for tax efficiency
  
  
• Set up payroll, owner distributions, and reimbursement plans
  
  
• Handle tax filings: W9s, 1099 NECs, 1099K, FBARs, and more
  
  
• Guide you through multi-state and international compliance
  
  
• Provide proactive, year-round tax strategyno t just tax season stress
  
  

Whether you’ve been Googling “CPA near me” or asking around for a tax accountant in Austin who speaks fluent entrepreneur, we’re here for you.

Book Your Strategy Session Today

At Insogna CPA, we help small businesses across industries get their tax structures right and keep more of what they earn. Whether you’re self-employed, managing multiple LLCs, or just tired of sending more to the IRS than you need to, we’re here to help.

Schedule your consultation today with a team that doesn’t just prepare your taxes, we help you master them.

Because when your business structure works for you, your money works harder too.

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Summary of What This Blog Covers:

• Identify the most common tax pitfalls for service-based business owners: From missed deductions to confusing sales and payroll tax rules, this guide highlights how everyday oversights can cost business owners thousands and how to fix them.
  
  
• Understand the right way to handle self-employment tax, business structure, and multi-state filings: Learn how to reduce your tax burden with the right entity setup (like an S-Corp) and stay compliant across state lines with guidance from a trusted Austin CPA.
  
  
• Know when it’s time to move beyond DIY tax software: Discover the limitations of tools like TurboTax and QuickBooks Self-Employed when your business grows, and why working with a local tax professional near you makes all the difference.
  
  
• Leverage year-round tax planning to maximize savings and avoid surprises: With proactive guidance from a small business CPA in Austin, you’ll stay ahead of quarterly taxes, navigate IRS forms like the W9 and 1099 NEC, and ensure full compliance with FBAR reporting if you hold foreign accounts.

A Straight-Talking Guide from Your Favorite Austin CPA Firm

Let’s not pretend taxes are the highlight of your business calendar.

You’ve got clients to serve, schedules to juggle, invoices to send, and maybe—just maybe—some personal time to enjoy between projects. But one thing keeps sneaking up every quarter (and especially in April): your tax bill.

And it’s often more than it needs to be.

At Insogna CPA, a leading CPA firm in Austin, Texas, we’ve helped hundreds of service-based business owners (consultants, designers, fitness professionals, agency founders, therapists, coaches) get a handle on their tax strategy, reduce their self-employment tax burden, and grow with confidence.

You don’t need to be a tax expert. You just need a clear plan and the right partner. So let’s dive in.

1. Stop Leaving Deductions on the Table

You’re Probably Missing More Than You Think

You’d be shocked how many service business owners underclaim deductions. Either out of fear, confusion, or just sheer busyness.

Top Deductions You Might Be Missing:

• Home Office Deduction: If you work from home even just one room, you may qualify to deduct a portion of your rent or mortgage, utilities, and internet.
  
  
• Business Mileage: All those drives to client meetings, networking events, supply runs? Track them. Use apps like MileIQ or QuickBooks Self-Employed.
  
  
• Marketing Expenses: Paid ads, social media consultants, branding services, SEO subscriptions… it all adds up.
  
  
• Professional Services: Fees paid to your Austin Texas CPA, legal counsel, or even a business coach are deductible.
  
  
• Software & Tools: Your Canva Pro subscription? Your scheduling platform? Your CRM or Slack premium account? Also deductible.
  
  

Want to know the most common mistake we see? Business owners paying out of pocket and never logging it. If you don’t track it, you can’t deduct it.

With guidance from a certified public accountant near you, you can build a deduction plan that keeps more cash in your account legally.

2. Understand the Difference Between Sales Tax and Payroll Tax

Confuse Them at Your Peril

Many service business owners don’t know when sales tax applies, or how to properly manage payroll tax if they’ve hired help or set up an S-Corp.

Sales Tax: Do You Need to Collect It?

• In Texas, most services are not subject to sales tax but some (like data processing, IT services, and certain repair services) are.
  
  
• If you sell products (e.g., merch, kits, eBooks), you’ll likely need to collect sales tax and remit it to the state.
  
  
• Not sure? A tax consultant near you can review your offerings and advise on compliance.
  
  

Payroll Tax: This Is a Big One

• If you pay employees or if you pay yourself a salary through an S-Corp, you’re responsible for payroll tax.
  
  
• That includes FICA taxes (Social Security and Medicare), federal and state withholding, and unemployment taxes.
  
  

The IRS is serious about payroll compliance. Penalties for misclassifying contractors or missing deposits are steep.

We help you set up compliant payroll systems, whether you’re issuing W-2s or collecting W9 tax forms from contractors.

3. DIY Tax Filing Works Until It Doesn’t

When It’s Time to Graduate from TurboTax

We love a good DIY project as much as anyone, but taxes? That’s one place where guesswork gets expensive.

Here’s Where DIY Falls Short:

• Missing Deductions: Software can’t ask the right questions about your unique service business.
  
  
• Overpaying: You might not realize you qualify for special deductions, credits, or business structures.
  
  
• Triggering Audits: Innocent mistakes like misclassifying income on a 1099 NEC form or forgetting a quarterly payment can draw attention from the IRS.
  
  
• Foreign Account Reporting: If you’re holding money abroad (yes, even through PayPal or Wise), you may owe FBAR filing
  
  

Signs You’ve Outgrown DIY Tools:

• You’re earning consistent six figures or more.
  
  
• You’re hiring contractors or employees.
  
  
• You’ve received a tax notice.
  
  
• You’re filing in multiple states or managing multiple income streams.
  
  
• You just don’t want to spend 20 hours sorting it out anymore.
  
  

That’s what a tax preparer near you is for. A good CPA doesn’t just file your taxes, they help design a strategy that grows with your business.

4. You Shouldn’t Be Thinking About Taxes Only in April

Smart Business Owners Think Ahead

Reactive tax prep is the #1 reason business owners get hit with unexpected tax bills, penalties, or missed opportunities.

We believe in year-round tax strategy not last-minute stress.

What Year-Round Planning Looks Like:

• Quarterly Reviews: We review income, deductions, and projections every 3 months before problems pop up.
  
  
• Estimated Tax Payments: We calculate your quarterly payments using your actual profit, not generic formulas.
  
  
• Deductions Calendar: From year-end equipment purchases to prepaying certain expenses, we help you time deductions for maximum impact.
  
  
• Multi-State Filing Guidance: If you’re teaching online, working remotely, or have clients in multiple states, we’ll help you navigate nexus rules.
  
  

We also track tools like the 1099 tax calculator, self-employment tax calculator, and QuickBooks Self-Employed to keep your tax plan accurate and actionable.

Bonus? You get fewer surprises and better sleep. You’re welcome.

5. Your Business Structure Should Match Your Goals

And Save You Money in the Process

Too many business owners stick with the sole proprietorship or single-member LLC they set up on day one even as revenue explodes.

That’s a mistake.

Why It Matters:

• A sole proprietor pays 3% self-employment tax on 100% of profit
  
  
• An LLC taxed as an S-Corp pays that tax only on the salary portion of income
  
  
• The rest? Taken as distributions, not subject to self-employment tax
  
  

We’ve helped clients save $5K–$25K+ annually just by switching to the right structure.

Need help deciding if an S-Corp election makes sense? We’ll run the numbers and file the paperwork. We also help set up W-2 payroll, file 1099 NEC forms, and track contractor W9 forms with total compliance.

Work with a small business CPA in Austin who knows when it’s time to shift gears and how to make it painless.

6. If You Work Across State Lines, You Might Owe More Than You Think

Welcome to the Wild World of Multi-State Tax

Selling to clients in other states? Hosting live events or digital workshops? Shipping merch or digital goods? You may have created sales tax nexus or triggered multi-state income tax filing requirements without realizing it.

What to Watch For:

• Economic nexus thresholds (usually tied to revenue or transaction volume)
  
  
• Franchise or business activity taxes in certain states (like CA or NY)
  
  
• Sales tax collection requirements if you sell physical or digital goods
  
  

Don’t assume what works in Texas works elsewhere. Every state has different rules.

Let a tax professional near you who specializes in multi-state filings help you stay compliant and avoid penalties that can stack up fast.

7. Foreign Accounts? You May Be Required to File an FBAR

Have more than $10,000 combined across foreign bank accounts, crypto platforms, or international PayPal/Wise accounts?

Then you’re likely required to file the FBAR (Foreign Bank Account Report) using FinCEN Form 114 even if you don’t owe any tax on that money.

The Problem:

• Many small business owners don’t know about FBAR rules
  
  
• The IRS takes non-compliance seriously
  
  
• Penalties for unfiled FBARs can hit $10,000+ per violation even if you didn’t know you had to file
  
  

Work with a chartered public accountant or enrolled agent who can handle both your tax preparation services and your FBAR filing requirements.

Let’s Simplify, Strategize, and Save You Money

Your service business deserves a tax strategy that keeps up with your ambition. And your finances deserve more than a once-a-year “good luck” filing.

At Insogna CPA, we help service industry owners across the U.S.:

• Reduce tax liabilities through strategic business structuring
  
  
• Maximize deductions legally and efficiently
  
  
• Stay compliant with IRS, payroll, multi-state, and FBAR rules
  
  
• File accurate, optimized returns year after year
  
  
• Plan for the future, not just report on the past
  
  

Looking for a trusted CPA near me? Need a responsive, detail-driven Austin accounting service that speaks your language?

You’ve found it.

Book Your Strategy Session Today

Stop flying blind. Stop overpaying. Start optimizing your taxes with a partner who gets it and gets you.

Schedule a consultation with Insogna CPA today and let’s build a smarter, stronger, and simpler tax strategy for your service-based business...

Because when your money works smarter, you get to do more of what you love.

Summary of What This Blog Covers:

• Learn the Most Common Tax Mistakes Small Business Owners Make: From missing deductions and self-employment tax savings to using the wrong business structure, this blog highlights the top errors that quietly cost entrepreneurs thousands each year.
  
  
• Understand How to Legally Lower Your Tax Burden: Get practical strategies from a certified public accountant like tracking expenses accurately, filing quarterly taxes on time, and switching to an LLC or S-Corp to reduce self-employment tax.
  
  
• Avoid IRS Trouble and Stay Compliant Across State and International Borders: This blog explains how sales tax, multi-state nexus rules, and FBAR filing requirements can affect your business and why proactive planning with an experienced CPA is essential.
  
  
• Discover the Power of Strategic, Year-Round CPA Support: Learn why DIY tax software often falls short for growing businesses, and how working with a trusted Austin CPA firm like Insogna CPA can unlock real savings and long-term financial clarity.

Let’s Talk About That Tax Bill You’re (Probably) Overpaying And How to Fix It

Let’s have that honest heart-to-heart, shall we?

You’ve been building your business with everything you’ve got: early mornings, late nights, big ideas, and bigger invoices. But if you’re like most entrepreneurs, there’s one piece of the puzzle that’s costing you more than it should: your taxes.

And no judgment here, it’s a system built to be confusing. Between IRS deadlines, business structure decisions, and evolving tax laws, it’s easy to make well-meaning mistakes that drain your cash flow. The good news? With the right plan and the right CPA in Austin, Texas, you can fix them.

Here’s what we see time and time again at Insogna CPA, your go-to team of small business CPAs in Austin who specialize in helping founders like you stop overpaying and start optimizing.

1. Not Tracking Business Expenses (AKA: Leaving Free Deductions on the Table)

Think of business expenses like coupons for your taxes. Every expense you forget to track? That’s a coupon you’re not using and you’re overpaying because of it.

Common Mistakes:

• Using the same credit card for personal and business purchases
  
  
• Failing to record software subscriptions, mileage, or that working lunch with a client
  
  
• Forgetting to document small recurring expenses, which can add up to thousands a year
  
  

How to Fix It:

• Open a dedicated business bank account and credit card
  
  
• Use tools like QuickBooks Online, Xero, or Wave
  
  
• Store receipts digitally with Hubdoc or Expensify
  
  
• Consult a tax accountant near you to identify overlooked deductions
  
  

Pro tip: A $30 Zoom subscription, $120 in parking fees, and $60/month on marketing tools can easily snowball into $5K+ in deductions across a year.

Need help getting your books in shape? That’s what our Austin accounting service is here for.

2. Overpaying Self-Employment Taxes

If you’re still a sole proprietor or single-member LLC, you’re likely paying 15.3% self-employment tax on your entire net income. That’s a silent thief right there.

Example:

Let’s say your business earns $100,000 in profit:

• Sole Proprietor → You owe $15,300 in self-employment tax
  
  
• LLC with S-Corp election → You pay yourself a $50K salary and only pay self-employment tax on that amount
  
  

The Mistake:

• Not reviewing your entity structure annually
  
  
• Missing the chance to elect S-Corp status
  
  
• Not consulting a tax advisor near you to help calculate “reasonable salary” and avoid IRS red flags
  
  

At Insogna CPA, we guide you through S-Corp formation, handle your Form 2553, and even set up compliant payroll.

This is one of the fastest, legal ways to reduce your tax liability and we’ve helped clients save $5K–$20K per year just by structuring things correctly.

3. Missing Legitimate Business Deductions

Every deduction reduces your taxable income. If you’re not claiming everything you qualify for, you’re voluntarily giving the IRS a bonus.

Most Commonly Missed Deductions:

• Home office space
  
  
• Business use of your car, including mileage or actual expenses
  
  
• Continuing education, online courses, books, and certifications
  
  
• Software tools (Slack, Canva, Adobe, etc.)
  
  
• Professional services like your CPA, legal support, or marketing consultant
  
  

The Fix:

• Deduct every eligible expense (don’t guess—verify with your certified CPA)
  
  
• Maintain clean records—no receipt, no deduction
  
  
• Work with a proactive tax preparer near you to categorize expenses correctly
  
  

Think you’re too small to qualify? We’ve helped solopreneurs unlock thousands in deductions they never thought they could take.

4. Missing Quarterly Tax Payments

Skipping estimated payments is like skipping oil changes, it doesn’t seem urgent until something breaks. And in this case, that something is usually your cash flow in April.

IRS Due Dates:

• April 15
  
  
• June 15
  
  
• September 15
  
  
• January 15 (of the following year)
  
  

The Mistake:

• Not setting aside funds throughout the year
  
  
• Guessing your estimated tax amount
  
  
• Getting hit with IRS penalties (plus interest)
  
  

How to Fix It:

• Work with an Austin, TX accountant to estimate your tax liability based on actual profit
  
  
• Allocate 25–30% of each payment to a separate tax savings account
  
  
• Pay on time using EFTPS or IRS Direct Pay
  
  

Our clients love that we automate reminders and help calculate their quarterly payments so there are no surprises come April.

5. Choosing the Wrong Business Structure

Your entity type doesn’t just affect your taxes. It affects your liability, credibility, and ability to scale. And yet, many business owners never revisit their setup after year one.

The Mistake:

• Operating as a sole prop when an LLC or S-Corp offers better protection and savings
  
  
• Choosing an LLC but failing to elect S-Corp taxation
  
  
• Not reviewing your entity as profits grow
  
  

The Fix:

• Schedule an annual entity review with your certified public accountant
  
  
• Transition to an LLC or S-Corp once you hit consistent profits of $50K+
  
  
• File the right IRS forms on time (we’ll handle it for you)
  
  

Remember, your entity should evolve as your business does. And at Insogna CPA, we’re experts at helping small business owners make that transition smoothly.

6. Overlooking Multi-State Tax Obligations

E-commerce sellers, remote workers, and coaches, this one’s for you.

If your clients or customers are in multiple states, or if you ship across state lines, you may owe sales tax, income tax, or even franchise tax in other states.

The Mistake:

• Assuming you only need to file taxes in the state where your business is registered
  
  
• Ignoring economic nexus laws and sales tax thresholds
  
  
• Failing to register for required state-level taxes
  
  

The Fix:

• Use platforms like TaxJar or Avalara to monitor multi-state sales
  
  
• Work with a CPA firm in Austin, Texas that understands multi-state tax strategy
  
  
• Register and file in the necessary states proactively not reactively
  
  

Texas may be friendly on state income tax, but other states aren’t as lenient. The right advisor will help you stay compliant, wherever your customers live.

7. Trusting DIY Tax Software to Do It All

TurboTax is great for a W-2 and a couple of donations.

But as soon as you’re running payroll, deducting travel, and juggling client invoices? You’ve outgrown it.

The Mistake:

• Believing tax software is “good enough” for your business
  
  
• Filing without professional review
  
  
• Lacking a forward-looking strategy
  
  

The Fix:

• Partner with a tax professional near you who understands your industry and income model
  
  
• Build a customized tax strategy not just a year-end file-and-pray routine
  
  
• Meet quarterly with a certified CPA for check-ins, especially as you scale
  
  

Your business deserves more than autofill and hope. With Insogna CPA, you get insight, accuracy, and a strategy that works year-round.

Bonus: Forgetting About FBAR Filing (If You Have Foreign Financial Accounts)

Do you have more than $10,000 across foreign accounts, including crypto platforms or PayPal accounts tied to foreign banks?

If yes, you may be required to file an FBAR (FinCEN Form 114) annually even if there’s no income tied to it.

The Mistake:

• Failing to report foreign holdings
  
  
• Assuming small balances don’t need to be disclosed
  
  
• Missing the deadline and facing steep penalties
  
  

The Fix:

• Let your chartered professional accountant evaluate your foreign holdings
  
  
• File FBAR with your Form 1040 or separately as required
  
  
• Avoid penalties (even unintentional non-filing can cost thousands)
  
  

Our team handles FBAR filing for clients with international ties and keeps everything fully compliant with U.S. reporting rules.

Let’s Put a Stop to Costly Mistakes

Your business is too important to be losing money to preventable tax errors.

At Insogna CPA, we specialize in working with growing businesses and entrepreneurs to build strategies that not only protect your cash but grow it.

Here’s how we help:

• File accurate, optimized returns through our expert tax preparation services
  
  
• Help you reduce self-employment tax legally through S-Corp structuring
  
  
• Keep you compliant with multi-state and international filing requirements
  
  
• Offer year-round planning and support, not just once-a-year filing
  
  

Whether you’re looking for a tax preparer near you, a trusted Austin accounting firm, or just someone who speaks your language (and IRS’s), we’ve got your back.

Book Your Tax Strategy Session Today

Stop leaving money on the table. Stop guessing your way through tax season.

Let’s build a smarter, simpler, and more profitable tax plan together.

Schedule a consultation with Insogna CPA, your dedicated team of Austin tax accountants, enrolled agents, and licensed CPAs, and let’s make tax season something you look forward to.

Because when your money works smarter, you do too...

Choosing the Right Business Structure: Don’t Leave Money (or Protection) on the Table

So, you started a business. Awesome! You’re making money, gaining clients, and things are moving in the right direction. But now you’re wondering:

“Should I stay a sole proprietor, or is it time to form an LLC?”
“Will an LLC save me money on taxes?”
“Do I actually need legal protection, or is that just for “big” businesses?”

At Insogna CPA, a trusted Austin, Texas CPA firm, we help business owners make smart financial moves that protect their assets and keep more money in their pockets. Let’s break it all down so you can decide what’s right for you.

Sole Proprietorship vs. LLC: What’s the Difference?

Sole Proprietorship: The “Easy Start” Business Structure

• No paperwork required—just start making money!
• Simple tax filing—your business income is reported on your personal tax return (Schedule C).
• Full control—you’re the boss, no business partners to answer to.
• No legal protection—if your business gets sued, your personal assets (house, car, savings) are at risk.
• Higher self-employment taxes—you pay 3% in self-employment taxes on ALL your profit.

LLC (Limited Liability Company): More Protection, More Flexibility

• Separates personal & business assets—your personal savings and home are protected.
• Tax flexibility—choose how you’re taxed (LLC, S-Corp, or even C-Corp).
• More credibility—looks more professional to banks, investors, and clients.
• Some paperwork required—you’ll need to file with the state and possibly pay annual fees.
• Must maintain records—mixing personal and business finances can void liability protection.

Key Takeaway: A sole proprietorship is great for getting started, but an LLC offers legal protection and tax benefits—huge advantages as your business grows.

When Should You Switch from a Sole Proprietorship to an LLC?

If you’re making serious money, working with clients, or hiring employees, it’s time to think beyond a sole proprietorship.

1. You’re Making Over $50,000 a Year

Why? If your profits are growing, you could be overpaying in self-employment taxes as a sole proprietor.

As an LLC, you can elect S-Corp status, which allows you to pay yourself a salary and take distributions—cutting your self-employment tax bill significantly.

Example:
If your business profits are $100,000:

• Sole Proprietor: You owe $15,300 in self-employment tax.
• LLC taxed as an S-Corp: If you pay yourself a $50K salary, you only pay self-employment tax on that salary, saving thousands in taxes.

2. You Want to Protect Your Personal Assets

Why? Sole proprietors have zero liability protection. That means if someone sues your business, your personal assets (home, car, savings) are at risk.

An LLC creates a legal separation between your business and personal finances, limiting your liability in case of lawsuits, debts, or business losses.

Example: If a client sues over a contract dispute, they can’t go after your personal bank account if you’re an LLC.

3. You’re Hiring Employees (or Expanding)

Why? If you’re bringing on employees, securing business loans, or expanding into multiple states, an LLC is the smarter choice.

An LLC gives you more legal credibility, access to better funding, and a structure that can grow with your business.

Example: Banks and investors are more likely to fund an LLC than a sole proprietorship.

How an LLC Affects Your Taxes (And Can Save You Money!)

Switching to an LLC doesn’t automatically change how you’re taxed—but it gives you more options.

Your LLC Tax Options:

• Single-Member LLC: Taxed like a sole proprietor (Schedule C).
• Multi-Member LLC: Taxed like a partnership (Form 1065).
• LLC Taxed as an S-Corp: Can reduce self-employment taxes if your profits are high enough.

How Insogna CPA Helps:

• Determine if an S-Corp election makes sense for your business
• Help you set a reasonable salary for IRS compliance
• Ensure you’re not overpaying in taxes

Not sure which tax option is right for you? Let’s set up a tax planning session today!

Final Thoughts: Sole Proprietorship or LLC: Which One Is Right for You?

• Stick with a sole proprietorship if you’re a low-risk, part-time freelancer or side hustler making under $50K per year.
• Switch to an LLC if you want legal protection, tax flexibility, and a business structure that grows with you...

Not sure which business structure is right for you? Let’s talk. Schedule a business structure consultation with Insogna CPA today!

So, you’re thinking about ditching the 9-to-5 grind and going independent? Maybe you’re already consulting on the side and wondering if it’s time to make it official. Either way, one thing’s for sure: going from a W-2 employee to an independent contractor changes everything, especially when it comes to taxes and finances.

Before you take the leap, let’s talk about what this move actually means for your bottom line. From self-employment taxes to retirement planning, understanding the details now will save you from expensive surprises later. And if you’re looking for an Austin, Texas CPA who can help you make this transition smoothly, you’re in the right place. Let’s break it down.

W-2 Employee vs. Independent Contractor: What Really Changes?

Going independent isn’t just about setting your own hours and working in sweatpants. The way you get paid, handle taxes, and plan for the future is completely different. Here’s a side-by-side look at how things change:

The Tax Reality: What No One Tells You Before Going Independent

As a W-2 employee, taxes happen behind the scenes. Your employer withholds what’s needed, sends it off to the IRS, and you barely have to think about it. Easy.

As an independent contractor, it’s a whole different game. Suddenly, you’re in charge of setting aside money for income taxes, self-employment tax (yes, the full 15.3%), and quarterly estimated tax payments. Mess this up, and you’ll be writing a hefty check to the IRS at tax time.

How to Stay Ahead of Taxes as an Independent Contractor:

• Set aside 25-30% of every payment you receive for taxes.
• Make quarterly estimated tax payments to avoid IRS penalties.
• Work with an Austin tax accountant to keep your tax strategy airtight.

LLC or S-Corp? Choosing the Right Business Structure

Going independent means you get to decide how your business is structured. The default is sole proprietor, but at a certain income level, that’s not the smartest financial move. Here’s why:

Sole Proprietor (Default Setup for Independent Contractors)

• No formal business structure required.
• You report all income on your personal tax return.
• You pay self-employment tax on 100% of your earnings (ouch).

LLC (Limited Liability Company)

• Protects your personal assets from business liabilities.
• Still taxed as a sole proprietor unless you elect otherwise.
• Doesn’t automatically reduce self-employment taxes.

S-Corp (Best for Reducing Self-Employment Taxes at Higher Income Levels)

• You pay yourself a “reasonable salary,” and the rest as distributions.
• Distributions aren’t subject to self-employment tax, meaning more money stays in your pocket.
• Requires payroll setup and more bookkeeping.

Not sure which option makes sense for your business? A small business CPA in Austin can help you decide based on your income and long-term goals.

Quarterly Taxes: The New Reality You Can’t Ignore

If you’re used to a steady paycheck, quarterly taxes might feel like a rude awakening. Unlike a W-2 job where taxes are automatically withheld, independent contractors must send estimated tax payments to the IRS four times a year. Miss a payment, and you could get hit with penalties.

How to Stay on Top of Quarterly Taxes:

• Estimate your annual income and tax liability upfront.
• Set up a business savings account just for taxes.
• Work with an Austin accounting service to calculate the exact amount you should pay each quarter.

Retirement Planning: No More Employer 401(k) Match

One major downside to leaving a W-2 job? No more employer-sponsored retirement plans. But the upside? You have better options with higher contribution limits.

Best Retirement Plans for Independent Contractors:

• Solo 401(k) – Ideal for high earners who want to max out tax-deferred savings.
• SEP IRA – Easier to set up and allows large contributions based on income.
• Traditional or Roth IRA – Great for additional tax-advantaged savings.

A tax advisor in Austin can walk you through the best setup for long-term financial success.

Final Thoughts: Should You Make the Leap?

Going from W-2 to independent work is a big decision. It comes with more flexibility, higher earning potential, and the ability to build something truly your own. But it also comes with more financial responsibility: taxes, retirement planning, and making sure you’re legally structured the right way.

The good news? You don’t have to figure it all out alone.

Thinking About Making the Switch to Consulting? Let’s Talk.

At Insogna CPA, we help entrepreneurs like you make the transition with confidence. Whether you need guidance on quarterly tax planning, choosing between an LLC or S-Corp, or optimizing your tax deductions, we’re here to help.

Book a consultation today, and let’s build a tax strategy that keeps more of your money where it belongs: in your business...