Lowering Taxes Paid

[philpgm]

My receipts never seem to add up to more than the standard deduction.   What are ways to lower the amount my small business pays in taxes?  

[Opus 17]

You are confusing 2 different things.  Business expenses and the standard deduction are completely separate and unrelated. 

Personal deductions (mortgage interest, state and local taxes, gifts to charity and medical expenses) are deducted on Schedule A, and you can take the standard deduction if that is more than your itemized deductions.

There is no standard deduction for business expenses.  Business expenses are subtracted from gross revenue on Schedule C to determine the net profit.  You should always list ordinary and necessary business expenses that you can prove with reliable records, no matter how small they are.  

[philpgm]

I file jointly with my wife we have 2 children.  We both work at this side/small sole proprietor business and receive other W2 income for our household.  We file everything together on one return sorted out using the Turbo Tax software.  After entering every business receipt possible for expenses, travel, milage, etc.  we still end up paying over 20% of just the small business's total income each year.  I want to know more about small business deductions so I can continue to use Turbo Tax instead of cancelling my use of the product and going to an accountant.  What resources does Turbo Tax provide to help couples with a small side business lower their tax burden?  

[Opus 17]

20% is not bad, considering that you pay almost 15% self-employment tax on the net profit, plus any income tax.  (The net profit is rolled into all your other income and deductions to calculate your income tax, and the self-employment tax is calculated separately.

I also want to discuss the form of the business.  As long as you did not create a specific structure like an LLC or S-corp, then would generally file 2 schedule Cs, one in your name and one in your spouse's name, each reporting the share of the work, expenses and profits that pertain to that spouse.  You should not have one schedule C for "our business" because then both spouses aren't getting property social security credit in case of disability or retirement.  There are other ways to report different business structures that we could talk about (such as one spouse has a business and pays their other spouse as a W-2 employee).  But reporting one schedule C for the combined activities is going to be wrong 99% of the time.

Turbotax does not offer specific tax planning services.  You can find articles and FAQs here on nearly every topic.  For example,

https://blog.turbotax.intuit.com/self-employed/tax-tips-for-the-self-employed-2297/

https://turbotax.intuit.com/tax-tips/self-employment-taxes/the-self-employment-tax/L8xXjolB4

https://blog.turbotax.intuit.com/business-taxes-2/how-to-deduct-business-expenses-what-you-can-write...

Intuit also sells Quickbooks for tracking business income and expenses, that may come with some advice.

https://quickbooks.intuit.com/learn-support/en-us/help-article/mobile-apps/upgrade-quickbooks-self-e...

The IRS has information about business expenses.

https://www.irs.gov/businesses/small-businesses-self-employed

https://www.irs.gov/forms-pubs/guide-to-business-expense-resources

There are a number of books on business expenses, one long running series is "J.K. Lasser's Small Business Taxes 2025: Your Complete Guide to a Better Bottom Line" although there are many others and I don't make any specific endorsements.