Running a small business comes with a lot of responsibilities — and tax compliance is one of the biggest. Unfortunately, many business owners make common tax mistakes that can cost them thousands or trigger IRS audits.

Here are 7 tax pitfalls to watch for:

Mixing Personal and Business Expenses
Use a separate business bank account and credit card. Mixing funds makes bookkeeping messy and can raise red flags with the IRS.

Failing to Track Deductions Properly
Don’t leave money on the table. Mileage, office supplies, home office space, software, and more — they’re all potential write-offs if properly tracked.

Not Making Quarterly Estimated Payments
If you expect to owe more than $1,000 in taxes, the IRS requires estimated payments. Missing these can result in interest and penalties.

Misclassifying Workers
Independent contractor or employee? Get it wrong, and you may be on the hook for back taxes and penalties.

Ignoring State and Local Tax Rules
Every state (and sometimes county) has its own tax laws. Work with a local CPA who knows your area.

Filing Late
Even if you can’t pay right away, file your return on time. Late filing penalties can be more severe than late payment fees.

Not Hiring a Tax Professional
Tax software can’t replace a qualified CPA. Professional advice often results in greater savings and peace of mind.

Need help avoiding these mistakes? Contact Mare & A CPA, LLC today.