Question 1

LLC vs S-Corp: which structure saves more on self-employment taxes?

Accepted Answer

An SCorp election can save significant selfemployment taxes compared to a default LLC — but only if your business earns enough to justify it. Here's how the math works:

Default LLC (sole proprietorship for tax purposes):
All net profit flows to your personal return on Schedule C and is subject to selfemployment tax (SE tax) of 15.3% (12.4% Social Security + 2.9% Medicare) on the first $168,600 of earnings (2024), then 2.9% on amounts above that. Plus, you owe ordinary income tax on the full net

Question 2

How do I deduct vehicle expenses for business use? Standard mileage vs actual expenses

Accepted Answer

You have two methods for deducting vehicle expenses for business use: the standard mileage rate or actual expenses. You generally choose one method for each vehicle and must stick with some restrictions.

Method 1: Standard Mileage Rate (Simpler)
 2024 rate: 67 cents per mile for business use
 Multiply your total business miles by $0.67
 Example: 15,000 business miles × $0.67 = $10,050 deduction
 You can also deduct parking fees and tolls separately (on top of the mileage rate)
 You CANNOT deduc

Question 3

Can I write off 100% of business equipment I bought in 2025 right away?

Accepted Answer

Yes, for equipment acquired after January 19, 2025, the OBBBA restored 100% bonus depreciation, allowing businesses to immediately deduct the full cost of qualifying business assets in the year they are placed in service.

This is a significant reversal: bonus depreciation had been phasing down under the old law (80% in 2023, 60% in 2024, 40% in 2025 before OBBBA). The OBBBA made 100% bonus depreciation permanent.

What qualifies:
 Machinery, equipment, computers, vehicles used for business
 Fur

Question 4

My small business lost money in 2025 — can I use that loss to reduce taxes in future years?

Accepted Answer

Yes — if your business deductions exceed your income, you may have a Net Operating Loss (NOL) that can be carried forward to offset taxable income in profitable future years. This is one of the key tax safety nets for small business owners.

What counts as a business NOL:

An NOL occurs when your allowable deductions from business (and other) sources exceed your gross income for the year. For Schedule C filers, this typically means:
 Your business expenses + any other deductions (home mortgage i

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Small Business Tax Questions & Answers

LLC vs S-Corp: which structure saves more on self-employment taxes?

How do I deduct vehicle expenses for business use? Standard mileage vs actual expenses

Can I write off 100% of business equipment I bought in 2025 right away?

My small business lost money in 2025 — can I use that loss to reduce taxes in future years?