Business expenses can reduce the income subject to corporate tax, but not every cost recorded in a company’s books is automatically deductible.
Understanding common corporate tax deductions—and where limitations apply—can help businesses maintain better records and prepare more accurate tax returns.
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Corporations can generally deduct qualifying business expenses allowed under the Internal Revenue Code, including expenses such as employee compensation, rent, insurance, professional fees, supplies, utilities, business travel, certain meals, interest, depreciation, and other costs related to operating the business.
However, specific limitations and documentation requirements can apply, and some expenses are partially deductible or nondeductible.
