Greg Monaco, CPA finds missed deductions on virtually every return from new NJ clients. The five most commonly overlooked deductions for NJ small business owners are the BAIT election (which can generate thousands in federal savings for pass-through owners above the SALT cap), retirement plan contributions, the home office deduction, vehicle expenses, and self-employed health insurance premiums.
Every year, I find missed deductions when reviewing returns from new clients. Here are the five most common.
1. NJ BAIT Election
The single most frequently missed opportunity. Pass-through owners who itemize and are over the SALT cap can generate thousands in federal savings.
2. Retirement Plan Contributions
Many self-employed owners don’t maximize or even establish a retirement plan. A SEP-IRA allows up to 25% of net income.
3. Home Office Deduction
The simplified method gives $1,500 with minimal recordkeeping. The regular method can yield more.
4. Vehicle Expenses
70 cents per mile for 2025. A simple mileage tracking app running in the background solves the documentation problem.
5. Health Insurance Premiums
Self-employed individuals can deduct premiums for themselves and families as an above-the-line deduction.
The Lesson
Tax preparation isn’t just data entry. It’s an analysis of your situation to identify every legitimate deduction.
Key Takeaway
Tax preparation is not data entry. It is an analysis of your specific situation to identify every legitimate deduction. A CPA who asks questions about your business operations, reviews your prior returns, and proactively suggests strategies will consistently save more than the fee costs.
Related reading: NJ BAIT Election | Retirement Plans for NJ Business Owners | Health Insurance Deductions | Tax preparation services
