Like everyone else, as a small business owner you want to pay your taxes. Also like everyone else, you don’t want to pay more than you absolutely have to. And, while you’re probably familiar enough with tax credits for families or homeowners, chances are you may not know exactly what does and doesn’t qualify as a tax credit for your small business.

To make things even more complicated, there are specific credits for specific industries, and there are all sorts of deductions for business expenses that can get confusing as well. The more you understand what counts as a credit or a deduction, the less you’ll have to pay.

Here are a few small business tax credits you need to know about:

• 5-year carryback. Your general business credit can generally be carried back just a single year in order to offset the previous year’s taxes. Depending on your business, you may be able to carry back those credits for up to five years. Talk to your tax expert about whether this applies to you, and how to take advantage of it.
• Health care tax credit. The new health care law gives a number of different credits to businesses. For example, you can get up to a 35 percent credit for the cost of premiums that you pay for your employees through 2013. That increases up to 50 percent in 2014.Individuals who are self-employed can deduct (not get a credit for) 100 percent of their insurance costs. The amount of the credit varies based on the size of your business; for example, businesses that have 10 or less employees that all make an average of $25,000 or less get the biggest credit, while those companies who have more than 25 employees or who pay average wages more than $50,000 see the credit phase out.
• Worker hiring credit. The HIRE Act in 2010 offered incentives for getting people back into the work force. You get a payroll tax credit for hiring an employee, and then a credit of as much as $1,000 if you keep the worker for 60 days.
• Employer pension startup cost credit. This is a smaller credit that you can get for forming a new employer pension plan. It’s a credit for a maximum of $500 each year for up to three tax years.

These are the small business tax credits that your small business is most likely to get. There are a number of other business tax credits, however, that you might qualify for, depending on your industry and other factors related to your business. For example, here are some of the more obscure tax credits you might not know are out there:

• Biodiesel and Renewable Diesel Fuels Credit
• Empowerment Zxone and Renewal Community Employment Credit
• Mine Rescue Team Training Credit
• Credit for Increasing Research Activities
• Disabled Access Credit

Small business deductions

The other half of the tax situation for small businesses has to do with deductions. While there are many deductions that you can take for your small business, there are some you might not know about, such as:

• Cell Phone deductions. You can now deduct the cost of a cell phone just like any other property. This is an improvement, as previously there were a number of unnecessary requirements to be able to do so.
• The home office deduction. Chances are you’ve heard about the home office deduction, but you’re not sure whether you’re able to claim it. Ultimately, it comes down to whether you regularly use your home for conducting business, and whether you have a specific area of your home that’s primarily used for running your business.
• Retirement plans. Even if you don’t qualify for the tax credit for starting up a new employee retirement plan, you can still deduct monies that you put aside for your, and your employees’, retirement.
• Business related education. If you attend seminars, take a class, or even purchase a book related to your business, it’s an expense that can be deducted.
• Insurance. In addition to the potential for a health insurance credit, you can generally deduct the premiums that you pay for your business’ insurance, including things like professional liability insurance or property insurance.

As you can see, your business taxes are probably at least a little bit more complex than your personal taxes. When it comes time to do your taxes, make sure you work with a qualified tax expert. Find someone who understands all of the rules about what counts as a credit or a deduction, and put their expertise to work for you.

Dominique Molina is President of the CertifiedTaxCoach.org, a professional organization that helps tax professionals deliver thousands in tax savings to their clients. Dominique has compiled many resources for members including a tax-specific engagement letter, the most comprehensive tax course in the industry, and powerful accounting marketing guides.