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Ouch! Some business owners may be shocked by lost tax breaks

FILE - In this March 4, 2015 file photo, a fan eats a hot dog before a spring training exhibition baseball game between the Chicago White Sox and the Los Angeles Dodgers, in Phoenix. Owners who take customers to sporting events or the theater or treat them to a round of golf will have to foot the entire bill for those activities. The new tax law has done away with the entertainment deduction for businesses. (AP Photo/John Locher, File)
FILE - In this March 4, 2015 file photo, a fan eats a hot dog before a spring training exhibition baseball game between the Chicago White Sox and the Los Angeles Dodgers, in Phoenix. Owners who take customers to sporting events or the theater or treat them to a round of golf will have to foot the entire bill for those activities. The new tax law has done away with the entertainment deduction for businesses. (AP Photo/John Locher, File) FILE - In this March 4, 2015 file photo, a fan eats a hot dog before a spring training exhibition baseball game between the Chicago White Sox and the Los Angeles Dodgers, in Phoenix. Owners who take customers to sporting events or the theater or treat them to a round of golf will have to foot the entire bill for those activities. The new tax law has done away with the entertainment deduction for businesses. (AP Photo/John Locher, File)

By Associated Press 5 min read

photo FILE- In this Nov. 23, 2013, file photo a server fills wine glasses in St. Helena, Calif. While the new tax law gave small business owners new tax breaks including a 20 percent deduction in income for many sole proprietors, partners and owners of S corporations, Congress took back deductions for entertainment expenses, employee transit benefits and what are called net operating loss carrybacks. (AP Photo/Eric Risberg, File)

As small business owners compile their income tax returns, they may have an unpleasant surprise – some popular business deductions have disappeared or been reduced under the new tax law.

While the law gave small business owners new tax breaks including a 20 percent deduction in income for many sole proprietors, partners and owners of S corporations, Congress took back deductions for entertainment expenses, employee transit benefits and what are called net operating loss carrybacks. It also put ceilings on interest deductions for some businesses. Accountants and tax attorneys suspect small business clients to especially miss the break for entertaining clients and customers.

“I think they’re going to be shocked at how much more they didn’t get as a deduction,” says Joseph Perry, a certified public accountant with Marcum in Melville, New York.

A look at the disappearing deductions:

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