Nondeductible expenses do not directly impact taxable income. However, it does reduce the amount of total profit that is reportable on your taxes.
For example, if you spend $500 on a non-deductible expense, the business’s taxable income will be reduced by $500 even though it cannot be deducted from your taxes.
As such, having an understanding of what qualifies as non-deductible expenses can help you make wiser financial decisions and manage your tax liability in a more effective manner.