What Freelancers Can Deduct on Schedule C: A Plain-English List

By Plainfield Media · Updated October 28, 2026

Schedule C is where a sole proprietor or single-member LLC owner reports business income and expenses. Every legitimate expense you list lowers your profit, which lowers both income tax and self-employment tax. Below is a plain-English walk through the expense lines freelancers use most, with the line numbers from the current form.

Not tax advice. This article is general information based on IRS publications. Your situation may differ. Check the current IRS guidance or talk with a tax professional before you file or pay.

The basic test: ordinary and necessary

The IRS says a business expense must be both ordinary (common and accepted in your line of work) and necessary (helpful and appropriate for your business). It does not have to be required to count. Personal costs don't qualify. When something is used for both, such as a phone or a car, you deduct only the business share. IRS Publication 334 covers the rules for small businesses in detail.

The common Schedule C expense lines

Line	What it covers	Freelancer examples
8	Advertising	Ads, a portfolio site, business cards
9	Car and truck expenses	Driving to clients, supply runs (see mileage below)
10	Commissions and fees	Marketplace and platform fees taken from your pay
11	Contract labor	Paying other freelancers who are not your employees
13	Depreciation and section 179	A laptop, camera or other equipment that lasts more than a year
15	Insurance (other than health)	Professional liability, business property coverage
16b	Interest (other)	Interest on a business credit card or loan
17	Legal and professional services	Accountant, tax prep for the business part, lawyer
18	Office expense	Postage, printer ink, small office items
20a / 20b	Rent or lease	Equipment rental (20a), a coworking desk or studio (20b)
21	Repairs and maintenance	Fixing business equipment
22	Supplies	Materials you use up while doing the work
23	Taxes and licenses	Business licenses, the employer share of payroll tax if you have staff
24a	Travel	Airfare, lodging and transport for business trips away from home
24b	Deductible meals	Business meals, generally at 50%
25	Utilities	Utilities for a separate business space
26	Wages	Pay to employees (not to yourself)
27b	Other expenses	Software, subscriptions, bank and payment fees, work-related courses, listed in Part V
30	Business use of your home	Home office (see below)

Line 27a is a specialized deduction for energy-efficient commercial buildings, not general expenses. Most freelancers will put their miscellaneous costs in Part V, which carries to line 27b.

A few lines that need extra care

Car and truck (line 9)

You can usually choose between the standard mileage rate and your actual costs (gas, insurance, repairs, depreciation) times your business-use percentage. For 2026 the IRS business rate is 72.5 cents per mile for January through June and 76 cents per mile from July 1 through December 31. The 2027 rate had not been announced when this was written. Driving from home to a regular workplace is commuting, and commuting is not deductible. Keep a mileage log with dates, places, purpose and miles.

Home office (line 30)

To qualify, part of your home must be used regularly and exclusively for business, and it generally needs to be your principal place of business. A desk in the corner of a guest room you also use for guests doesn't pass the exclusive-use test. The simplified method allows $5 per square foot, up to 300 square feet, for a maximum of $1,500. The regular method uses Form 8829 and your actual home costs. IRS Publication 587 covers both.

Meals (line 24b)

Business meals are generally 50% deductible when the meal isn't lavish, you or an employee are there, and it's with a client, customer or business contact. Entertainment, such as event tickets, is not deductible. Publication 463 has the rules.

Equipment (line 13)

A new laptop is not an ordinary supply purchase. You can depreciate it over several years or, in many cases, deduct it in the first year under section 179 or bonus depreciation, which you figure on Form 4562. Many small businesses also use the de minimis safe harbor election to expense lower-cost items. Check Publication 946 or ask a tax pro before choosing.

Gifts

Business gifts are capped at $25 per person per year. Gifts go in Part V with your other expenses.

Startup costs

If you spent money before the business started, such as research or initial marketing, you may be able to deduct up to $5,000 in the first year, with the rest spread over time. The $5,000 shrinks once total startup costs pass $50,000.

Deductions that go somewhere else

These are real tax breaks for freelancers, but they don't go on Schedule C. They go on Schedule 1 of Form 1040 as adjustments to income:

Half of your self-employment tax
Self-employed health insurance premiums, if you qualify
Contributions to a SEP, SIMPLE or solo 401(k) for yourself

Because they skip Schedule C, they lower income tax but not self-employment tax.

What you can't deduct

Personal living expenses, even if you work from home
Commuting to a regular work location
Clothing that is suitable for everyday wear, even if you only wear it for work
Fines and penalties paid to a government
Entertainment
Your own "salary" as a sole proprietor (your profit is your pay)

Keep records as you go

The IRS expects you to back up deductions with receipts, invoices, bank and card statements, and logs like mileage. Publication 583 explains what to keep. Sorting expenses into Schedule C categories as you spend is much easier than rebuilding a year of statements in March.

Track it in one spreadsheet

The 2027 Freelancer Tax & Profit Tracker has expense categories mapped to these Schedule C lines and a summary tab that totals each line for you or your tax preparer.

See the 2027 Tax & Profit Tracker