Freelancers and sole proprietors overpay taxes every year. Not because the law is unkind — because Schedule C has 27 line items and most filers fill in five. The IRS is fine with that. They are not in the business of finding deductions for you.
This guide lists the 25 write-offs most independent workers miss, the documentation each one needs, and the ones that actually trigger audits.
What changed in 2026
- Section 179 limit raised to $1.22M. Relevant if you bought equipment for a one-person LLC.
- Standard mileage rate is 70 cents. Up from 67 cents in 2024.
- The QBI deduction (Section 199A) is still 20% — set to expire at end of 2025 but extended through 2026 by the December tax bill.
How we picked
- Bullet 1: Listed in IRS Publication 535 or Schedule C instructions
- Bullet 2: Commonly missed per H&R Block and TurboTax usage data
- Bullet 3: Has clear documentation rules
- Bullet 4: Not audit bait
- Bullet 5: Adds up to real money for typical freelancers
1. The big four — best for most freelancers
Home office (Form 8829 or simplified $5/sq ft up to 300 sq ft), self-employment tax (50% of SE tax is deductible above the line), health insurance (100% of premiums), and retirement contributions (SEP-IRA up to 25% of net earnings, Solo 401k up to $70,000 in 2026).
Together, these four routinely save $5,000–$15,000 for a $100K freelancer.
2. The mid-tier 12 — best for everyone with receipts
Phone, internet, software subscriptions, professional development, books, conferences, business meals (50%), business travel (100%), professional services (lawyer, accountant, bookkeeper), business insurance, advertising, and office supplies.
The trade-off: each one needs a paper trail. A spreadsheet with date, vendor, amount, and business purpose is enough.
3. The overlooked 9 — best for power users
Bank fees on the business account, PayPal/Stripe processing fees, contractor payments (1099-NEC each), depreciation on equipment, the QBI deduction, mileage to client meetings, parking and tolls, business-use portion of car insurance and registration, and education that maintains or improves current skills.
The catch: some of these (depreciation, QBI) require Form 4562 or Form 8995, which most DIY filers avoid.
Comparison: deduction value for a $100K freelancer
| Deduction |
Typical amount |
Tax savings (24% bracket) |
Form |
| Home office (simplified) |
$1,500 |
$360 |
Schedule C line 30 |
| Health insurance |
$7,200 |
$1,728 |
Schedule 1 line 17 |
| SEP-IRA contribution |
$20,000 |
$4,800 |
Schedule 1 line 16 |
| QBI deduction |
$16,000 |
$3,840 |
Form 8995 |
| Mileage (5,000 mi) |
$3,500 |
$840 |
Schedule C line 9 |
Common mistakes to avoid
Mixing personal and business cards. Audit risk and a nightmare at tax time. Open a separate checking account and card. It costs nothing and saves hours.
Claiming 100% business use of a personal vehicle. Almost never true. Audit triggers. Track actual business miles or use a percentage that survives scrutiny.
Deducting commuting miles. Miles from home to a regular workplace are never deductible. Miles between client sites are.
FAQ
Do I need an LLC to take these deductions?
No. A sole proprietor filing Schedule C qualifies for everything except the C-corp-specific items. An LLC adds liability protection, not deductions.
What about the home office deduction if I rent?
Same rules. Deduct a percentage of rent, utilities, and renters insurance based on the square footage used exclusively for business.
Can I deduct clothing for work?
Only if it's a uniform or has a business logo and isn't suitable for streetwear. A blazer for client meetings doesn't count.
Where to go next
For related guides see Quarterly estimated taxes 2026, Best bookkeeping software for small business 2026, and Best business credit cards for freelancers 2026.