What business expenses can I deduct as a self-employed individual?

You can deduct ordinary and necessary expenses like home office, vehicle mileage, supplies, insurance premiums, professional services, advertising, travel, meals (50% limit), and retirement contributions.

How does the home office deduction work?

You can use the simplified method ($5 per sq ft up to 300 sq ft) or the regular method (actual expenses based on percentage of home used for business).

What is the standard mileage rate for 2026?

The IRS business mileage rate for 2026 is projected at 70 cents per mile. This rate covers gas, maintenance, insurance, and depreciation.

Are health insurance premiums deductible for self-employed?

Yes, self-employed individuals can deduct 100% of their health, dental, and long-term care insurance premiums for themselves, their spouse, and dependents.

What are commonly missed tax deductions for freelancers?

Commonly missed deductions include: home office, business use of personal phone, internet, professional development, business meals (50%), software subscriptions, and bank fees.

Business Expense Deduction Calculator for Self-Employed (2026)

Home Office

Office Square Footage

Calculation Method

Often missed: If you work from home, you're likely eligible for this deduction.

Vehicle & Mileage

Business Miles Driven Standard rate: $0.70/mile (2026 estimated)

Actual Vehicle Expenses ($) (instead of standard mileage)

Often missed: Track all business miles — trips to clients, the bank, office supplies store, etc.

Office Supplies & Equipment

Office Supplies ($)

Equipment & Furniture (< $2,500 each) ($)

Software & Apps ($)

Phone & Internet (business %) ($)

Often missed: Zoom/Teams subscriptions, Canva Pro, Dropbox, phone bill (business %).

Insurance

Health/Dental Insurance Premiums ($)

Business Liability/Professional Insurance ($)

Often missed: Health insurance premiums are 100% deductible for self-employed individuals.

Professional Services

Legal & Accounting Fees ($)

Consulting & Freelance Help ($)

Often missed: Tax preparation software/bookkeeping services are fully deductible.

Marketing & Advertising

Advertising & Promotions ($)

Website Hosting & Domain ($)

Travel & Meals (Business)

Travel (Airfare, Hotels, etc.) ($)

Business Meals ($) (50% deductible)

Often missed: Coffee meetings with clients, conference travel, parking/tolls are all deductible.

Education & Training

Courses, Certifications, Books ($)

Often missed: Online courses, industry conferences, and professional memberships.

Other Common Expenses

Bank & Payment Processing Fees ($)

Business Licenses & Permits ($)

Rented Equipment/Office Space ($)

Other Miscellaneous Expenses ($)

Total Business Expense Deductions

Estimated reduction in your taxable self-employment income

Category	Deductible Amount
Enter your expenses to see the breakdown

Commonly Missed Deductions

Based on your entries, here are deductions you might have overlooked: Fill in the form to see suggestions.

Next Steps

Track these expenses throughout the year. Use our Quarterly Estimated Tax Calculator to see how these deductions reduce your tax bill.

Maximize Your Self-Employed Tax Deductions

As a freelancer, independent contractor, or small business owner, every legitimate business expense you track reduces your taxable income — and the tax you owe. The IRS allows you to deduct "ordinary and necessary" expenses, but many self-employed individuals miss out on hundreds or even thousands of dollars simply because they don't know what qualifies.

Home Office Deduction

If you use a portion of your home exclusively and regularly for business, you qualify for the home office deduction. The simplified method gives you $5 per square foot up to 300 square feet ($1,500 max). The regular method lets you deduct a percentage of actual expenses like rent/mortgage interest, utilities, insurance, and repairs based on the business percentage of your home.

Vehicle Expenses

You can either deduct the standard mileage rate (70 cents per mile for 2026) or actual vehicle expenses (gas, maintenance, insurance, depreciation) prorated for business use. Keep a mileage log — it's the IRS's first request in an audit.

Health Insurance Premiums

Self-employed individuals can deduct 100% of health, dental, and long-term care insurance premiums for themselves, their spouse, and dependents. This is an "above-the-line" deduction, meaning it reduces your adjusted gross income directly.

Business Meals

Generally, business meals are 50% deductible. Keep receipts and note who you met with and the business purpose. Meals while traveling for business qualify as well.

Business Expense Deduction FAQ

What qualifies as a deductible business expense?

An expense must be both "ordinary" (common in your industry) and "necessary" (helpful for your business). It doesn't have to be indispensable to be necessary.

Can I deduct my home office if I only work from home part-time?

Yes, as long as the space is used regularly and exclusively for business. You don't need to work from home full-time.

Is my cell phone bill deductible?

You can deduct the percentage of your cell phone bill used for business. If 40% of your calls/data are business-related, deduct 40%.

Can I deduct a new laptop or computer?

Yes, if used for business. You can deduct the full cost in the year of purchase under the de minimis safe harbor ($2,500 or less per item) or depreciate larger assets.

Are business travel expenses fully deductible?

Yes, ordinary and necessary travel expenses (airfare, hotels, rental cars) are 100% deductible. Meals during travel are 50% deductible.

What records do I need to keep?

Keep receipts, bank statements, credit card records, and mileage logs. The IRS generally requires you to keep records for 3 years from the date you file your return.