The Schedule C Deduction List: Every Expense Line, in Plain English
Most self-employed people claim three or four deductions and assume they have covered it. Schedule C has more than twenty expense lines, and the ones people skip are rarely trivial — bank fees, insurance, professional services, and supplies routinely add up to thousands. Walking the full list once, deliberately, is the highest-value hour of tax admin there is, because every dollar found here cuts income tax and self-employment tax at the same time.
The test every deduction has to pass
An expense is deductible if it is ordinary — common in your line of work — and necessary — helpful and appropriate for the business. That is a genuinely generous standard, and it is not the same as 'exclusively business.' Mixed-use costs like a phone or a car are deductible at the business-use percentage, which is why an honest estimate beats both an aggressive 100% claim and skipping the deduction altogether.
Part II, line by line
This is the section that produces your total expenses on line 28.
Line 8 — Advertising
Ads, sponsored posts, business cards, website hosting, domain names, and design work for marketing.
Line 9 — Car and truck expenses
Business mileage at $0.70 per mile for 2026, or the actual cost method. Parking and tolls are deductible on top of the standard rate.
Line 10 — Commissions and fees
Platform fees, referral commissions, payment processing charges from Stripe, PayPal, or Square.
Line 11 — Contract labor
Payments to subcontractors and freelancers you hired. File a 1099-NEC for anyone you paid $600 or more.
Line 13 — Depreciation and Section 179
Equipment lasting more than a year — cameras, computers, trailers, tools. Section 179 or bonus depreciation often lets you expense it all in year one.
Line 15 — Insurance (other than health)
Business liability, professional indemnity, commercial auto, and equipment coverage. Health premiums go elsewhere, on Schedule 1.
Line 16 — Interest
Interest on business loans and on the business-use share of a credit card carried for business purchases.
Line 17 — Legal and professional services
Your accountant, bookkeeper, tax preparation attributable to the business, contract lawyers, and consultants.
Line 18 — Office expense
Printer paper, postage, small office consumables, and cloud software billed as office costs.
Line 20 — Rent or lease
Equipment rental, vehicle leases at business-use percentage, coworking desks, and studio or storage space.
Line 21 — Repairs and maintenance
Keeping equipment working. Note that vehicle repairs are already inside the standard mileage rate — do not claim both.
Line 22 — Supplies
Consumables specific to the work: shipping materials, hot bags, cleaning products, art materials, ingredients.
Line 23 — Taxes and licenses
Business licenses, permits, state registration fees, and employer payroll taxes. Not your federal income tax.
Line 24a — Travel
Overnight business travel: flights, lodging, rental cars, baggage. The primary purpose of the trip must be business.
Line 24b — Meals
Generally 50% deductible with a clear business purpose. Solo meals while working are not deductible.
Line 25 — Utilities
Utilities for a dedicated business location, and the business share of a phone line used for the work.
Line 27a — Other expenses
The catch-all: software subscriptions, professional education, industry dues, bank fees, merchant apps, and business-specific tools.
Line 30: the home office
The simplified method gives $5 per square foot up to 300 square feet, capped at $1,500, with no receipts to keep. The actual expense method on Form 8829 prorates rent or mortgage interest, utilities, insurance, and repairs by the business-use percentage of your home, and usually produces a larger deduction for renters in expensive cities. The space must be used regularly and exclusively for business — a corner of a room qualifies, a kitchen table does not.
Where health insurance and retirement actually go
These are the two biggest deductions that are not on Schedule C at all. Self-employed health insurance premiums and SEP-IRA or Solo 401(k) contributions are adjustments on Schedule 1. They reduce income tax but not self-employment tax, because SE tax is calculated on Schedule C profit before either one is applied. Putting them in Part II by mistake understates your SE tax and creates a correction later.
Line 31 and what happens next
Gross income minus total expenses gives net profit or loss on line 31. That number flows two ways at once: to Schedule 1 for income tax and to Schedule SE for self-employment tax. This dual path is why deductions are worth more to the self-employed than to employees — one dollar of expense saves your income tax rate plus roughly 14.1%.
The records that make it all stand up
You need the amount, the date, and the business purpose. A dedicated business bank account and card does 80% of this automatically. Add a mileage log with date, purpose, and miles — contemporaneous, not reconstructed in April — and keep everything for three years from filing, or six if you ever understated income significantly. Nothing on this list is risky when it is documented; the same deductions are only a problem when they are invented.
Work the list
Run the Schedule C deduction list calculator with your own categories filled in, and compare the result to what you claimed last year. The gap is almost always larger than people expect.
Frequently asked questions
+What deductions can I take on Schedule C?
Advertising, car and truck, commissions and fees, contract labor, depreciation, insurance, interest, legal and professional services, office expense, rent, repairs, supplies, taxes and licenses, travel, meals at 50%, utilities, home office, and other ordinary business expenses.
+Where does mileage go on Schedule C?
Line 9, car and truck expenses, at $0.70 per business mile for 2026, plus parking and tolls separately.
+Can I deduct my phone on Schedule C?
Yes, at the business-use percentage, usually reported under utilities or other expenses. Keep a reasonable basis for the percentage you claim.
+Is health insurance a Schedule C deduction?
No. Self-employed health insurance is an adjustment on Schedule 1, so it lowers income tax but not self-employment tax.
+What is line 31 on Schedule C?
Net profit or loss, which flows to Schedule 1 for income tax and to Schedule SE for self-employment tax.
+How long should I keep expense records?
Three years from the filing date in most cases, and six years if income was substantially understated.
About the author
Javed Niamat · Founder & Editor, GigTax
Javed Niamat founded GigTax to make self-employment tax math understandable for rideshare drivers, delivery couriers, creators and freelancers. He builds and maintains every calculator on this site and writes the guides that explain the numbers behind them.
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