Business Expense Deduction Guide for Self-Employed (2026)
Maximize business expense deductions: qualifying expenses, documentation requirements, Schedule C reporting, and audit defense preparation.
Summary
Self-employed taxpayers can deduct legitimate business expenses to reduce taxable income. This guide explains qualifying expenses, documentation rules, and Schedule C reporting.
Key Steps
- 1Identify qualifying expenses: home office, equipment, travel, supplies, insurance.
- 2Calculate home office deduction: simplified ($5/sq ft, max 300 sq ft) or regular method.
- 3Track vehicle expenses: mileage log or actual costs (gas, repairs, insurance).
- 4Document all expenses: receipts, invoices, bank statements for audit defense.
- 5Report on Schedule C: categorize expenses by type, maintain separation from personal.