📌 Key Takeaway: Beyond the obvious business expenses, self-employed filers can deduct half their SE tax, health insurance premiums, retirement contributions, and a home office — deductions that don't require itemizing since they apply directly against business income.
Top Deductions for the Self-Employed
- Half of self-employment tax — an automatic adjustment to income.
- Self-employed health insurance premiums — deductible even without itemizing, within limits.
- Retirement plan contributions — SEP-IRA, Solo 401(k), or SIMPLE IRA contributions reduce taxable income.
- Home office — a portion of rent/mortgage, utilities, and insurance if you have a dedicated workspace.
- Business mileage — either standard mileage rate or actual vehicle expenses.
- Software, equipment, and supplies used directly for business.
Documentation Matters
Keep receipts and a mileage log throughout the year rather than reconstructing them at tax time — the IRS expects contemporaneous records for most business expense deductions, especially vehicle use.
Common Mistakes
Deducting 100% of a mixed-use expense (a phone or vehicle used for both business and personal) instead of the business-use percentage is one of the most common self-employed filing errors.
This page is for educational purposes and isn't personalized financial or tax advice. Figures, rates, and program details change frequently — confirm current terms directly with lenders, tax professionals, or the IRS before acting.