Self-employed individuals, freelancers, and independent contractors have access to a powerful set of tax deductions that W-2 employees simply can’t touch. But only if you claim them. This checklist covers every major write-off available in 2025 — organized by category so you can go line by line before you file.
2025 key figures: standard mileage rate 70¢/mile, SEP-IRA limit $70,000, Solo 401(k) limit $70,000, HSA limits $4,300 (self) / $8,550 (family), QBI phase-out starts at $197,300 single / $394,600 MFJ.
Part 1: Above-the-Line Deductions (Reduce Your AGI — No Itemizing Required)
These come off your gross income before calculating your Adjusted Gross Income (AGI). They’re available whether you itemize or take the standard deduction, and they reduce both your income tax and your self-employment tax.
- ☐ Half of self-employment tax — Deduct 50% of your SE tax. Calculated on Schedule SE, flows to Schedule 1 Line 15. Automatic — don’t skip it.
- ☐ Self-employed health insurance premiums — 100% deductible for medical, dental, and vision coverage for you, your spouse, and dependents. Cannot claim for months you were eligible for an employer plan. Full guide →
- ☐ SEP-IRA contributions — Up to 25% of net self-employment income, max $70,000 in 2025. Deductible above the line. Retirement deduction guide →
- ☐ Solo 401(k) contributions — Up to $23,500 employee + 25% employer contribution, total capped at $70,000 ($77,500 if 50+). Must establish by December 31.
- ☐ HSA contributions — $4,300 (self-only) / $8,550 (family) fully deductible if you have a qualifying high-deductible health plan.
- ☐ Qualified Business Income (QBI) deduction — Up to 20% of net business income for most freelancers earning under $197,300 (single). No separate form required for simple returns.
Part 2: Business Operating Expenses (Schedule C)
These reduce your net profit on Schedule C — lowering both income tax and the 15.3% self-employment tax. Document every expense with receipts or bank records.
Office & Workspace
- ☐ Home office deduction — Simplified method: $5/sq ft (up to 300 sq ft = $1,500 max). Actual method: percentage of rent/mortgage, utilities, and insurance. Must be regular and exclusive business use. Full guide →
- ☐ Coworking space or external office rent — 100% deductible if solely for business
- ☐ Office supplies — Paper, ink, postage, pens, folders
- ☐ Office furniture & equipment — Desks, chairs, monitors. Can deduct via Section 179 (full deduction in year of purchase) or depreciate over time.
Technology & Software
- ☐ Software subscriptions — Adobe Creative Cloud, Notion, Slack, Zoom, QuickBooks, Canva Pro, Grammarly, etc. Full guide →
- ☐ Cell phone (business-use %)) — Deduct the percentage used for work. Track your usage pattern. Guide →
- ☐ Home internet (business-use %) — Deduct the business-use percentage. Guide →
- ☐ Computer, tablet, and hardware — Business-use percentage. Full deduction via Section 179 in year of purchase or depreciate over 5 years.
Vehicle & Transportation
- ☐ Business mileage — 70¢/mile in 2025 for all business-purpose driving. Track with an app (MileIQ, Everlance). Log must include date, destination, and business purpose. Mileage vs. actual guide →
- ☐ Parking and tolls — Always deductible on top of the mileage rate
- ☐ Business travel — Flights, hotels, car rentals for trips that are primarily for business. 100% deductible. Guide →
- ☐ Business meals — 50% of meals with clients or while traveling for business. Must document the business purpose and who attended. Guide →
Professional & Marketing
- ☐ Advertising & marketing — Google Ads, Meta Ads, social media, website hosting, domain registration
- ☐ Professional fees — CPA, attorney, bookkeeper, business consultant fees paid for business purposes
- ☐ Education & training — Courses, books, certifications, and conferences that maintain or improve skills for your current work. Guide →
- ☐ Business gifts — Up to $25 per recipient per year. Keep recipient name and business purpose documentation.
- ☐ Professional memberships — Industry associations, trade groups, professional societies
Insurance & Financial
- ☐ Business insurance premiums — General liability, E&O (errors & omissions), professional indemnity
- ☐ Bank fees — Monthly business account fees, wire transfer fees, check fees
- ☐ Payment processing fees — Stripe, PayPal, Square transaction fees (2.9% + 30¢ per transaction adds up fast)
- ☐ Business credit card interest — Interest on cards used exclusively for business
Often-Missed Deductions
- ☐ Business startup costs — If you started your business this year, up to $5,000 in startup expenses can be deducted immediately (remainder amortized over 180 months)
- ☐ Bad debts — If you reported income from a client who never paid, you may be able to deduct the uncollected amount as a bad debt
- ☐ Section 179 and bonus depreciation — Allows full or partial first-year deduction of qualifying business equipment rather than spreading it over years
- ☐ Business-related magazines and publications — Industry trades, research databases
Part 3: Medical Deductions (If You Itemize)
Medical expenses exceeding 7.5% of your AGI are deductible on Schedule A if you itemize. This covers doctor visits, prescriptions, dental, vision, therapy, and more. Note: self-employed health insurance premiums are better claimed on Schedule 1 (above-the-line), not Schedule A.
Complete medical deduction guide → | Free calculator →
How to Use This Checklist Effectively
Go through each category before meeting with your accountant or filling out Schedule C. For each item you check:
- Gather receipts, bank statements, or credit card records
- Note the business purpose (IRS requires this for expenses over $75)
- For mileage: pull your mileage log total
- For home office: measure the square footage of your dedicated workspace
- For phone/internet: determine your business-use percentage
Use our AI Deduction Finder to discover write-offs specific to your situation, or our home office calculator and mileage calculator to estimate your biggest deductions instantly.
The QBI Deduction: Don’t Leave 20% on the Table
The Qualified Business Income (QBI) deduction under Section 199A is one of the most valuable self-employment tax breaks — and one of the most commonly missed. If you have qualified business income from a sole proprietorship, partnership, S-corp, or single-member LLC, you may deduct up to 20% of that income from your taxable income.
For 2025, the full deduction applies for income below $197,300 (single) or $394,600 (MFJ). Above those thresholds, stricter rules apply — especially for “specified service trades or businesses” (SSTBs) like law, health, consulting, and finance.
On $80,000 of net business income: 20% QBI deduction = $16,000 off your taxable income before any other deductions. At the 22% bracket, that’s $3,520 in tax savings — from a single line on your return.
Retirement Accounts: The Biggest Tax Lever Available
Retirement contributions are the single largest deduction most self-employed people can take. The 2025 options:
- SEP-IRA: Up to 25% of net self-employment income (after SE tax deduction), max $70,000. Simple to set up, deadline is April 15 (or extension).
- Solo 401(k): Up to $23,500 employee + 25% employer contribution, total capped at $70,000. Add $7,500 catch-up if age 50+. Must establish by December 31 of the tax year.
- SIMPLE IRA: Up to $16,500 employee + 2% employer match or 3% non-elective contribution.
- Traditional IRA: Up to $7,000 ($8,000 if 50+), with deductibility phased out at higher incomes if you have a workplace plan.
Contributing $20,000 to a SEP-IRA at the 22% bracket saves $4,400 in federal income tax — plus reduces your SE tax base. This is legal, IRS-encouraged tax reduction at its most straightforward.
Frequently Asked Questions
Do I need to be incorporated to claim self-employed deductions?
No. Sole proprietors filing Schedule C have access to every deduction on this list. An LLC, S-corp, or partnership may have different forms but doesn’t create new deductions. Most freelancers are sole proprietors and claim everything on Schedule C of Form 1040.
Can I deduct expenses from a part-time freelance side gig?
Yes — if you have any self-employment income, you file Schedule C, and all legitimate business expenses against that income are deductible. If your expenses exceed your income, the resulting loss may offset your W-2 income (though the IRS may scrutinize persistent losses as a “hobby” after several years).
What’s the difference between above-the-line and Schedule C deductions?
Schedule C deductions reduce your net business profit — which in turn reduces both income tax and self-employment tax. Above-the-line deductions (SE tax deduction, health insurance, retirement) come off your AGI after Schedule C profit is calculated. Both are valuable, but Schedule C deductions reduce your SE tax base as well, making them worth slightly more per dollar for self-employed filers in high SE-tax situations.
Should I use tax software or a CPA?
For simple freelance situations (one Schedule C, no employees, no inventory), self-filing with TurboTax Self-Employed, TaxAct, or FreeTaxUSA is very workable. For more complex situations — multiple income streams, S-corp consideration, significant assets, high income — a CPA typically saves more in taxes than the fee costs. At minimum, use this checklist before your first CPA meeting to make sure you don’t miss anything.
Bottom Line
Self-employed filers have more deductions available than almost anyone — but only those who track expenses all year and know what to look for actually claim them all. Start with the biggest opportunities: QBI deduction, retirement contributions, home office, vehicle mileage, and health insurance premiums. Then work through the full checklist above to make sure nothing is left on the table.
Also see: Updated 2025 self-employed deductions checklist · Home office deduction guide · Mileage deduction calculator · Self-employed health insurance deduction
This checklist is for educational purposes only. Tax laws change — consult a licensed CPA or tax professional for personalized guidance. Figures reflect 2025 IRS rules per IRS Publications 535 and 560 and Rev. Proc. 2024-40.