15 Tax Deductions Every Freelancer Should Claim in 2026

The IRS lets you deduct business expenses that are both "ordinary and necessary": common and accepted in your field, and helpful and appropriate for your business. The hard parts are knowing which rule and limit applies to each cost and keeping the records to prove it.

This guide covers 15 deductions that apply to many US freelancers, contractors and sole proprietors filing Schedule C for the 2026 tax year, with the IRS source for each rule. It is general information, not tax advice: check your own situation with a tax professional. A short note on the UK, Canada and Australia is at the end.

The 15 deductions

1. Home office deduction

If you use part of your home regularly and exclusively for your business, you can deduct it (IRS Publication 587). There are two methods:

• Simplified method: $5 per square foot of the business area, up to 300 square feet, so the maximum is $1,500.
• Regular method: work out the business percentage of your home and deduct that share of rent or mortgage interest, utilities, insurance, repairs and depreciation. Some of these expenses are limited to the gross income from the business use of your home.

Worked example: your office is 150 sq ft in a 1,500 sq ft apartment, so 10%. The simplified method gives 150 × $5 = $750. The regular method gives 10% of $24,000 annual rent = $2,400, plus 10% of utilities and renter's insurance. Here the regular method is worth more, but it needs more records. See our home office deduction guide for the full tests.

Documentation: a floor plan or measurements of the office, rent or mortgage statements, and utility bills.

2. Deduction for half of self-employment tax

Self-employment tax is 15.3% (12.4% Social Security plus 2.9% Medicare) on 92.35% of your net earnings from self-employment (IRS Topic 554). You can deduct one-half of it as an adjustment to income on Schedule 1 (Form 1040), not on Schedule C (Publication 334). It lowers your income tax, not the self-employment tax itself. Our self-employment tax guide walks through the calculation.

3. Self-employed health insurance

You may be able to deduct premiums for medical, dental, vision and qualified long-term care insurance for yourself, your spouse, your dependents and a child under age 27 at year end. You cannot claim it for any month in which you were eligible to join a subsidized plan through your own or your spouse's employer, even if you didn't enrol, and the deduction cannot exceed the net profit from the business under which the plan is established (Instructions for Form 7206). It is an adjustment to income, so it reduces adjusted gross income.

4. Internet and phone

Deduct the business-use percentage of your internet and mobile phone bills. If 70% of your phone use is for business, deduct 70% of the cost.

Landlines: the basic local service charge for the first landline into your home is a nondeductible personal expense, but a second line used only for business is deductible (Publication 587).

5. Software and subscriptions

Tools you pay for to run the business are deductible, for example:

• Invoicing software (such as InvoiceQuickly Pro)
• Design tools (Figma, Adobe Creative Cloud)
• Project management (Asana, Notion, Trello)
• Accounting and bookkeeping software
• Cloud storage and email (Google Workspace, Dropbox)
• Communication tools (Slack, Zoom)

If you also use a subscription personally, deduct only the business share.

Documentation: receipts or bank and card statements showing each charge.

6. Equipment and technology

Computers, monitors, cameras and microphones you need for work can be deducted. Instead of depreciating them over several years, you can often deduct the cost in the year you place them in service:

• Section 179: for tax years beginning in 2026 the limit is $2,560,000. For property you also use personally, you can elect Section 179 only if business use is more than 50% in the first year, and only the business-use share of the cost counts (Publication 946).
• De minimis safe harbor: if you don't have an applicable financial statement, you can elect to deduct tangible property costing up to $2,500 per item or invoice (Publication 334).

Worked example: a $2,000 laptop used 80% for business has a business cost of $2,000 × 80% = $1,600. That $1,600 is what you can deduct, not the full $2,000.

7. Professional development

Courses, workshops, books, certifications and conferences that maintain or improve skills in your current business are deductible education expenses (Publication 334; Publication 970). Education that qualifies you for a new trade or business is not. A UX course for a web developer usually qualifies; guitar lessons don't.

8. Business travel

When you travel away from home primarily for business, you can deduct transportation, lodging, baggage fees, tips, and laundry and dry cleaning during the trip. Business meals are generally limited to 50% of the cost. If you add personal side trips to a business trip, you can deduct only the business-related travel expenses; a trip that is primarily personal is not deductible, although business expenses at the destination can be (Publication 463).

What doesn't count: lavish or extravagant costs, personal sightseeing and the costs of anyone travelling with you who has no business reason to be there.

9. Vehicle expenses

If you drive for business (client meetings, supply runs, the post office), choose one of two methods:

• Standard mileage rate for 2026: 72.5 cents per mile from 1 January to 30 June 2026 and 76 cents per mile from 1 July 2026 (IRS standard mileage rates).
• Actual expenses: fuel, insurance, repairs and depreciation, multiplied by your business-use percentage.

Worked example: 1,200 business miles from January to June and 1,000 miles from July to December give (1,200 × $0.725) + (1,000 × $0.76) = $870 + $760 = $1,630.

Documentation: a mileage log with the date, destination, business purpose and miles for each trip, recorded at or near the time (Publication 463). Commuting from home to a regular workplace is not business mileage.

10. Business insurance

Premiums for professional liability, errors and omissions, general liability and business property insurance are deductible business expenses (Publication 334). See business insurance for freelancers for the policy types.

11. Marketing and advertising

Website hosting, domain names, paid social ads, business cards, portfolio printing and email marketing tools are deductible as advertising and business expenses.

12. Professional services

Fees paid to accountants, bookkeepers, lawyers and consultants for business work are deductible. For tax preparation, you can deduct on Schedule C the cost of preparing the part of your return that relates to the business; fees for personal matters are not business expenses (Publication 334).

13. Retirement contributions

Self-employed retirement plans allow much larger deductible contributions than an IRA. 2026 limits:

Worked example: a freelancer with $100,000 net profit owes self-employment tax of $100,000 × 92.35% × 15.3% = $14,129.55, half of which ($7,064.78) is deductible. The maximum SEP contribution is 20% × ($100,000 − $7,064.78) = $18,587. If all of that income falls in the 22% bracket, the contribution lowers federal income tax by about $18,587 × 22% = $4,089. It does not reduce self-employment tax. See retirement planning for freelancers.

14. Bank fees and payment processing

Monthly business bank account fees, card processing fees, PayPal and Stripe transaction fees, wire fees and currency conversion fees are deductible business expenses (Publication 334 lists bank fees).

15. Coworking space and office supplies

Coworking memberships, office furniture, stationery, printer ink, postage and shipping supplies are deductible. Rent for a dedicated office outside your home is deductible as rent expense and is separate from the home office deduction.

Deductions at a glance

How to track deductions year-round

Most lost deductions are lost to missing records, not to not knowing the rule. By April you won't remember whether a $47 charge was a client lunch or a personal dinner.

1. Separate accounts. A dedicated business bank account and card make it much easier to show which costs are business. See business banking for freelancers.
2. Categorize weekly. Classify expenses as they happen rather than once a year. Our business expense tracking guide shows a simple routine.
3. Keep the evidence. For travel, gift and vehicle expenses, the IRS generally expects documentary evidence such as receipts; the main exception is an expense, other than lodging, of less than $75. Lodging always needs a receipt (Publication 463). Keeping receipts for everything is simpler.
4. Keep your invoices in order. Your invoices document your income. InvoiceQuickly keeps every invoice with its client, amount, dates and payment status, and on Pro you can export invoices to CSV for your accountant.
5. Pay estimated tax. You generally must make estimated payments if you expect to owe $1,000 or more for the year after withholding and credits (IRS estimated taxes). Use your expected deductions to size the payments.

Don't forget estimated tax payments

No employer withholds tax from freelance income, so you pay quarterly estimated tax. For the 2026 tax year the due dates on Form 1040-ES are 15 April 2026, 15 June 2026, 15 September 2026 and 15 January 2027. Underpaying can bring a penalty even if your deductions later cut the final bill. Our quarterly tax payments guide covers the safe-harbor rules.

Freelancers outside the US

The rules above are US federal rules. Other countries have their own:

• UK: HMRC lists allowable costs for sole traders in Expenses if you're self-employed, including simplified expenses for vehicles and working from home.
• Canada: the CRA's guide T4002, Self-employed Business, Professional, Commission, Farming, and Fishing Income explains which business expenses you can claim.
• Australia: the ATO's business deductions pages set out what sole traders can claim.

Next steps

Good invoices are the income half of your tax records. Make sure each one includes the details your clients and your accountant need: see our invoice checklist and the self-employed invoice template.

Last reviewed: 28 October 2026. This article is general information about US federal tax rules for the 2026 tax year, not tax advice. Rules and limits change each year; check the IRS pages linked above or ask a tax professional.

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