Freelancer Tax Deduction Real Talk

Freelancer Tax Deduction

Tax season is upon us here at Almost Millions. This year, individuals have three extra days to file taxes–because April 15 falls on a Saturday and Monday, April 17 is a holiday in the District of Columbia, Tax Day 2017 is Tuesday, April 18.

With tax season here, we did the simple thing: Talk to a bunch of smart people about taxes, freelancing, and 1099ing. That means it’s Tax Week at Almost Millions, and here’s a little bit of freelancer assistance.

Congratulations, you’re a freelancer! Apart from being able to work in your pajamas and watch unlimited Netflix on the job, there’s another benefit to freelancing: Lots of tax deductions.

We’re not accountants, and we strongly recommend you speak with accountants or tax professionals to understand how these apply to you, but here are some of the best freelancer tax deductions you might not know about:

Freelancer Tax Deduction: Home Office

There’s one very good reason to have a home office in a separate room: You can deduct the cost of the home office from your taxes.

A home office deduction lets you deduct costs from a dedicated space in your home that you use solely for work purposes.

You can deduct that space’s expenses in rent, mortgage payments, property taxes, rental or homeowner insurance, and utility bills from your taxes.

The easiest way of figuring out your cost is to figure out the size of your home office relative to the rest of your apartment or house, and then apply that to your yearly expenses–an accountant can help with that.

There’s one more important thing to remember for this deduction. In order to qualify, your home office has to be your primary place of business. If you work out of a coworking space most days, you unfortunately don’t qualify.

Freelancer Tax Deduction: Work Travel

If you travel for your freelance job, expenses such as flights, hotel rooms, vehicle mileage, parking spots, and Uber/Lyft/public transportation are tax deductible.

50% of your food costs during travel are tax deductible as well.
Workcations or trips that involve both work and fun travel aspects can be tax deductible as well. Generally speaking, the IRS requires trips to consist of at least 50% business work–check with your accountant on this one.

Freelancer Tax Deduction: Marketing And Advertising

If you run a website to promote your freelance work, the cost of that website is tax deductible. So are costs such as business cards, Facebook advertising, and tickets to trade shows where you network your business.

In addition, you can also deduct the cost of online- or in-person courses from your taxes. Online resources such as Skillshare and Lynda.com, as well as extension courses related to your work from local schools, are all tax deductible.

Freelancer Tax Deduction: Other Resources

Amazon: U.S. Master Tax Guide (2017) by CCH Tax Law Editors

Amazon: J.K. Lasser’s 1001 Deductions and Tax Breaks 2017: Your Complete Guide to Everything Deductible by Barbara Weltman

Amazon: 475 Tax Deductions for Businesses and Self-Employed Individuals: An A-to-Z Guide to Hundreds of Tax Write-Offs by Bernard B. Kamoroff C.P.A.