Form 1099 Schedule C Business Expenses
In this day and age, every penny counts, and the tax returns of independent contractors are a testament to this. Contractors can lose out on thousands of dollars each year simply for not tracking business expenses. These expenses (that you’re incurring anyway) can be written off each year so you can keep more of your money for yourself instead of losing it to taxes. Schedule C, which is used to report income or loss from a business with the IRS, can be filed with your 1099 forms.
So what sort of expenses are we talking about? We’ve compiled a list of each type of business expense you’ll find on the Schedule C, as well as some examples of what that type of expense includes or doesn’t include.
|
Type
|
Line
|
Acceptable Expenses
|
Unacceptable Expenses
|
|
Advertising
|
8
|
Flyers, signs, ads, branded promo items, events, trade shows
|
Office holiday parties, gifts that aren’t branded
|
|
Business Insurance
|
15
|
Fire, theft, flood, property, malpractice, general liability, workers comp
|
Health insurance, auto insurance, disability insurance
|
|
Car Expenses
|
9
|
Gas, insurance, registration, repairs, maintenance, bus fare
|
Expenses if you use Standard Mileage Rate
|
|
Depreciation and Section 179
|
13
|
Computers, office equipment, tools, furniture, cars
|
Car depreciation if using Standard Mileage Rate
|
|
Home Office Deduction
|
30
|
Business portion of rent, utilities, repairs, insurance, mortgage interest
|
Expenses if you use the Simplified Method
|
|
Meals/ Entertainment
|
24b
|
Meals or entertainment that you had with a client
|
Meals for yourself, dues for athletic clubs
|
|
Office Expenses
|
18
|
Cleaning services for office, general office maintenance
|
Home office costs, rent, utilities
|
|
Supplies
|
22
|
Any supplies you use and replace
|
Office decorations and some other office expenses
|
|
Travel
|
24a
|
Lodging, airfare or rental cars, local transportation
|
Personal costs, meals
|
|
Other Expenses
|
27a
|
Education to improve skills, banking fees, association dues
|
Expenses with their own separate categories
|
|
Type
|
Line
|
Acceptable Expenses
|
Unacceptable Expenses
|
|
Commission and Fees
|
10
|
Commissions/fees paid to generate revenue
|
City license fees, commissions paid to employees
|
|
Contract Labor
|
11
|
Any payments made to independent contractors
|
Wages paid to employees, lawyer/professional fees
|
|
Depletion
|
12
|
The use of natural resources if your business mines them
|
Gas for driving, home/office utilities
|
|
Employee Benefit Programs
|
14
|
Health or life insurance, educational assistance, accident or liability insurance
|
Your own health/retirement benefits
|
|
Employee Wages
|
26
|
Salaries, commissions, bonuses
|
Employee benefits, payments to yourself
|
|
Interest (mortgage)
|
16a
|
Interest paid on a mortgage for property used for business
|
Interest on primary home
|
|
Interest (car, other)
|
16b
|
Credit cards, business lines of credit, car payment interest
|
Interest on personal loans, home office mortgage interest
|
|
Legal/Professional Services
|
17
|
Fees paid to attorneys, tax preparers, accountants, etc.
|
Services provided by your employees
|
|
Pension Plans
|
19
|
401(k), Keogh plans, profit sharing plans
|
Contributions made to your own plan
|
|
Rent or Lease (vehicles, equipment)
|
20a
|
Machines, equipment, vehicles
|
Car lease payments if you use Standard Mileage Rate
|
|
Rent or Lease (other business property)
|
20b
|
Office or land rent, including any government taxes
|
Rent for home office, rent for trade show booths
|
|
Repairs and Maintenance
|
21
|
Repainting office, fixing or replacing equipment
|
Car related repairs, significant improvements
|
|
Taxes/Licenses
|
23
|
Business taxes, state/local licenses, required business licenses
|
Self-employment tax or income tax
|
|
Utilities
|
25
|
Office electric, gas, garbage, water
|
Utilities for your house
|
For more information on your 1099 filings, or if you have any questions, you can contact ExpressTaxFilings’s headquarters in Rock Hill, SC at (704) 839-2270 Monday through Friday from 9 a.m. to 6 p.m., EST. You can also email at support@expresstaxfilings.com or live chat with us at www.expresstaxfilings.com.
