TallyO

If you earn money through gig work, freelancing, or any kind of self-employment, Schedule C (Profit or Loss From Business) is the IRS form that determines how much of your income is actually taxable. Every dollar you can legitimately deduct on this form reduces both your income tax and your self-employment tax.

The problem? Schedule C has 28 expense lines, and most gig workers only use two or three of them. Let’s walk through the lines that matter most — plus a comprehensive checklist of deductions you might be missing.

Before We Start: How Schedule C Works

Schedule C is straightforward at a high level. Part I is your gross income (the total you earned). Part II is your expenses (the costs of running your business). Subtract expenses from income, and you get your net profit — that’s the number that flows to your 1040 and determines your tax bill.

Every legitimate deduction you claim on Schedule C reduces your net profit, which lowers both your income tax and your 15.3% self-employment tax. A $1,000 deduction can save you $300 or more in total taxes.

Line 9: Car and Truck Expenses

For most gig workers — especially drivers — this is the single biggest deduction on your entire return. You have two options: the standard mileage rate ($0.70/mile in 2026) or the actual expenses method.

If you choose the standard mileage rate, you’ll report the total here on Line 9. If you use actual expenses, you’ll fill out Part IV of Schedule C (lines 44–47) with your vehicle details, and the deduction flows back to Line 9.

What counts as business miles:

• Driving to and from client sites or gig locations
• Miles driven while actively on a delivery or rideshare trip
• Trips to the office supply store for business supplies
• Driving to the bank to deposit business income

What doesn’t count: your regular commute from home to a fixed workplace (but if you have a home office, trips from home to clients are fully deductible).

Line 18: Office Expenses

This line covers the day-to-day supplies and costs of running your business from an office or home workspace. Think of it as the “stuff you buy to do your job” line.

Common Line 18 deductions for gig workers:

• Printer ink and paper
• Pens, notebooks, and office supplies
• Postage and shipping costs
• Software subscriptions (accounting software, design tools, project management)
• Cloud storage fees
• Computer accessories (keyboard, mouse, webcam)

Line 25: Utilities

If you have a dedicated home office, you can deduct a portion of your home utilities on Line 25. This includes electricity, gas, water, internet, and even trash collection. The amount is based on your home office percentage — typically calculated by dividing the square footage of your office space by the total square footage of your home.

Line 27a: Other Expenses

This is the catch-all line — and it’s where many gig workers leave the most money on the table. Any legitimate business expense that doesn’t fit neatly into Lines 8 through 26 goes here. You’ll itemize these on Part V of Schedule C (Line 48).

Common Line 27a deductions gig workers miss:

• Phone bill (business-use percentage of your cell phone plan)
• Platform fees charged by Uber, DoorDash, Fiverr, Upwork, etc.
• Background check fees required by gig platforms
• Safety equipment (phone mounts, dash cams, insulated delivery bags)
• Continuing education (courses, certifications, books related to your work)
• Business portion of internet (if not already claimed under home office)
• Bank fees on your business account
• Professional memberships and subscriptions

Other Important Lines

Line 10: Commissions and Fees

Payment processing fees from PayPal, Stripe, Square, or Venmo for business transactions go here.

Line 11: Contract Labor

If you pay someone to help with your business — a virtual assistant, an editor, a subcontractor — and you pay them $600 or more, report it here (and send them a 1099).

Line 13: Depreciation

Big-ticket items like computers, cameras, or equipment that will last more than a year can be depreciated over time or deducted immediately using the Section 179 deduction. For most gig workers, if you bought a laptop or tablet for your business, this is where it goes.

Line 15: Insurance

Business liability insurance, professional insurance, and commercial auto insurance premiums are deductible here. Note: health insurance goes on a different part of your 1040, not on Schedule C.

Line 17: Legal and Professional Services

Tax preparation fees (the portion related to your business), legal consultations, and bookkeeping services are reported here.

The Gig Worker Deduction Checklist

Here’s a comprehensive list of deductions gig workers commonly qualify for. Use this as a reference when preparing your Schedule C.

How Deductions Reduce Your Tax Bill

Let’s put this in real numbers. Say you earned $45,000 in gig income and you’re wondering whether it’s worth the effort to track all these deductions.

Without deductions, you’d pay self-employment tax on the full $45,000 — roughly $6,360 in SE tax alone, plus income tax. But if you claim $12,000 in legitimate deductions (mileage, phone, supplies, home office), your net profit drops to $33,000. That’s $1,695 less in SE tax and potentially another $1,200–$2,640 less in income tax, depending on your bracket.

Tracking your deductions could easily save you $3,000–$4,300 per year. That’s real money.

The Bottom Line

Schedule C doesn’t have to be scary. For gig workers, the key lines are 9 (car), 18 (office), 25 (utilities), and 27a (everything else). Get those four lines right, and you’ve captured the vast majority of your deductions. The rest is just filling in the gaps.

The most important habit? Track everything from day one. A deduction you can’t prove is a deduction you can’t claim.