The good news is, they're handled outside of the itemized deductions. That's a flat rate and won't change because of deductions. The bad news is that those deductions won't bring down your self-employment tax. With all that said, There are four special deductions for independent contractors that don't fit on Schedule C OR in Itemized deductions. Tax deductions are applied later, so they don't bring down those taxes. That difference is important, because expenses on Schedule C will lower your Self-Employment tax. Tax deductions are different than business expenses. Here's the other thing to think about in all of this.
ARE CONTRACTOR EXPENSES TAXABLE SERIES
The Delivery Driver's Tax Information Series Disclaimer Unfortunately, that means if you take the standard deduction, there are a lot of things you can't claim. That standard deduction is so high now that it's more unusual than ever to itemize. For most deductions, you have to choose whether to claim the Standard Deduction or whether it's better to itemize them. All of that gets handled in the income part of the income tax process.Īnd then there are your tax deductions. Most of what we talk about in this guide has to do with that income and those expenses. You use a Schedule C where you enter all of your income, and then you enter all of your expenses, deduct expenses from income, and that's how you come up with your actual business income.
If you've read through this tax guide, by now you've come to figure out that most of your deductions for self employed work aren't really deductions.
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