Expenses for an independent contractor? (Freelancer)?

Question

What types of expenses will I run into as a freelancer? This is an intentionally broad question. I'm not looking for any industry specifics.

I want to cover all the bases.... insurances, automotive, office, computer, what else could possibly come up ?

Thanks for any help on the subject!!!

...Mirca

Answer 1

Okay, the following is the expense section from Schedule C.  These are the deductible expense items.  The IRS puts Cost of Goods Sold in a separate section of the Schedule C, but in the case of a freelancer CGS either doesn't exist or is not significant.

8   Advertising                          

9   Car and truck expenses (see   

     page C-4)                            

11   Contract labor (see page C-4)     

12   Depletion                            

13   Depreciation and section 179   

     expense      deduction      (not   

     included in Part III) (see   

     page C-4)                              

14   Employee benefit programs              

     (other than on line 19)              

15   Insurance (other than health)        

16   Interest:                            

   a Mortgage (paid to banks, etc.)      

   b Other                                    

17   Legal and professional

     services

18 Office expense

19 Pension and profit-sharing plans

20 Rent or lease (see page C-5):

  a Vehicles, machinery, and equipment

  b Other business property

21 Repairs and maintenance

22 Supplies (not included in Part III)

23 Taxes and licenses

24 Travel, meals, and entertainment:

  a Travel

  b Deductible meals and

    entertainment (see page C-6)

25 Utilities

26 Wages (less employment credits)

27 Other expenses (from line 48 on

   page 2)

The only item I am confident will not apply to you is Depletion (in layman's terms Depletion is the depreciation of non-renewable resources such as oil and ore).

Hope this helps

Jerry-the-bookkeeper