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January 7, 2020

What Can You Expense as a Freelancer?

Lili

Have you ever found yourself surrounded by fellow freelancers talking about tax deductions? Were you the one politely nodding your head while having no idea what they were saying? Then you should read this.

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If you spend your days working to build your business, you probably want to relax when you’re done. You shouldn’t have to spend more time sitting at your desk to deal with expenses and receipts and spreadsheets. That’s why Lili Banking (available on iOS and Android) lets you manage your expenses in real-time and on the go. With a simple swipe, on a bench in the park or while waiting for the barista to brew your coffee, your expense is recorded, categorized and will be included in your auto-generated report at the end of the year.

But the question remains: what can you expense? This is always the #1 question we hear from freelancers. So here’s a list of business expenses you’re likely able to deduct comes tax time. Of course, each line of work is a little different so this list is non exhaustive. For more details and information, always refer to this IRS article regarding business expenses.


Software and Hardware

  • Computer, laptop, tablet, smartphone, printer, mouse, keyboard…
  • Subscription to software (Microsoft, Adobe…),
  • Subscription to services (Google, Vimeo…),
  • Cell phone bill and data usage,


Everything and anything you use when you computer screen is on.

 

Office Expense

  • Pens and Pencils,
  • Papers,
  • Envelopes,
  • Sketch pads,
  • Staplers…


If you’re more old school, all your office supplies are still tax deductible.

 

Marketing Materials

  • Domain registration,
  • Website hosting,
  • Themes and plugins,
  • Fonts and stock visuals,
  • Flyers, posters, business cards,
  • Advertising fees,


You are what you show – all your marketing expenses are tax deductible.

 

Work from Home Expenses

  • If a part of your home is your main place of work and is used exclusively for that purpose (meaning the dining room table doesn’t count), you can deduct the percentage of that space on your rent and/or mortgage. Note that the IRS also offers a simplified option for this: $5 per square ft, capped at 300sq/ft
  • Desk, furniture and decor,
  • Portion of your utility bills (water, electricity, internet)


You run an office at home, so some of your home expenses count as work expenses.

 

Client Meeting

If you meet clients face to face at a restaurant or coffee shop, 50% of the costs of the food and drinks in front of you are tax deductible.

 

Transportation

No matter the vehicle you used to go meet that client or get to that business location, whatever you spent to get on that vehicle or make that vehicle move is a work expense. If you use your own car, track your mileage and check how much you can deduct per mile for the current year.

 

Classes and Training

Did you learn new skills to be more efficient or expand your offerings? These expenses are tax deductible.

 

Subscription and dues

  • Legal and accounting fees
  • Business bank & credit card fees
  • Agent/manager commissions
  • Magazine subscriptions,
  • Streaming Service subscription …

Whatever you spend to keep your business in good standing and stay up to date with trends specific to your industry is part of your work expenses. 

 

Health Insurance

Gotta be in good health to do business! Some of your health expenses (premiums and a portion of your out of pockets…) are tax deductible EXCEPT if you’re covered under a spouse or a relative’s plan.

 

Conferences and Festivals

If you participate in a business conference or take a seat in sessions at a film festival, these expenses (conference pass, transportation, hotels…) qualify as business expenses.

 

Business Trip

If you go meet a client more than 100 miles away from your home, the trip counts as a business trip, therefore all the expenses engaged are tax deductible: hotel nights, 50% of your meals, transportation…

 


 

Want more pro tips and advice to up your freelance game?

Download Lili’s free ultimate guide to freelancing and get ready for some knowledge – taxes, benefits, money, lifestyle… we cover it all! 🤓

 

 

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Lili

Banking Designed for Freelancers

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