Updated
What are the Schedule C expense categories?
Schedule C's expense categories are the lines in Part II, numbered 8 through 27b, plus line 30 for business use of your home. The table below uses the line labels from the 2026 Schedule C posted at irs.gov. The 2026 instructions weren't out when we checked, so the notes come from the 2025 instructions; confirm against the 2026 version before you file.
| Line | 2026 label | Typical examples | Notes from the instructions |
|---|---|---|---|
| 8 | Advertising | Online ads, printed flyers, sponsorships | |
| 9 | Car and truck expenses | Standard mileage or the business share of actual costs | 2026 rate: 72.5¢ to Jun 30, 76¢ from Jul 1. Complete Part IV or Form 4562 |
| 10 | Commissions and fees | Referral commissions, sales commissions | |
| 11 | Contract labor | Freelancers and subcontractors you don't treat as employees | 1099-NEC generally required at $2,000+ for services paid after Dec 31, 2025 ($600 for 2025); most corporations and card or payment-app payments are excluded |
| 12 | Depletion | Oil, gas, mineral, timber properties | Rare for service businesses |
| 13 | Depreciation and section 179 expense deduction | Computers, cameras, furniture, vehicles under actual expenses | Attach Form 4562 when required |
| 14 | Employee benefit programs (other than on line 19) | Employee health plans, group-term life, dependent care | Not your own health coverage |
| 15 | Insurance (other than health) | Liability, malpractice, business property | |
| 16a | Interest: Mortgage (paid to banks, etc.) | Mortgage on business property, with a Form 1098 | |
| 16b | Interest: Vehicle loan | Business share of a car loan | New separate line on the 2026 form |
| 16c | Interest: Other | Business loans, business share of card interest | |
| 17 | Legal and professional services | Accountant, attorney, business tax preparation | Fees must relate directly to the business |
| 18 | Office expense | Office supplies, postage | |
| 19 | Pension and profit-sharing plans | Contributions for employees to SEP, SIMPLE or other plans | Contributions for yourself go on Schedule 1 |
| 20a | Rent or lease: Vehicles, machinery, and equipment | Leased car, rented equipment | |
| 20b | Rent or lease: Other business property | Office, studio or storage rent | Not your home; see line 30 |
| 21 | Repairs and maintenance | Fixing equipment, servicing a printer | Not improvements, and not the value of your own labor |
| 22 | Supplies (not included in Part III) | Materials used up in the work, small tools | |
| 23 | Taxes and licenses | Business licenses, employer share of payroll taxes, sales taxes imposed on you as the seller | Not federal income tax or self-employment tax |
| 24a | Travel | Airfare, lodging, transportation while away overnight | Meals go on 24b |
| 24b | Deductible meals | Client meals, meals while traveling | Generally 50% of cost |
| 25 | Utilities | Business premises utilities, business phone line | First home landline's base rate is personal |
| 26 | Wages (less employment credits) | Employee pay | Never amounts paid to yourself |
| 27a | Energy efficient commercial buildings deduction | Qualifying building upgrades | Attach Form 7205 |
| 27b | Other expenses (from line 48) | Anything ordinary and necessary that isn't above | Itemize in Part V |
| 30 | Expenses for business use of your home | Home office | Form 8829 or the simplified method |
The form also says to enter home office expenses only on line 30, not spread across the other lines. More on that in the home office deduction guide, and on line 9 in the 2026 mileage deduction guide.
What's the difference between office expense and supplies on Schedule C?
Office expense (line 18) is narrow: the 2025 instructions describe it as "office supplies and postage." Supplies (line 22) is about materials and supplies you actually consume in the work during the year, and the instructions add that you can deduct "books, professional instruments, equipment, etc., if you normally use them within a year."
A practical way to think about it: printer paper, pens and stamps go on line 18; the materials a landscaper, photographer or cleaner uses up doing the job go on line 22. Items whose usefulness extends "substantially beyond a year" are generally depreciated on line 13 instead, unless an election such as the $2,500 de minimis safe harbor applies. If your business sells products, materials that become part of what you sell belong in Part III, cost of goods sold, which is why line 22 says "not included in Part III."
The IRS doesn't publish a single right answer for every borderline item. What matters most is that you and your CPA classify the same kind of expense the same way every year.
Which Schedule C line does software go on?
The 2025 Schedule C instructions list "technology and software tools" under Part V, other expenses, which totals on line 27b. They say this generally includes "tax preparation software and subscription services paid to manage your business," but not software that must be depreciated or amortized; "most computer software expenses must be capitalized and depreciated or expensed under section 179."
In practice, preparers differ: some put subscriptions on line 18, others in Part V. Either way, the expense has to be ordinary and necessary and used for the business, and a tool you also use personally only counts for its business share. Ask your CPA which line they use and keep it consistent.
What goes in Part V, other expenses?
Part V is for "all ordinary and necessary business expenses not deducted elsewhere on Schedule C," listed by type and amount. The instructions name several examples:
- technology and software tools,
- amounts deducted under the de minimis safe harbor for tangible property (up to $2,500 per item or invoice without an applicable financial statement), which go only in Part V,
- business startup costs (up to $5,000 in the first year, reduced when startup costs exceed $50,000, with the rest amortized over 180 months),
- amortization, and
- bad debts from income you already reported.
Publication 334 also lists bank fees and education among other expenses you may be able to deduct. Part V excludes business equipment and furniture, permanent improvements, personal expenses, charitable contributions, and fines or penalties paid to a government.
Which expenses don't go on Schedule C at all?
Several common self-employed deductions are claimed elsewhere:
- Self-employed health insurance: Schedule 1, via Form 7206.
- Retirement contributions for yourself: Schedule 1 (line 19 is only for employees).
- Half of self-employment tax: Schedule 1, after you figure it on Schedule SE.
- The QBI deduction: Form 8995 or 8995-A, after your Schedule C profit is known.
The self-employed tax deductions list walks through each one.
Example: mapping a photographer's expenses to Schedule C lines
Example (fictional numbers): Ari is a freelance wedding photographer filing Schedule C for 2026.
| Expense | Amount | Likely line |
|---|---|---|
| Instagram and search ads | $1,200 | 8, Advertising |
| 5,000 business miles (2,000 Jan to Jun, 3,000 Jul to Dec) | $1,450 + $2,280 = $3,730 | 9, Car and truck |
| Second shooter paid $2,500 by bank transfer (1099-NEC likely required) | $2,500 | 11, Contract labor |
| New camera body | $3,200 | 13, Depreciation and section 179 |
| Liability and equipment insurance | $680 | 15, Insurance |
| Accountant's fee for the business return | $600 | 17, Legal and professional |
| Postage and printer ink | $140 | 18, Office expense |
| Memory cards and backdrops used up this year | $410 | 22, Supplies |
| Photo editing and gallery subscriptions | $720 | Part V (27b), or 18 if that's her CPA's practice |
| Destination wedding: flights and hotel | $1,150 | 24a, Travel |
| Meals on that trip, $180 | $90 | 24b, Deductible meals (50%) |
The mileage line uses the split 2026 rate: 2,000 × $0.725 = $1,450 and 3,000 × $0.76 = $2,280. Ari's CPA makes the final call on each line, including whether the camera is expensed or depreciated. For meals, see the business meals deduction guide; for what to bring to that appointment, see the small business tax prep checklist.
Where Amy fits
The hard part of Schedule C isn't the lines; it's knowing which of your charges belong on them. Amy sorts the bank statements you already have into likely business expenses and shows where each one came from. Your CPA sees the source behind every line and makes the call.
