Tax-Deductible Items When Filing a 1099

by Van Thompson

A 1099 is an IRS tax form used to report income. Freelancers and independent contractors commonly receive 1099s at the end of the tax year from their clients. The business that provides you with the 1099 sends a copy of the form to the IRS, so you must report all income from a 1099 to the IRS. A 1099 does not change the deductions you can claim on your tax returns. However, people filing 1099s often have business expenses associated with their work as independent contractors. Many business-related tax deductions should be itemized on Schedule C of your tax return.

Business Supplies

Many people who receive 1099s purchase supplies that they can claim as deductions. Supplies include items used to make things you sell -- such as paint, lumber or jewelry-making supplies -- as well as office supplies such as printers, paper, computers and similar items. Supplies must be directly associated with the cost of doing business, and you can't claim supplies for which a client pays. For example, if you run a landscaping company and a client reimburses you for the cost of seeds, you can't claim seeds on your return.

Business Expenses

Business expenses are expenses related to the daily operation of your business. You can, for example, deduct the price of rent, utility bills and memberships to organizations directly related to doing business. Advertising is also a business expense that you may deduct. If you have a home office, you may deduct the utility and mortgage costs that go toward your home office. For example, if you live in 2,000-square-foot house and have a 200-square-foot space dedicated solely to your business, you may deduct one-tenth of your mortgage and utility payments.

Travel Costs

If you have to travel for work, you can deduct mileage at the standard IRS mileage rate -- 55.5 cents as of 2012. You can't deduct the cost of traveling from your home to a work site, but you can deduct the cost of traveling from one work site to another as well as long-distance travel. You may also deduct the cost of lodging, airfare and travel-related meals.

Educational Costs

If your job requires continuing education, such as conferences, classes or training sessions, you may deduct the cost of attending these sessions. You may also deduct the cost of tuition at qualifying educational institutions -- up to $4,000 in tuition and fees as of 2012.

About the Author

Van Thompson is an attorney and writer. A former martial arts instructor, he holds bachelor's degrees in music and computer science from Westchester University, and a juris doctor from Georgia State University. He is the recipient of numerous writing awards, including a 2009 CALI Legal Writing Award.

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