Schedule C Line Lookup: Where Every Expense Goes

Pick the expense. The table gives you the line, and each entry opens a page with the test that decides it, what it gets confused with, and the record that proves it. Lines 8 to 27 are Schedule C Part II; a handful of common costs are not Part II expenses at all, and those are collected at the end.

Every expense, A to Z

Schedule C Part II, line by line

Line 8: Advertising

• a domain name registration
• a Squarespace or Webflow subscription
• an email marketing tool such as Mailchimp
• business cards and printed flyers
• Facebook and Instagram ad spend
• Google Ads spend
• logo and brand design
• SEO tools such as Ahrefs or Semrush
• sponsorship and influencer fees
• website hosting

Line 9: Car and truck expenses

• a car used for business and personal trips
• a registration bill that is part property tax
• business mileage
• car insurance
• car repairs and maintenance
• gas and fuel
• parking fees
• rideshare and delivery driver mileage
• tolls
• vehicle registration and plate fees

Line 10: Commissions and fees

• a real estate commission split
• Amazon seller fees
• App Store and Google Play commission
• Etsy fees
• pay-per-lead fees from Thumbtack, Angi or Yelp
• PayPal fees
• referral fees you pay
• sales commissions you pay
• Shopify transaction fees
• Square fees
• Stripe processing fees
• Upwork and Fiverr platform fees

Line 11: Contract labor

• a freelance developer or designer
• a freelance editor or bookkeeper
• a freelance photographer
• a staffing agency invoice
• a subcontractor on a client project
• a virtual assistant
• a website bug fix by a contractor

Line 12: Depletion

• a mineral or oil and gas interest
• gravel or sand extraction
• timber cut from land you own

Line 13: Depreciation and section 179 expense deduction

• a business sign
• a camera and lenses
• a desk and office chair
• a laptop or computer
• a laptop used 70 percent for work
• a phone handset
• a trailer
• capital expenditures
• commercial kitchen equipment
• software bought outright
• tools over a few hundred dollars

Line 14: Employee benefit programs

• an employee educational assistance program
• an employee wellness or gym benefit
• dependent care assistance for employees
• employee health insurance premiums
• group term life insurance for employees
• HSA contributions for employees

Line 15: Insurance (other than health)

• a business owner's policy
• a surety or performance bond premium
• business interruption insurance
• commercial property insurance
• cyber liability insurance
• general liability insurance
• professional liability insurance
• workers' compensation insurance

Line 16a: Interest, mortgage (paid to banks, etc.)

• mortgage interest on a building you use in the business

Line 16b: Interest, other

• a merchant cash advance finance charge
• business credit card interest
• business loan interest
• car loan interest
• interest on a personal loan used in the business

Line 17: Legal and professional services

• a registered agent's annual fee
• a tax prep fee covering the 1040 and Schedule C
• an appraiser's fee
• bookkeeper and accountant fees
• business consultant fees
• fractional CFO fees
• legal fees for drafting a client contract
• legal fees to sue a customer
• tax preparation fees

Line 18: Office expense

• a desk lamp
• a mixed order of supplies and groceries
• a paper shredder
• a password manager subscription
• a PO box rental
• a software subscription
• a virtual mailbox
• a work app subscription
• accounting software
• cloud storage
• office coffee
• office stationery
• postage
• printer ink
• printer paper
• project management software

Line 19: Pension and profit-sharing plans

• a 401(k) employer contribution for an employee
• a retirement plan administration fee
• a SEP-IRA contribution for an employee
• a SIMPLE IRA employer match for an employee

Line 20a: Rent or lease of vehicles, machinery and equipment

• a leased copier or printer
• a leased trailer
• a leased vehicle
• a rented dedicated server
• car lease payments
• equipment and tool rental

Line 20b: Rent or lease of other business property

• a coworking membership
• a storage unit rental
• event or venue hire
• office rent
• studio or workshop rent
• warehouse rent

Line 21: Repairs and maintenance

• a camera sensor clean
• a laptop screen or battery replacement
• an annual machinery service contract
• an HVAC repair in a building you own
• painting a rented studio
• pest control
• repairing a broken tool
• routine cleaning of business premises
• servicing business equipment

Line 22: Supplies

• a dog groomer's shampoo
• branded uniforms and workwear
• cleaning chemicals and cloths
• clinic and lab disposables
• materials a tradesperson consumes on a job
• memory cards for a camera
• packaging and shipping boxes
• PPE, work gloves and safety boots
• salon color and product used on clients
• small tools under the de minimis threshold

Line 23: Taxes and licenses

• a city or county business license
• a state franchise tax or LLC annual fee
• a state professional license renewal
• employer payroll taxes and the employer half of FICA
• federal and state unemployment tax
• personal property tax on business equipment
• real estate property tax on a business building
• sales tax you collected and remitted

Line 24a: Travel

• a flight to a client site
• a hotel on a business trip
• a per-diem claim for lodging
• a rental car on a business trip
• a trip that mixed business and holiday
• airport parking
• an Airbnb for a work trip
• baggage fees
• international business travel
• laundry and dry cleaning while traveling
• train and Amtrak fares
• Uber and Lyft rides on a business trip

Line 24b: Deductible meals

• a coffee meeting
• a meal at a conference
• a staff holiday party
• a team meal for employees
• lunch with a client
• your own meals while traveling overnight

Line 25: Utilities

• a dedicated second business landline
• a hotspot or mobile data plan
• a mixed-use phone bill
• a mobile phone bill
• a security monitoring service
• a shared internet connection
• a VoIP service
• electricity for a rented office or studio
• gas and heating for business premises
• internet service
• utilities in a part-shop part-home building
• water, sewer and trash for business premises

Line 26: Wages

• an employee bonus
• an employee's gross wages
• payments to your spouse
• vacation and sick pay
• wages paid to your own child

Line 27a: Other expenses (itemised in Part V)

• a background check
• a branded gift for a client
• a business coach
• a conference registration fee
• a hot-desk day pass
• a payroll service
• a professional certification renewal
• a stock photo license
• a telephone answering service
• a trade show booth fee
• a translation service
• an online course
• bank fees
• chamber of commerce dues
• credit card annual and late fees
• LLC formation legal fees
• professional and union dues
• startup costs
• the business gift limit
• trade journals and business books
• trademark registration legal fees

Not a Schedule C Part II line

These are the ones that cost people money. The expense is real and often deductible, but it is claimed somewhere other than a Part II line, and putting it on Schedule C either overstates the deduction or loses it.

Line 30, business use of your home

• a home's electricity bill with a home office
• home costs for a home office
• home mortgage interest where you have a home office
• homeowner's or renter's insurance with a home office
• renting a room in your own home to your business
• the simplified home office method
• working from home

Part III line 36, purchases less personal use

• inventory bought to resell

Part III line 37, cost of labor

• wages paid to workers who make the product

Part III line 38, materials and supplies

• a baker's ingredients
• printing consumables for a print on demand seller
• raw materials

Part III line 39, other costs

• freight-in on inventory

Schedule 1 line 15, deductible part of self-employment tax

• self-employment tax

Schedule 1 line 16, self-employed retirement plans

• the owner's own SEP-IRA or solo 401(k) contribution

Schedule 1 line 17, self-employed health insurance

• your own health insurance premiums

Schedule A, personal itemised deduction

• a charitable donation
• state income tax on business income

Schedule E, rental real estate

• rental property expenses

Form 4562, carried to Schedule C line 13

• a new roof on a business building
• a used machine bought second hand
• a website build
• a work van or truck
• buying a business vehicle
• expensing or capitalising a purchase
• improvements to a rented studio
• legal fees to buy property or defend title
• sales tax paid on a capital asset
• workshop machinery such as a 3D printer

Not deductible

• a business suit
• a government fine or penalty
• a parking ticket
• a personal expense on the business card
• a spouse's airfare on your business trip
• a traffic ticket
• an unpaid invoice
• commuting mileage
• country club dues
• estimated tax payments
• federal income tax
• groceries for your home
• interest on underpaid federal income tax
• life insurance on yourself
• paying yourself or taking an owner's draw
• political contributions
• sports tickets with a client
• the first landline into a residence
• the principal part of a car payment
• training for a new career
• work clothes
• your own disability income insurance
• your own lunch at your desk

For the whole form walked in order with what qualifies under each heading, read Schedule C expense categories. If some of the receipts behind these numbers are missing, claiming expenses without receipts covers what the rules actually allow.

Sources

• IRS Instructions for Schedule C (Form 1040)
• IRS, About Schedule C (Form 1040)
• IRS Publication 334, Tax Guide for Small Business

This page explains how Schedule C lines work. It is general information, not tax advice for your situation. If an expense is large or the answer turns on a fact about your business, confirm it with your tax preparer.