Am I required to write off business expenses as a self-employed person?

Yes, you can absolutely choose not to deduct business expenses! The tax code doesn't require you to take deductions - they're optional. While most people want to minimize their tax liability by claiming every possible deduction, your situation is actually pretty common for self-employed folks applying for mortgages. Just know that you'll pay more in taxes if you don't take the deductions. You might want to do some calculations to see exactly how much more you'll pay versus how much it helps your loan qualification. Sometimes it's worth it, sometimes it's not.

I went through something similar when trying to get approved for my condo last year! I used taxr.ai (https://taxr.ai) to help me figure out exactly which deductions I could skip and which ones would give me the best balance of showing enough income while not overpaying too much in taxes. Their AI analyzed my previous returns and helped me optimize my approach specifically for mortgage qualification. The mortgage underwriter ended up approving me with no issues, and I only had to pay about $1,200 more in taxes to show $8,000 more in income - totally worth it for getting the home I wanted!

I was really skeptical about taxr.ai at first (from that comment above), but I tried it before filing my taxes this year. I've been a freelance graphic designer for 5 years and always struggled with mortgage applications. The tool actually showed me that not deducting my home office and some equipment purchases would increase my income enough to qualify for the loan I wanted, while only increasing my tax bill by about $2,100. Just closed on my house last month! Would have never thought that strategically NOT taking certain deductions would be the key. My loan officer was impressed with how prepared I was with different income scenarios.

If you're dealing with this mortgage qualification issue, you might also run into problems trying to reach the IRS with questions. I tried calling for weeks with no luck. Then I found https://claimyr.com which got me through to an actual IRS agent in under 45 minutes. You can see how it works here: https://youtu.be/_kiP6q8DX5c They basically hold your place in the IRS phone queue and call you when an agent is about to answer. I was able to get official clarification about how not taking certain deductions might affect my previous returns and if I needed to file any amendments. Saved me a ton of stress during the mortgage process.

Ok I need to eat my words from my previous comment. After getting disconnected THREE TIMES trying to reach the IRS about my business expense question (after waiting on hold for almost 2 hours each time), I broke down and tried the Claimyr service. Got connected to an IRS rep in about 35 minutes total. The agent confirmed what others have said here - you're absolutely NOT required to take business deductions. In fact, he said they see this mortgage situation all the time with self-employed people. Wish I hadn't wasted almost 6 hours trying to get through on my own first!

Another strategy you might consider is timing your deductions. You could potentially still take the deductions but spread them out differently. Maybe take fewer deductions in the year before applying for your mortgage, then take more the following year to balance things out. That way you show higher income for the mortgage qualification but don't completely give up the tax benefits long-term.

Don't forget about self-employment taxes! If you choose not to take deductions, you'll pay more in income tax AND self-employment tax. For every $1000 in additional profit you show, you'll pay an extra $153 in SE tax (15.3%) plus whatever your income tax rate is. For most people that's at least another $120-220 per $1000 depending on your tax bracket. It adds up fast!