Can I deduct tax preparer fees if I'm both a W2 employee and Uber driver with Schedule C?

So I'm trying to figure out my tax situation this year and I have a question about deductions. I work full-time at a marketing firm (W2 employee) but I've been driving for DoorDash on weekends to save up for a vacation (filing Schedule C for that income). I paid about $275 to have my taxes prepared professionally this year because I was worried about messing something up with the self-employment stuff. Can I deduct the tax preparer fee as a business expense on my Schedule C? Or is that not allowed since part of what they did was for my regular W2 job? I know business expenses for self-employment are deductible, but I'm confused about how to handle something that covers both types of income. Do I need to split the fee somehow between personal and business? Any help would be appreciated!

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18 comments

Emma Bianchi

•8M

You can definitely deduct a portion of your tax preparation fees on your Schedule C! Since you have both W2 employment and self-employment income, you'll need to allocate the tax prep fees between the two. Only the portion related to your self-employment activity (DoorDash) is deductible on Schedule C. A reasonable way to allocate would be based on the complexity or time spent by your preparer. For example, if about 40% of your tax preparation work was related to your DoorDash activities, you could deduct 40% of the $275 fee on your Schedule C. Another approach is to ask your tax preparer to break down their fee between W2 work and Schedule C work on their invoice, which makes the allocation more straightforward. Keep documentation of how you determined the allocation in case of questions later. This is a legitimate business expense for the portion related to your self-employment income!

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Emma Bianchi

•8M

Yes, this would still apply if you're using TurboTax or other tax preparation software. You can deduct the portion of the software cost that relates to your self-employment activities on Schedule C. If you purchased a version of TurboTax specifically because it handles self-employment income (like TurboTax Self-Employed versus the basic version), you could make a reasonable argument for allocating a higher percentage of that cost to your business since you needed the upgraded version specifically for your self-employment activities.

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Olivia Martinez

•8M

After struggling with the exact same situation last year (W2 job + rideshare driving), I found this amazing tool that saved me so much headache with figuring out these mixed deductions. I uploaded my tax docs to https://taxr.ai and it actually analyzed them automatically and showed me exactly what portion of my tax prep fees could be deducted for my side gig. It also found several other deductions I was missing related to my rideshare work! The tool breaks down all your expenses and tells you what percentage is business-related versus personal. For my tax prep fees, it determined I could deduct about 35% based on the complexity of my Schedule C compared to my W2 work. Totally worth checking out if you're in this mixed income situation.

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Olivia Martinez

•8M

Yes, it works with any type of side hustle or self-employment income. The system is designed to recognize different business categories and applies the appropriate tax rules for each type, including freelance creative work like graphic design. The allocation is determined through a combination of AI analysis and established tax guidelines. It looks at the complexity of each tax form in your return, the number of entries, and applies IRS-accepted allocation methods. While there is some judgment involved, the system uses consistent methodology based on tax court precedents for these allocations, which is actually more defensible than random guesswork.

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Charlie Yang

•8M

Just wanted to update after trying that taxr.ai site mentioned earlier. I was honestly blown away by how helpful it was for my exact situation! I uploaded my tax documents and it immediately identified that my tax prep fees could be partially deducted for my freelance work. It suggested I could reasonably allocate 42% of my $320 prep fee to my Schedule C business activities based on the complexity ratio. The explanation made perfect sense - my freelance work required additional schedules and forms that my W2 job didn't need. The tool even gave me documentation to support this allocation if I'm ever questioned. It also found several other deductions I was completely missing! Definitely recommend for anyone in the mixed W2/self-employment situation.

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ApolloJackson

•8M

If you're trying to get clarification directly from the IRS on deducting tax prep fees for mixed income sources, good luck even getting through to them! I spent WEEKS trying to get someone on the phone about this exact issue last year. After getting nowhere with the standard IRS number, I finally found https://claimyr.com and their video demo at https://youtu.be/_kiP6q8DX5c. They actually got me connected to an IRS agent in about 20 minutes when I'd been trying for days on my own. The agent confirmed exactly what others are saying here - you can deduct the portion of tax prep fees related to your self-employment, but not the part for your W2 job. The agent recommended keeping documentation of how I determined the split. Worth checking out if you need official confirmation or have other tax questions that require actually speaking to a human at the IRS.

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ApolloJackson

•8M

It's not magic - they use technology to handle the waiting for you. Basically, they have automated systems that navigate the IRS phone tree and wait on hold so you don't have to. When an actual IRS agent picks up, their system transfers the call to your phone. You only pay if you actually get connected to an agent. You're right that everyone accesses the same IRS phone system, but Claimyr just handles the waiting part. Think of it like having someone stand in line for you. It's particularly useful during tax season when hold times can be 2+ hours and most people can't sit by their phone that long.

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Rajiv Kumar

•8M

Alright I need to admit I was completely wrong about Claimyr. After my skeptical comment, I was still desperate to get through to the IRS about my tax prep fee allocation question, so I decided to try it anyway. To my shock, I got connected to an IRS representative in about 15 minutes when I had previously waited over an hour and still never got through. The agent confirmed I could deduct the portion of my tax prep fees related to my side business, and recommended splitting it based on the relative complexity or time spent by the preparer on each part of my return. For anyone else with tax questions that need official IRS answers, this service actually works. I'm still surprised but definitely grateful I didn't have to waste another afternoon on hold.

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Aria Washington

•8M

Yes, courses specifically focused on business taxes for your self-employment activities would generally be deductible as a business expense. A tax course that teaches you how to handle Etsy shop taxes would be considered an ordinary and necessary business expense since it directly relates to your business operations. Just make sure to keep good documentation of the course, including the syllabus or description showing it was focused on business tax topics relevant to your specific situation. Also save your receipt or proof of payment.

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