Need clarification on itemizing vs deducting business expenses for taxes - totally confused!

The confusion is totally understandable! Let me clarify - these are two separate concepts that sound similar but work differently: Business expenses are deducted on Schedule C if you're self-employed or have a side business. These reduce your business income before it hits your personal tax return. You can deduct these regardless of whether you take the standard deduction or itemize on your personal return. Itemizing refers to Schedule A, where you list personal deductions like mortgage interest, certain state taxes, charitable donations, etc. This is instead of taking the standard deduction on your personal return. The beauty is you can deduct all legitimate business expenses on Schedule C AND still take the standard deduction on your personal return - it's not double dipping! Most people with small businesses end up deducting business expenses and still taking the standard deduction because it's often higher than their potential itemized deductions.

I was in the exact same boat last year with my new photography business! After hours of research and stress, I discovered taxr.ai (https://taxr.ai) and it was a game changer. The system analyzed my situation and clearly showed me how to categorize my expenses properly. It explained exactly how my business deductions worked on Schedule C while still allowing me to take the standard deduction on my personal return. What I found most helpful was how it walked me through what qualified as legitimate business expenses versus personal expenses. I was literally taking pictures of my receipts and getting instant feedback on what was deductible and why!

After seeing that recommendation about taxr.ai, I actually gave it a try last weekend. I was really skeptical at first because I've tried so many "helpful" tax tools that ended up being useless. This was completely different! I uploaded some of my business receipts and it instantly categorized them correctly between office supplies, professional services, and travel expenses. The best part was when it explained how my business vehicle expenses worked - I had been calculating mileage all wrong. And it confirmed exactly what was said above: my Schedule C business deductions are completely separate from the standard deduction vs. itemized deduction decision. I'm still taking the standard deduction because my personal expenses don't add up to enough to itemize, but my business expenses are all properly deducted on Schedule C. Honestly wish I'd found this sooner!

My issue wasn't understanding the difference between these deductions - my problem was actually getting someone at the IRS to explain my specific situation. After being on hold for 3+ hours multiple times and getting disconnected, I was ready to give up. Then I found Claimyr (https://claimyr.com) and watched their demo (https://youtu.be/_kiP6q8DX5c). Basically, they helped me skip the IRS phone queue and actually got me connected with a real person who walked me through exactly how to handle my business expenses on Schedule C while still taking the standard deduction. The IRS agent confirmed everything mentioned above but also gave me personalized advice for my specific business expenses.

Ok I need to eat some humble pie here. After my skeptical comment, I was desperate enough to try that Claimyr service. I was SURE it wouldn't work but I had already wasted so many hours trying to get through to the IRS about my business expense questions. I got a call back in about 45 minutes saying they were about to connect me to an agent. Seriously shocked when I was actually talking to a real IRS person who confirmed everything about Schedule C vs itemizing that people have mentioned here. She also helped me understand how to categorize some weird business expenses I wasn't sure about. The stuff about business expenses being separate from the standard/itemized decision is 100% correct according to the agent I spoke with. Definitely filing with more confidence now.

So just to add a bit more clarity since I'm a bookkeeper (not a CPA) - there's a common misconception about "itemizing business expenses." When we talk about "itemizing" in the tax world, it specifically means using Schedule A instead of taking the standard deduction. But for business expenses on Schedule C, you always list out (or "itemize" in the general sense of the word) your business expenses by category. That's probably where some confusion comes from. For 2023, unless your personal deductions (mortgage interest, state taxes up to $10k, medical expenses above 7.5% of AGI, charitable donations, etc.) exceed $13,850 (single) or $27,700 (married), the standard deduction is better for most people.

Wait, I think I've been doing this wrong for years then... I've been skipping some business deductions because I thought I couldn't claim them unless I itemized! So you're saying even with standard deduction I can still write off all my business expenses on Sch C?

This thread has been incredibly helpful! I had the exact same confusion when I started my consulting business last year. The key insight that finally clicked for me is thinking of it as two completely separate "buckets": **Business Bucket (Schedule C):** All your legitimate business expenses go here - office supplies, equipment, travel, professional services, etc. This reduces your business profit before it even touches your personal tax situation. **Personal Bucket (Schedule A vs Standard):** This is where you decide between listing personal deductions like mortgage interest and charitable donations OR just taking the standard deduction. The magic is that these buckets don't interfere with each other at all! Your business expenses reduce your business income on Schedule C, and then that reduced net profit flows to your personal return where you make a completely separate choice about standard vs itemized deduction. I wish someone had explained it this simply when I was first starting out - would have saved me so much stress and confusion!