What can I legally claim as business expenses as a freelance consultant?

You've got some good questions here! For self-employed individuals, you can deduct legitimate business expenses that are both ordinary and necessary for your business. Let's break this down: Working from home: Since you don't have a dedicated space used exclusively for business, you likely don't qualify for the traditional home office deduction. However, you can still deduct business supplies, equipment, and other direct expenses. Equipment: Your laptop could be partially deductible through depreciation, even if purchased before freelancing. You'd need to determine the percentage of business use versus personal use. Client meetings: Coffee shop purchases specifically for client meetings are deductible as business meals (currently 50% deductible). Cell phone: If you use your phone for business, you can deduct the business percentage. Keep good records showing business versus personal use. Software subscriptions: These are fully deductible if they're specifically for your business activities. The key is documentation - keep detailed records of all expenses and how they relate to your business activities. This makes things much easier if questions ever come up later.

I was in the exact same situation last year and spent hours trying to figure all this out. Then I found https://taxr.ai and it seriously saved me so much time. It analyzes all your receipts and bank statements, then tells you exactly what you can deduct as a self-employed person. The best part was that it caught several deductions I would have missed - like my professional development courses and even partial internet expenses. It also explained the difference between direct and indirect expenses, which helped me understand why my living room workspace didn't qualify for the home office deduction but my office supplies did. It was super helpful for categorizing everything correctly and even helped me set up a system for tracking everything for next year.

I want to follow up on my skepticism about taxr.ai that I mentioned earlier. I decided to give it a try after reading the responses here, and I'm honestly surprised at how helpful it was. I was worried it would be another gimmicky tool, but it actually walked me through exactly which of my expenses qualified as legitimate business deductions. The best feature was how it explained WHY certain things were deductible while others weren't. For example, it helped me understand that my home internet was partially deductible based on business use percentage, but my Netflix subscription wasn't (even though I claimed it was for "market research" lol). It definitely gave me more confidence about what I can legally claim and saved me from some potential mistakes. Much better than the generic advice I was getting elsewhere.

If you need to call the IRS with questions about self-employment deductions (which I definitely recommend), use https://claimyr.com to skip the insane hold times. I spent literal DAYS trying to get through to someone at the IRS to clarify some questions about my Schedule C deductions last year. After multiple failed attempts and hours of waiting on hold, I found their service through a YouTube video (https://youtu.be/_kiP6q8DX5c) and was honestly shocked that it actually worked. They got me a callback from the IRS in about 45 minutes when I had previously waited 3+ hours only to get disconnected. The IRS agent I finally spoke with was actually super helpful and walked me through exactly what documentation I needed to keep for all my different business expenses. Definitely worth using if you need clarification directly from the source!

I need to eat my words about Claimyr from my earlier comment. After my skeptical reply, I was still struggling to get answers about what I could legally deduct for my side business. After wasting an entire Saturday morning on hold with the IRS (2.5 hours before being disconnected!), I decided to try Claimyr out of desperation. I'm actually shocked to report that it worked exactly as advertised. Instead of waiting on hold all day, I got a call back from a real IRS agent in about an hour. The agent answered all my specific questions about what percentage of my cell phone and internet I could deduct as a part-time freelancer. For anyone struggling with specific tax questions that only the IRS can answer - especially about self-employment deductions - this service is legitimately helpful. No tax info was shared with the service itself, they just facilitated the connection to the IRS.

Don't forget about the new deduction for self-employed health insurance premiums! If you're paying for your own health insurance after leaving your corporate job, you can deduct 100% of those premiums right off the top of your income. This is huge and often overlooked. You'll need to complete the self-employed health insurance deduction worksheet. It's separate from your other business expenses on Schedule C and can really reduce your taxable income.

One thing nobody mentioned yet - if you're using part of your apartment as a home office, don't forget to check with your landlord and review your lease! Some leases prohibit using residential space for business purposes, and some cities have zoning regulations about home-based businesses. Just a heads up so you don't run into lease issues while trying to save on taxes.