All expenses

For 1099 contractors & freelancers

Are tax software and tax preparation fees tax deductible?

Partly

Yes, the part of tax prep fees for your business (Schedule C) is deductible. The personal part isn’t.

Where it goes on your return

Schedule C, line 17 (Legal and professional services).

The details

Fees for preparing Schedule C, bookkeeping, and business tax advice are deductible business expenses. That includes the business share of tax software.

The share for your personal return isn’t deductible: miscellaneous itemized deductions, which used to cover it, haven’t been available since 2018.

A preparer’s invoice that separates business and personal work makes the split easy.

Records to keep

Invoices showing the business portion.

In Smart Deductions, this is suggested as Legal & Professional (Schedule C line 17). You confirm it before it counts.

Sources

General information, not tax advice. For your specific situation, check with a CPA or Enrolled Agent.