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This guide covers U.S. federal income taxes for the 2025 tax year—expenses paid or incurred in 2025 and reported on a return filed in 2026. Whether you can deduct a work expense depends first on your work status: most employees cannot deduct unreimbursed job costs, while self-employed people may generally deduct eligible business expenses.
Which work expenses can you deduct?
| Your status | Federal tax treatment |
|---|---|
| Most W-2 employees | Generally cannot deduct unreimbursed job expenses as miscellaneous itemized deductions. Form 2106 is limited to specified employee groups. |
| Self-employed person or sole proprietor | May generally deduct eligible, ordinary and necessary business expenses on Schedule C, subject to business-use rules and expense-specific limits. |
| Statutory employee | If the statutory-employee box on Form W-2 is checked, business income and expenses are generally reported under Schedule C rules. |
The IRS defines an ordinary expense as “common and accepted in your trade or business” and a necessary expense as “helpful and appropriate for your business” (Publication 463, 2025). A purchase is not deductible simply because you use it while working: it must meet the applicable rules, have a business purpose where required, and be supported by records.
When an employee may use Form 2106
Form 2106 is available only to specified employee categories, including Armed Forces reservists, qualified performing artists, fee-basis state or local government officials, and employees with impairment-related work expenses. The rules and allowable deduction depend on the category and the facts. Ordinary employee costs such as supplies, uniforms, commuting, remote-work expenses, or employee-paid vehicle costs are not generally deductible on a federal return.
What can self-employed people deduct?
Sole proprietors generally report business income and expenses on Schedule C. Potential deductions include supplies and other operating costs, qualifying business travel, the business share of vehicle costs, and eligible business-use-of-home expenses. Claim only the portion connected to the business; personal use is not a business deduction.
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- Supplies and operating costs: Costs that are ordinary and necessary for the business may qualify. Keep evidence of what you bought and how it relates to the work.
- Business travel and transportation: Eligible travel costs can include transportation, lodging, local transportation, laundry, business calls, and qualifying meals when travel meets IRS rules.
- Vehicle use: You may be able to deduct business mileage or the business share of actual vehicle costs, depending on the method used and your eligibility.
- Home office: A qualifying workspace may allow a deduction calculated using the simplified or actual-expense method.
Gig income is reportable even if you did not receive Form 1099. A gig worker treated as an employee follows employee rules; an independent contractor generally reports business income and eligible expenses and may need to make estimated tax payments.
Travel, meals, and commuting
Business travel
Travel expenses may qualify when you travel away from your tax home for business under IRS rules. Potentially eligible costs include transportation to a business destination, local transport between an airport or hotel and the business location, lodging, laundry, business calls, and similar ordinary and necessary expenses. A temporary assignment expected to last more than one year is generally treated as indefinite. Most employees cannot deduct unreimbursed travel costs; limited exceptions apply.
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Business meals
Unreimbursed non-entertainment business meals are generally subject to a 50% deduction limit. The taxpayer or employee generally must be present, and the meal must not be lavish or extravagant under the circumstances. Keep records showing the business purpose and the relevant details of the expense.
Commuting
Travel between home and a regular work location is generally personal commuting, not deductible business travel. Travel between qualifying work locations can be treated differently. For example, travel from a qualifying home office that is the principal place of business to another work location may count as business transportation.
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Can you write off mileage for work?
For tax year 2025, the IRS standard mileage rate for business use is 70 cents per business mile. This rate applies to 2025 business mileage, not automatically to another tax year. Keep a record of the date, destination, business purpose, and miles for each trip.
If eligible, you may use the standard mileage method or actual vehicle expenses. The standard mileage method generally means you cannot also deduct actual operating costs for the same vehicle and year; business parking and tolls may be separately deductible. If the vehicle is used personally as well as for business, allocate costs and mileage to business use rather than claiming the entire amount.
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Can you deduct a home office?
A home-office deduction generally requires regular and exclusive use of a specific part of your home for a qualifying business purpose, such as serving as your principal place of business or meeting clients or customers there. Exceptions can apply in some inventory-storage and daycare situations. Employee home-office expenses cannot be claimed on an employee’s personal return using Form 8829.
| Method | How it works | Where it is reported |
|---|---|---|
| Simplified | $5 per square foot, up to 300 square feet, for eligible taxpayers. | May be claimed directly on Schedule C; not available for rental use of the home. |
| Actual expenses | Calculate allowable home expenses under the applicable business-use rules. | Form 8829 is generally used to determine the deduction for Schedule C. |
These are alternative calculation methods. Do not claim both methods for the same home-office space for the same period.
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Separate deductions introduced for 2025
The 2025 Schedule C instructions identify deductions that are not ordinary Schedule C business expenses. Their eligibility, definitions, phaseouts, and reporting are governed by the Schedule 1-A instructions. Having tips, overtime pay, or a vehicle loan does not by itself establish eligibility.
- Qualified tips: A deduction of up to $25,000 may be available for qualified tips under the 2025 instructions.
- Qualified overtime compensation: A deduction of up to $12,500, or $25,000 for joint filers, may be available under the 2025 instructions.
- Passenger-vehicle loan interest: Some self-employed vehicle users may deduct the personal-use portion of qualified passenger-vehicle loan interest on Schedule 1-A. Self-employed taxpayers must avoid deducting the same interest both as a business expense and on Schedule 1-A.
Reimbursements and records to keep
Do not claim an expense twice—once through an employer reimbursement and again as a deduction. Check how a reimbursement was handled and whether it covered the cost before claiming anything. If an employer was required to reimburse an expense and you did not seek that reimbursement, you generally cannot deduct the amount covered by it.
For vehicle and travel expenses, retain records that support the time, place, business purpose, and amount; include the business relationship where relevant. The Form 2106 instructions generally require receipts for lodging at any amount and for other expenses of $75 or more. A paper mileage log is optional, not an IRS-required form, and a logbook by itself may not document every required detail.
Use the applicable IRS form instructions for your filing situation, including Schedule C, Form 2106, Form 8829, and Schedule 1-A. This article addresses federal income tax; state tax treatment can differ. If your worker classification, reimbursement arrangement, or expense eligibility is unclear, check the current IRS instructions or consult a tax professional.
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