Tax deductions for contractors and handymen
The tools are the obvious one. Here is what else a contractor or handyman can deduct, what most miss, and what each puts back at your tax rate.
Free. No bank login. Snap a receipt and see what it puts back.
What contractors and handymen miss
Not the laptop or the phone; everyone finds those. These are particular to the work, and each is shown the way Reimburse would log it.
Safety gear
Steel-toe boots, hard hats, eye and ear protection are the clothing that counts. Jeans and work shirts don’t.
Licenses and bonding
The license is taxes and licenses; the bond premium is insurance. Both are the cost of being allowed to do the work.
Dump and disposal fees
Hauling away what you tore out, including a dumpster rental for a job.
Tools
Under $2,500 an item, all in the year you buy them with the de minimis safe harbor.
Helpers
Contract labor, in full. A 1099-NEC once you pay someone $2,000 in a year.
Supply runs
The drive to the lumberyard or the store for a job is business mileage, logged with the job it was for.
Where a contractor’s receipts go
Each goes on its own line of Schedule C. Start from this page and Reimburse reads your receipts as a contractor’s, so the line is right the first time.
| On the receipt | Where it goes |
|---|---|
| Lumber, tile and fixtures for a client’s job | Cost of goods sold, figured in Part III and carried to line 4. |
| A tool under $2,500 | Supplies, line 22, if you elect the de minimis safe harbor. |
| A trailer or a large saw over $2,500 | Depreciation, line 13, usually all this year with Section 179 or bonus depreciation. |
| A dump or dumpster fee | Other expenses, line 27a. |
| Liability insurance or a bond | Insurance, line 15. |
| A license renewal or permit | Taxes and licenses, line 23. |
What to write on it
- Which job? Materials and dump fees tie to the client they were for.
- Who helped, and how much this year? You’ll need their W-9, and a 1099-NEC once they pass $2,000.
- For a client, or your own house? Anything for your own home comes out.
- Where from, where to? A mileage record needs the date, the miles and the business reason.
A contractor’s year
An example, not an average: a handyman and remodeler clearing $68,000 on repairs and small renovations, working out of a pickup. Materials that go into clients’ jobs are counted separately, as cost of goods sold. Every amount is priced at your rate; change it below and the year moves.
| What | Schedule C | Deductible | Back |
|---|---|---|---|
| 14,000 miles to jobs and supply runs | Line 9 | $10,395 | $3,748 back |
| Helpers on demo and big jobs | Line 11 | $8,500 | $3,065 back |
| A utility trailer, over $2,500 | Line 13 | $4,200 | $1,515 back |
| Tools, each under $2,500 | Line 22 | $3,800 | $1,370 back |
| Liability insurance and a bond | Line 15 | $2,800 | $1,010 back |
| Dump and disposal fees | Line 27a | $1,800 | $649 back |
| Truck loan interest, 80% business | Line 16b | $1,100 | $397 back |
| Blades, bits and consumables | Line 22 | $950 | $343 back |
| Phone, 80% business | Line 25 | $768 | $277 back |
| Contractor license renewal | Line 23 | $450 | $162 back |
| Steel-toe boots, glasses and a hard hat | Line 27a | $420 | $151 back |
| Estimating and invoicing software | Line 27a | $420 | $151 back |
| Parking and tolls at jobs | Line 9 | $300 | $108 back |
| The year | $35,903 | $12,947 back |
Sounds deductible, isn’t
Or has a catch.
- Materials for your own house
- Personal, even if bought on the business account.
- Jeans and work shirts
- Clothes you could wear anywhere are personal, however worn out the job makes them.
- A helper you direct like an employee
- If you control how and when they work, they may be an employee, which means payroll, not a 1099.
- Deducting the truck all at once
- Section 179 needs more than half business use, and once you depreciate the truck you use actual costs, not the mileage rate.
Questions contractors and handymen ask
What can contractors write off?
Tools, helpers, truck miles or actual truck costs, dump fees, licenses, bonds, liability insurance, safety gear, software and the business share of your phone. Materials for clients’ jobs count through cost of goods sold.
Can a handyman write off tools?
Yes. Under $2,500 an item they can be expensed at once with the de minimis safe harbor; above that, Section 179 or bonus depreciation usually lets you take it all in the year you buy it.
Do I have to send 1099s to my helpers?
Send a 1099-NEC to anyone you pay $2,000 or more in 2026, and collect a W-9 before you pay. If you direct their work like an employee’s, they may be one.
Can a contractor deduct a truck?
Yes, by its business use: either the mileage rate, or actual costs with depreciation. Deducting it all at once under Section 179 needs more than half business use.
Priced at your rate
What a deduction puts back depends on your state, your profit and how you file. Change any of it and every figure on this page reprices.
I run in . I file , and this year the business should clear about , with from a job or anything else.
of every dollar you spend on the business comes back to you.
14.1¢ is self-employment tax, 8.9¢ federal income tax and 3.7¢ California.
Your answers come with you. Next is your first receipt.
What every freelancer can deduct
- Are equipment and furniture tax deductible?Yes
- Is your car tax deductible?Partly
- Can you deduct what you pay contractors?Yes
- Are work clothes tax deductible?Rarely
- Is business insurance tax deductible?Yes
- Are LLC fees and business licenses tax deductible?Yes
- Are parking and tolls tax deductible?Yes
- Is your phone bill tax deductible?Partly
Checked on September 25, 2026 against Instructions for Schedule C, Publication 946, How to Depreciate Property, Publication 463, Travel, Gift and Car Expenses and Instructions for Forms 1099-MISC and 1099-NEC. An estimate for your records, not tax advice.
Snap the next receipt.
Set up for contractors and handymen and Reimburse reads each receipt as a contractor’s, files it on its Schedule C line and shows what it puts back.