Tax deduction guide

Year-end record checklist for the self-employed

Tax year 2026 · Updated October 16, 2026

When it counts

  • Mileage log. For each business trip, the date, where you went, why, and the miles. Publication 463 treats a log kept weekly as timely. Also note your odometer on January 1 and December 31. Schedule C, Part IV (or Form 4562, Part V) asks for your business, commuting and other miles.
  • Home office facts. The square feet of the office, and that you use the space regularly and only for business. The simplified method, $5 per square foot, needs the measurements but not the bills. For the actual method, also record the square feet of your whole home and the year's rent or mortgage interest, real estate tax, insurance, utilities and repairs. You choose the method each year.
  • Receipts. Each one with its date, amount and what it was for. A bank or card statement shows you paid, so keep the invoice or sales slip too.
  • Business-use shares. For a phone, internet, laptop or software you use for both work and life, a note of the work share and how you worked it out.
  • Equipment. The price of each item and the date it was ready to use. See the year-end equipment guide.
  • Contractors. Who you paid in 2026, how much, and whether you have a Form W-9 from each. If you paid someone $2,000 or more for services, you will generally send a Form 1099-NEC.
  • Estimated tax. The date and amount of each 2026 payment, so you know whether the January 15 payment applies to you.

When it doesn't

  • A bank or card statement alone. It shows a payment, not that the cost was for the business.
  • Rounded or guessed numbers. For travel, gifts and car expenses, Publication 463 says you cannot deduct amounts you approximate or estimate.
  • A log written from memory months later. A record kept at or near the time has more value than one prepared later.
  • Commuting miles. Driving between home and a regular workplace is personal, so keep it out of the business column. See the car and mileage guide.
  • A space that is also used for something else. A home office has to be used regularly and only for business. See the home office guide.

A worked example

A freelancer reviews the year in December.

  • Mileage: the odometer read 41,200 on January 1 and 52,000 on December 31, so 10,800 total miles. The log shows 2,100 business miles from January through June and 2,100 from July through December. The other 6,600 miles are commuting and other personal driving, which go on the other two lines of Schedule C, Part IV.
  • Mileage deduction: 2,100 miles times 72.5 cents = $1,522.50, plus 2,100 miles times 76 cents = $1,596.00, for $3,118.50.
  • Home office: 150 square feet times $5 = $750.00 with the simplified method.
  • Phone: the plan cost $1,200 for the year and about 60% of use is for work, so the business share is $720.00. A note says how the 60% was worked out.

What records to keep

  • How long: keep records that support a deduction until the period of limitations for that return runs out. That is usually 3 years after you file, and a return filed early counts as filed on the due date. It is 6 years if you leave out income that is more than 25% of the gross income on your return, and there is no limit if you do not file or file a fraudulent return.
  • Equipment and other property: until the period of limitations ends for the year you sell or dispose of it. Keep what you paid, how you used it, and the depreciation or Section 179 you took.
  • Home: if you use the actual method, keep records of when and how you acquired your home, what you paid, improvements, and any depreciation you took on the office.
  • Employees: if you have any, keep employment tax records for at least 4 years after the tax is due or paid, whichever is later.
  • Electronic copies must meet the same requirements as paper. The system has to index, store, preserve, retrieve and reproduce them in readable form, so check before you throw away an original.

Common questions

What if I did not keep a mileage log this year?

Start one now. Publication 463 says a record kept at or near the time has more value than one prepared later, and you cannot deduct amounts you approximate or estimate. If your records are incomplete, you need your own statement with specific information plus other evidence, such as invoices and client records. A log kept for part of the year can support the whole year if those weeks are representative and other evidence shows the rest of the year was similar.

Do I send a Form 1099-NEC to every contractor?

No. It is for people you paid $2,000 or more for services in your business in 2026. Payments to a corporation generally do not need one, with exceptions listed in the IRS instructions. Collect a Form W-9 from each contractor as early as you can. The form is due to the contractor and the IRS by January 31, which is a Sunday in 2027, so the due date is Monday, February 1, 2027.

Do I still owe the January 15 estimated payment?

Maybe. The fourth payment for 2026 is due Friday, January 15, 2027. You can skip it if you file your 2026 return by February 1, 2027 and pay the entire balance due with it. The January 15 guide explains who usually pays and how.

Sources

Also cited by the WriteOff rules: 26 U.S.C. sections 162, 262, 274, 280A, 280F and 6041, Treas. Reg. section 1.162-1, and Revenue Procedures 2013-13 and 2019-46.