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Is tax preparation fees deductible tax deductible?

TL;DR

Tax preparation fees are not deductible for individuals, but they may be deductible for businesses.

Detailed Answer

For individual taxpayers, tax preparation fees are not deductible due to the suspension of miscellaneous itemized deductions subject to the 2% floor under the Tax Cuts and Jobs Act (TCJA) from 2018 through 2025. However, businesses, including self-employed individuals, can deduct tax preparation fees as a business expense if the fees are related to their business tax return.

Where to Put It on the Tax Form

For businesses, report on Schedule C (Form 1040) for sole proprietors or on the appropriate business tax return form.

Real World Example

A freelance graphic designer can deduct the portion of tax preparation fees related to their Schedule C, but not the portion related to their personal tax return.

Calculation Required

A calculation is required for this deduction.

Allocate the tax preparation fees between personal and business-related services. Only the business portion is deductible.

Audit Risk & Documentation Tips

Keep detailed invoices from your tax preparer showing the breakdown of services provided. Maintain records of how you allocated the fees between personal and business use to substantiate the deduction.

IRS Reference

IRS Publication 529, IRS Publication 334

Relevant Industries

Small BusinessFreelancersSelf-EmployedCorporations

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Disclaimer: This is for informational purposes only and should not be construed as tax or legal advice. Always consult your tax advisor.

Page created on July 15, 2025

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