You teach kids to ace the SAT. You don't have time to ace your own Schedule C. We set up the home office, capture the platform fees, and pick the entity that actually fits your income.
Tutors leave money on the table because the deductions look small one at a time. Stacked correctly (home office + curriculum + platform fees + mileage + retirement), the savings get serious.
Tutor at home (in person or Zoom)? The room or corner used regularly and exclusively for sessions qualifies for §280A(c) home office deduction. Simplified method up to $1,500 or actual method (utility share + depreciation). We pick the higher.
IRC §280A(c)Khan Academy Premium, Magoosh, Princeton Review SAT/ACT books, AP review books, math manipulatives, whiteboards, document camera, ring light, Zoom Pro subscription, Notion or Google Workspace: all §162 ordinary and necessary for an independent tutor.
IRC §162(a)Wyzant, Varsity Tutors, Preply, Outschool, Cambly, Italki platform fees and payment processing fees are deductible. 1099-K issued by platform must reconcile to bank deposits. We catch the missing refund/cancellation offsets that get tutors over-reported.
IRC §162; §6050WDriving to a student's home counts as business mileage at 67 cents/mile in 2024 once you have left your tax home (home office) or first business stop. Coffee shop sessions count too. We help you build a contemporaneous log that survives audit.
IRC §162; Rev. Proc. 2023-3Solo tutor under $80K net: sole prop or single-member LLC keeps it simple. Above $80K to $100K: S-Corp election saves SE tax. Test-prep boutique with assistants: S-Corp + owner reasonable comp + distribution split.
IRC §1361, §1402; Rev. Rul. 59-221CE courses, tutoring methodology workshops, subject-matter refreshers are deductible §162 if maintaining skills required by your trade. A new degree that qualifies you for a new trade (going from tutor to licensed teacher) is generally NOT deductible. Lifetime Learning Credit or American Opportunity Credit may apply personally.
IRC §162; Treas. Reg. §1.162-5; §25ASolo math tutor on Wyzant and in-home, $82K net, working from a spare bedroom. We installed home office (actual method), captured 5,800 business miles, opened a SEP-IRA, and reorganized platform 1099-K to net of refunds.
$6,000 savedFederal income tax + SE tax savings on $20K of newly captured deductions plus SEP contribution. State savings on top. Quarterly estimates set to avoid the §6654 underpayment penalty.