Schedule C is the form the IRS examiner opens first when a sole proprietor lands in exam. The deductions on it are not exotic, and the audit posture on each one is the same: the IRC section that allows it, the recordkeeping requirement the statute imposes, and the contemporaneous evidence that satisfies both. This post walks through the eleven deductions every solo practitioner should ship every engagement, with the citation trail each one carries and where the scanner slots in alongside the practitioner-side review that has to close the loop.
1. Home office deduction — IRC §280A
A dedicated space used regularly and exclusively for the trade or business qualifies under §280A. The simplified method ($5/sq ft up to 300 sq ft) covers most solo practitioners; the regular method on Form 8829 wins when the space carries a mortgage or rent allocation. The audit posture: a workspace boundary, an exclusive-use photo at intake, and a square-footage measurement contemporaneous with the engagement, not reconstructed at year-end.
2. Self-employed health insurance — IRC §162(l)
100% of premiums paid for the practitioner, spouse, dependents, and any children under 27 at year-end are an above-the-line adjustment. Easily the largest missed deduction on a solo return — and unlike an itemized medical deduction, it does not require the 7.5% AGI floor. The audit posture: the carrier-issued premium statement, the Schedule 1 filing trail, and the SSA-account confirmation that the practitioner is not eligible for an employer-subsidized plan.
3. Standard vehicle mileage — IRC §274(d) + Rev. Proc. 2023-34
Mileage between client sites, bank runs, court appearances, and networking meetings are deductible at the federal standard mileage rate. §274(d) is the substantiation statute; the four elements (amount, time, place, business purpose) sit on the statute itself. The audit posture: a calendar-based app with start-stop timestamps, not an estimate from memory the week before the return ships.
4. Business meals — IRC §274(n)
The 50% limitation in §274(n) flows through to every state without modification. The audit posture: the receipt with the amount, the attendee list, the business-purpose memo, and the date and place of the meal — all on a single contemporaneous record.
5. Solo 401(k) employer contribution — IRC §401(c)(2)
The practitioner can wear two hats: employee (elective deferral up to the §402(g) limit) and employer (profit-sharing contribution up to 25% of net self-employment earnings). On a solo return netting $200k, a properly structured Solo 401(k) routinely moves $60k+ out of current-year taxable income. The audit posture: the plan document adopted before the contribution, the Form 5500-EZ if the balance crosses the threshold, and the Schedule C bottom-line-to-net-SE-earnings bridge the contribution is calculated against.
6. §199A QBI substantiation — IRC §199A + Reg. §1.199A-1 through §1.199A-6
§199A carries its own substantiation load: W-2 wages paid, UBIA of qualified property, and the SSTB determination for any trade or business above the threshold. The trap for solo practitioners: the practitioner is both the sole employee and the only owner on a Schedule C, so the W-2 wage test is the one that fails most often at this scale. The audit posture: the contemporaneous W-2 ledger and the SSTB determination memo, both in the §6001 record from intake forward.
7. SEP-IRA for any spouse with side-activity SE income — IRC §408(k)
If a spouse earns any self-employment income from a side activity — even a few hundred dollars filed on Schedule C — the practitioner can fund a SEP-IRA contribution against that income. The plan covers the spouse too, doubling the household retirement tax shelter under one filing. The audit posture: the spouse-side Schedule C, the SEP-IRA plan document, and the contribution calculation both filed.
8. Phone + internet business-use percentage
The business-use percentage of a personal cell phone + home internet is deductible under §162(a) ordinary-and-necessary. The audit posture: a single-line monthly calculation the carrier invoice supports, plus a contemporaneous note on the business-purpose allocation method.
9. Continuing professional education — IRC §162
CLE, CPE, EA-update, and CPA continuing-ed fees are §162 ordinary-and-necessary. The audit posture: the registration receipt with the date, the program description, and the per-program business-purpose memo (keeping current qualifies as ordinary-and-necessary under the practitioner trade or business).
10. Professional subscriptions + license fees — IRC §162
State board CPA/EA license renewals, professional liability insurance, professional society dues, and trade publications are §162 ordinary-and-necessary. The audit posture: the carrier invoice + the policy period + the coverage scope, all on a single contemporaneous record.
11. Bank fees + merchant processing on the practice account — IRC §162
Monthly bank fees, merchant processing fees, and any practice-account service charges are §162 ordinary-and-necessary. The audit posture: the practice-account statement at year-end, the merchant processing monthly total, and the cross-tie to the Schedule C "other expenses" line where the totals aggregate.
Where the scanner fits
The Taxerity.AI scanner surfaces the same eleven-line deduction checklist on the practitioner’s own engagement queue that an examiner reviews on a Schedule C in exam — pairing each deduction against the IRC pin-cite (§280A, §162(l), §274(n), §274(d), §162 ordinary-and-necessary, §199A QBI, §401(c)(2)) and the §6001 ledger posture the case law expects. It does not replace the practitioner-side review that has to close the audit loop — it surfaces what the examiner is going to look for, inline with the citation chain, so the Schedule C bottom line ships with the same evidence rule the rest of the return already carries.
Closing
Solo proprietors who ship Schedule C returns every engagement with the same eleven-line discipline — the IRC section, the §6001 contemporaneous record, the §274(d) four elements on travel and meals, and the §162 ordinary-and-necessary documentation across the practice — keep audit-posture as the default state of the return, not the emergency reconciliation cycle the week before the 30-day letter arrives.