Small tools deduction

amandaheredia945 · ‎June 4, 2019

When entering the amount for small tools deductions, can I just have a total what was spent or do I have to break them out individually?

MichaelMc · ‎June 4, 2019

No, please do not go to the trouble of breaking-out small tools, supplies, etc., individually. Just listing categories and amounts will be sufficient.

If you are self-employed or an independent contractor (your pay gets reported on a Form 1099-MISC rather than a W-2) then you can certainly deduct the cost of tools and supplies as a business expense.

Under the Business tab, select Business expenses > Other common business expenses;
Scroll down to Supplies;
This will take you to a screen where you may list categories of supplies (i.e., hand tools, supplies, etc.) and the associated amounts.

If you are an employee (pay is reported on Form W-2), you can claim those tools and supplies as an unreimbursed employee expense on Schedule A. This will only be a benefit to you if you itemize your deductions rather than taking the standard deduction. Further, unreimbursed employee expenses are subject to the 2% rule, meaning that you can only deduct the portion of the expense that exceeds 2% of your Adjusted Gross income.

For more information, please see IRS Pub. 529 Miscellaneous Deductions.

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MichaelMc · ‎June 4, 2019

No, please do not go to the trouble of breaking-out small tools, supplies, etc., individually. Just listing categories and amounts will be sufficient.

If you are self-employed or an independent contractor (your pay gets reported on a Form 1099-MISC rather than a W-2) then you can certainly deduct the cost of tools and supplies as a business expense.

Under the Business tab, select Business expenses > Other common business expenses;
Scroll down to Supplies;
This will take you to a screen where you may list categories of supplies (i.e., hand tools, supplies, etc.) and the associated amounts.

If you are an employee (pay is reported on Form W-2), you can claim those tools and supplies as an unreimbursed employee expense on Schedule A. This will only be a benefit to you if you itemize your deductions rather than taking the standard deduction. Further, unreimbursed employee expenses are subject to the 2% rule, meaning that you can only deduct the portion of the expense that exceeds 2% of your Adjusted Gross income.

For more information, please see IRS Pub. 529 Miscellaneous Deductions.