Can I enter the cost of TurboTax as a business expense in my self-employed tax return and where in TurboTax can I enter it? Does TurboTax enter it automatically for me?

[JohnW152]

These fees are no longer allowed as a Miscellaneous Itemized Deduction on your return, but you can claim a portion of the cost on your Schedule C, since you’re self-employed.

To do this, compare the TurboTax Self-Employed price to the cost of the TurboTax version you would've used were it not for your self-employment reporting needs.  If the Self-Employed price is higher than the other version, you can claim the difference on your Schedule C as a self-employment tax prep expense -- because this is actually the expense for your self-employment needs. 

You'll have to enter it yourself.

To enter your business portion of the tax prep software cost in TurboTax Online:

1. Type schedule c in the Search box

2. Select the Jump to schedule c link

3. Answer Yes to Did you have any self-employment income or expenses? and answer the questions until you get the What kind of expenses did you have for XXX? screen. Select your expenses, then Continue

   1. If you've already worked in this section, select Edit next to your business, then Add expenses for this work

4. Select Start next to an expense type that you had

5. Enter your expense description and amount, and answer any other questions we ask

6. If you had more than one expense for a type, select Add another group to include them all

7. If you have additional expenses of other types, repeat steps 3 through 5 to add more

You can categorize this as an Office Expense.

To enter your personal (i.e., the non-self-employment) portion of the tax prep software cost in TurboTax Online:

1. If you’re on the Hi TurboTax Client, let's keep working on your taxes! screen, click the Pick up where you left off button

2. Click Federal in the left pane, if you’re not already there

3. Click Deductions & Credits in the banner

4. Scroll down and click Show more to the right of Other Deductions and Credits

5. Click Start to the right of Tax Preparation Fees

6. Enter all relevant information on the subsequent screens

Tax preparation fees aren't deductible on your federal return, but some states still allow a deduct for them on your state return. 

The TurboTax program will figure out whether these expenses can affect your state return and do the calculations for you.

[Edited 30/03/2022 | 10:57 am PST]

@taxi2020