Do I have to upgrade to TurboTax Self Employed from Deluxe to report business expenses?

Yes, if you are self-employed and your expenses relate to your business.

No, if you are an employee, and your expenses relate to your W-2 income.

If your business is a Partnership or a Corporation, you would need a separate product, TurboTax Business, which is only available as a CD or Download.

This is ridiculous - used to be able to do this without "upgrade". We'll be looking into other programs next year.

I agree.  I used to be able to enter these expense without the upgrade.  Turbo tax has just lost a 13 year customer.