Enrolled Agent Exam [Part 2] 03, Schedule C — Common Deductible Expenses

Enrolled Agent Exam [Part 2] 03, Schedule C — Common Deductible Expenses

From Finance Exam Prep by Ran Chen, EA, CFP®

April 30, 2026 · 4 min

About this episode

In this episode, Ran Chen discusses common deductible expenses for Schedule C and important distinctions for self-employed individuals.

This podcast is made by Ran Chen, who holds an EA license, Insurance and Securities licenses (Series 6, 63, 65), and the CFP® designation. He is passionate about opening access to high-quality exam preparation resources and helping learners prepare more effectively for professional certification exams. In this episode you will learn: - The two-part "ordinary and necessary" test required for all Schedule C deductions. - How to distinguish between deductible employee wages and non-deductible draws for a sole proprietor. - The crucial difference between deducting contract labor versus wages and the associated tax forms. - Why self-employed health insurance premiums are not deducted on Schedule C, a common exam trap. - The importance of documentation and the rule against deducting the personal-use portion of expenses. For more free exam prep tools, practice questions, and AI-powered explanations, visit https://open-exam-prep.com/ or YouTube Channel: https://www.youtube.com/@Open-exam-prep

People in this episode

Host: Ran Chen

Topics covered

  • Schedule C deductions
  • tax forms
  • self-employed health insurance
  • documentation
  • ordinary and necessary test

Keywords

  • Schedule C
  • deductible expenses
  • self-employed
  • tax deductions
  • ordinary and necessary
  • contract labor
  • employee wages
  • documentation

Mentioned in this episode

Organizations: CFP®, Insurance and Securities, Series 6, Series 63, Series 65, Open-exam-prep, YouTube Channel

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