Quick Answer
The 2026 standard deduction increase to $15,000 (single) helps freelancers with low business expenses, but most full-time freelancers still benefit more from itemizing. The increase primarily helps side hustlers who can now use the standard deduction instead of tracking small business expenses.
Best Answer
James Okafor, Self-Employment Tax Specialist
People with day jobs who do small amounts of freelance work
How the standard deduction increase helps side hustlers
The 2026 standard deduction increase is particularly beneficial for side hustlers with modest freelance income and business expenses. Many side hustlers can now skip the complexity of itemizing and tracking small business expenses.
Before vs. after the increase
2025 standard deduction: $14,600 (single), $29,200 (married filing jointly)
2026 standard deduction: $15,000 (single), $30,000 (married filing jointly)
While the increase seems modest ($400 for single filers), it pushes more side hustlers over the threshold where the standard deduction exceeds their itemized deductions.
Example: Side hustler with small business expenses
Meet Jennifer, a marketing manager who does freelance social media work on weekends:
2025: Jennifer would itemize ($13,700 > $14,600 standard deduction)
2026: Jennifer takes the standard deduction ($15,000 > $13,700 itemized)
Tax benefit: Jennifer saves $1,300 in additional deductions ($15,000 - $13,700) while eliminating the need to track and document small business expenses.
Who benefits most from the increase
Side hustlers who benefit most have:
For these taxpayers, the administrative burden of tracking business expenses often outweighed the tax benefit.
Schedule C still required for self-employment tax
Important: Even if you take the standard deduction, you still must file Schedule C for your freelance income to calculate self-employment tax (15.3% on net earnings).
The standard deduction doesn't eliminate this requirement — it only affects your income tax calculation.
Record-keeping becomes optional for small expenses
With the higher standard deduction, side hustlers with minimal business expenses can choose to:
However, you should still track expenses in case they grow larger than expected or if tax laws change.
State tax considerations
Remember that state standard deductions didn't necessarily increase. If you live in a high-tax state, you might still benefit from itemizing on your state return even if you take the federal standard deduction.
What side hustlers should do
Calculate your total potential itemized deductions (including business expenses) and compare to the $15,000 standard deduction. If itemized deductions are within $1,000-$2,000 of the standard amount, consider taking the standard deduction for simplicity.
Use the deduction finder tool to identify any large deductions you might be missing before making this decision.
Key takeaway: The 2026 standard deduction increase to $15,000 helps side hustlers with under $2,000 in business expenses avoid complex record-keeping while still getting full tax benefits, saving time and reducing audit risk.
*Sources: IRS Publication 501 (Exemptions, Standard Deduction, and Filing Information), One Big Beautiful Bill Act of 2025*
Key Takeaway: Side hustlers with under $2,000 in business expenses can now take the $15,000 standard deduction instead of itemizing, simplifying taxes while maintaining full benefits.
Standard vs. itemized deduction comparison by freelancer type
| Freelancer Type | Typical Business Expenses | Other Deductions | Best Strategy |
|---|---|---|---|
| Side hustler | $500-$2,000 | $8,000-$13,000 | Standard deduction if total under $15,000 |
| Full-time freelancer | $9,000-$26,000 | $8,000-$15,000 | Always itemize |
| Part-time rideshare | $8,000-$12,000 | $3,000-$8,000 | Compare both options |
| Full-time rideshare | $20,000-$35,000 | $3,000-$8,000 | Always itemize |
More Perspectives
Priya Sharma, Small Business Tax Analyst
Self-employed individuals with substantial business expenses
Standard deduction increase has minimal impact on full-time freelancers
Most full-time freelancers have business expenses that far exceed the standard deduction, so the 2026 increase from $14,600 to $15,000 doesn't significantly change their tax strategy.
Typical full-time freelancer deductions
Full-time freelancers commonly have:
Plus personal itemized deductions like state taxes and mortgage interest often add another $8,000-$15,000.
With total deductions typically ranging from $17,000-$41,000, the standard deduction rarely makes sense for established freelancers.
The $400 increase doesn't matter much
The modest $400 increase in the standard deduction ($14,600 to $15,000 for single filers) is insignificant compared to most full-time freelancers' total deductions.
However, it does provide a small safety net. If you have an unusually low-expense year or forget to track some deductions, the higher standard deduction provides slightly better fallback protection.
Focus on maximizing business deductions instead
Rather than worrying about the standard deduction, full-time freelancers should focus on:
New deductions added in 2026
The One Big Beautiful Bill Act added several new deductions that benefit full-time freelancers more than the standard deduction increase:
These new deductions typically provide $1,000-$5,000 in additional savings — far more than the $400 standard deduction increase.
What full-time freelancers should do
Continue itemizing deductions and focus on maximizing business expenses rather than relying on the standard deduction. The increase provides minimal benefit compared to proper expense tracking and tax planning.
Key takeaway: The standard deduction increase barely affects full-time freelancers since their business expenses typically exceed $15,000-$25,000 annually, making itemizing far more valuable than the modest $400 increase.
Key Takeaway: Full-time freelancers should ignore the standard deduction increase and focus on maximizing business deductions, which typically provide $5,000-$15,000 more in tax savings.
James Okafor, Self-Employment Tax Specialist
Drivers for Uber, Lyft, DoorDash who may have varying expense levels
Standard deduction impact varies widely for rideshare drivers
The standard deduction increase affects rideshare and delivery drivers differently depending on their driving volume, vehicle expenses, and other personal deductions.
Part-time vs. full-time drivers
Part-time drivers (under 15,000 business miles annually):
Full-time drivers (over 30,000 business miles annually):
The break-even calculation
Rideshare drivers should compare:
Standard deduction route:
Itemized deduction route:
Example: Low-mileage driver analysis
Tom drives for DoorDash part-time:
Tom should itemize for the extra $400 benefit, but the standard deduction is close enough that he might choose it for simplicity.
State tax complications
Many rideshare drivers live in states with different standard deduction amounts. You might take the federal standard deduction but itemize on your state return, or vice versa.
Vehicle expense method matters
Drivers using the actual expense method (instead of mileage rate) typically have higher deductions:
What rideshare drivers should do
Track your mileage and expenses for the first quarter, then project annual totals. Compare itemized vs. standard deduction amounts. Many part-time drivers will find the standard deduction competitive, while full-time drivers almost always benefit from itemizing.
Key takeaway: Part-time rideshare drivers with under 15,000 business miles may benefit from the $15,000 standard deduction for simplicity, while full-time drivers should continue itemizing to claim vehicle expenses exceeding $20,000 annually.
Key Takeaway: Part-time rideshare drivers may benefit from the higher standard deduction, but full-time drivers with 20,000+ business miles should continue itemizing for maximum tax savings.
Sources
- IRS Publication 501 — Exemptions, Standard Deduction, and Filing Information
- One Big Beautiful Bill Act of 2025 — Standard deduction amounts for 2026 tax year
Reviewed by James Okafor, Self-Employment Tax Specialist on February 28, 2026
This content is for educational purposes only and is not a substitute for professional tax advice. Consult a qualified tax professional for advice specific to your situation.