If you’re running a private therapy practice, you already know that managing your own business means wearing a lot of hats. From client care to scheduling, billing, and bookkeeping, it can feel like there’s never a moment to breathe. One thing that shouldn’t get overlooked, though, is your taxes. The truth is, many therapists leave money on the table each year simply because they aren’t aware of all the deductions they qualify for.
The good news is that most of these deductions are straightforward, once you know what to look for. With a little planning and some organized bookkeeping, you can make sure you’re keeping more of the money you worked so hard to earn.
Here’s a friendly guide to the 10 business deductions therapists should look out for.
1. Home Office Deduction
If you see clients from home, it’s easy to assume you don’t qualify for a home office deduction unless you have a dedicated room. That’s not true. The IRS allows a deduction if you use a space regularly and exclusively for business. You can use the simplified method, $5 per square foot up to 300 sq ft, or the regular method, which lets you allocate mortgage interest, property taxes, utilities, and depreciation. Pick whichever method gives you a bigger deduction.
To claim it, report it on Schedule C. If you use the simplified method, calculate your square footage. If you choose the regular method, gather receipts for mortgage, insurance, utilities, and depreciation (Form 4562).
For record-keeping, take a photo of the space, measure it, and note the square footage. Tag these expenses in your bookkeeping as “Home Office 2025.” Even if your office is just a corner of a room, keeping records consistent year to year makes claiming the deduction stress-free.
2. Vehicle And Mileage Deductions
If you travel for work, whether to see clients at their homes, attend conferences, or run practice errands, mileage adds up. Many therapists forget to track it carefully, but the IRS allows you to deduct either the standard mileage rate, 70 cents per mile in 2025, or actual expenses like gas, insurance, and depreciation.
The trick is to log every trip as it happens. A simple spreadsheet or a mileage-tracking app is all you need. Record the date, purpose, start, and end miles, and you’re set. Come tax time, it will be simple to calculate your deduction, and you’ll avoid the headache of trying to reconstruct trips months later.
3. Continuing Education And Licensing
Keeping up with your CE requirements is essential, but did you know most of these costs are deductible? Registration fees, supervision, online courses, and travel to conferences all count, as long as they maintain or improve skills required in your current practice.
Claim it on Schedule C under “Education” or “Professional Development.” Save receipts, program descriptions, and certificates of completion. Keeping this organized ensures nothing is overlooked and helps your CPA defend the deduction if needed.
4. Telehealth Equipment And Software
If you’ve invested in cameras, microphones, computers, or ergonomic chairs for telehealth sessions, don’t forget these purchases may be deductible. Smaller items can often be expensed right away, while larger items may qualify for Section 179 or bonus depreciation, allowing you to deduct the cost in the year of purchase.
Keep receipts with the purchase date and note how the item is used in your practice. Tagging these in your bookkeeping ensures that when tax time comes, you don’t miss out on deductions for equipment that helps you run your practice efficiently.
5. Malpractice Insurance And Professional Liability Premiums
This is one of the simplest deductions to claim but also one that often slips through the cracks. Premiums for malpractice or professional liability insurance are fully deductible as ordinary business expenses.
Make it a habit to keep invoices and policy documents organized in your accounting software. Label them clearly so they are easy to find when it’s time to file taxes. This small step keeps your finances tidy and ensures you get the full deduction you deserve.
6. Professional Dues, Subscriptions, And Memberships
Memberships in professional organizations, online journals, and platforms that support your clinical work are deductible. It’s easy to overlook these if the organization also offers social benefits, but the portion that helps you maintain or improve your practice qualifies.
Save your receipts and jot down a quick note about how each membership supports your work. When tax time comes, you’ll have a clear story to back up each deduction.
7. Business Meals And Client-Related Meals
Meeting with clients or referral partners over a meal can qualify for a 50% deduction, but only if you document the business purpose. This is one area where therapists often forget to write down details or try to deduct the entire bill.
Keep a receipt and note who you were with, the date, and why it was a business meeting. A short, factual note is all you need to satisfy the IRS while keeping your records clean.
8. Client Gifts Up To $25
It’s nice to send a small gift to a client or referral partner, but there is a $25 per person deduction limit each year. Exceeding this or forgetting to track shipping costs can mean missed deductions.
Keep a simple log with the recipient’s name, the gift description, cost, and date. That way you can claim deductions without worrying about going over the limit or losing receipts.
9. Retirement Contributions (SEP IRA, Solo 401(k), SIMPLE)
If you have a SEP IRA, Solo 401(k), or SIMPLE plan, contributions are deductible and can significantly reduce your taxable income. Many therapists forget to take full advantage of these options, leaving money on the table.
Work with your CPA to calculate the deductible amount each year. Set a calendar reminder for contribution deadlines, often aligned with your tax return date. Keeping organized records ensures that you don’t miss out on the tax benefits of saving for your future.
10. Health Insurance Premiums
If you’re self-employed, you can deduct your health insurance premiums above the line, reducing your adjusted gross income. Many therapists miss this because they assume all business expenses go on Schedule C. Be aware that months when you had coverage through a spouse or other employer may reduce or eliminate the deduction.
Keep invoices and proof of payment, and let your CPA calculate the allowable amount on Schedule 1 (Form 1040). This can save thousands and is easy to overlook without careful tracking.
Keeping Your Books Organized
The best way to make sure you claim all these deductions is to stay organized throughout the year. Keep a separate business bank account, tag expenses in your bookkeeping software, and maintain folders for receipts, CE certificates, and mileage logs. Even a little bit of organization goes a long way toward reducing stress at tax time and keeping more money in your pocket.
TL;DR: Let’s Help You Claim Every Deduction
At TL;DR Accounting, we specialize in helping therapists in private practice stay organized and make the most of their tax deductions. A little planning now means you get to keep more of the money you earn and focus on the work you love.
Book a discovery call with us to review your finances and make sure you’re claiming every deduction available to your practice this year. You’ve worked hard for your clients. Now let’s make your finances work just as hard for you.
