Freelance designer with a home office
1099-NEC and direct client income, real business expenses, a home office, and quarterly estimates. Schedule C, self-employment tax, and the QBI deduction all come into play.
Taxpayer facts
Who this is and what their year looked like.
Maya is single, with no dependents, and works as a self-employed graphic designer in Austin, Texas. 2025 was a solid freelance year with several marketing agencies and studios.
She works from a dedicated room in her apartment, pays for her own software and tools, hired a subcontractor for one project, and made quarterly estimated tax payments. She keeps her books on a cash basis.
- NameMaya P. Delgado
- Date of birth07/22/1991
- SSN461-23-7788
- Age (as of 12/31/2025)34
- Filing statusSingle
- DependentsNone
- OccupationSelf-employed graphic designer
- Business nameMaya Delgado Design (sole proprietor)
- Accounting methodCash
- Address3110 Guadalupe St, Apt 12, Austin, TX 78705
- ResidencyTexas, full year (no state income tax)
- 2025 estimated tax payments$6,500 federal: $1,625 each on 4/15/2025, 6/16/2025, 9/15/2025 and 1/15/2026
- 2024 returnAGI $39,000; total tax $6,200
Source documents
Work from these the way you would a real client's paperwork. Everything is fictional.
Objectives
What a correct return should capture.
- Report ALL business income on Schedule C: both 1099-NECs plus the income paid directly that never appeared on a 1099.
- Deduct the ordinary and necessary business expenses. Remember meals are only 50% deductible, so only half of what was paid for meals counts.
- Take the home-office deduction with the simplified method: the office's square footage times the $5 per square foot rate.
- Arrive at the Schedule C net profit (line 31).
- Compute self-employment tax on Schedule SE (15.3% on 92.35% of net profit).
- Take the above-the-line adjustment for one-half of the SE tax.
- Compute the qualified business income (QBI) deduction on Form 8995, and watch the 20%-of-taxable-income limit.
- Apply the 2025 standard deduction ($15,750) and the estimated payments to find the refund or balance due.
- Note that Texas has no state income tax, so there is no state return here.
Check your work
The answer key and the complete return, the way a real client receives it: the 1040 and its schedules, the workpapers behind every number, and the signature forms.
Stuck? Work through it with Yehuda
A one-on-one, 30-minute tutoring session on this return with Yehuda Tenenbaum, EA. Bring the spot where you got stuck and we will work through it together: how the forms connect, why a figure lands where it does, and how to check your work. $250. This is education on the practice return, not advice on your own taxes.