Is General Liability Insurance Tax Deductible? Yes — Here's How to Claim It
100%
Deductible
Line 15
Schedule C
Insurance (not health)
Category
$400–$1,500/yr
Typical cost
General liability insurance protects your business from lawsuits and customer claims — and the good news is that every penny of your premiums is tax-deductible. If you're self-employed or run a single-member LLC filing Schedule C, you can claim these costs as a business expense. This deduction typically saves you $150–$450 annually in taxes, depending on your tax bracket.
Who qualifies?
You qualify if you're self-employed, operate a freelance business, run a sole proprietorship, or own a single-member LLC filing Schedule C. General liability insurance premiums are deductible regardless of your industry—whether you're a contractor, consultant, e-commerce seller, or service provider.
How to claim it
- 1 Gather your general liability insurance policy documents and annual premium statements or invoices from your insurance provider.
- 2 Add up all business liability insurance premiums paid during the tax year (exclude health, disability, and workers' comp if filed separately).
- 3 Enter the total amount on Schedule C, Line 15 (Insurance—not health) when filing your tax return.
Pro tip
Don't mix general liability insurance with health insurance or workers' compensation on Line 15—those go elsewhere on your return. Keep organized by category: business liability premiums go on Schedule C Line 15, while health insurance premiums are claimed on Schedule 1. This prevents audit flags and ensures you get full credit for all eligible deductions.
Source: IRS Publication 535: Business Expenses
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