Bus, Subway, Train and Taxi Fares for Freelancers: When Public Transit Is Deductible and What Records to Keep (2026)

Published: October 23, 2026 · Reading time: 9 min

TL;DR: For a self-employed freelancer, a bus, subway, train or taxi fare is deductible when it is business transportation: getting from one workplace to another, visiting a client, or reaching a temporary work site, subject to the conditions below. The ride between your home and your regular place of work is commuting and is not deductible. Fares under $75 generally do not need a receipt, but you still need a record of the amount, date, place and business purpose. Rules differ with your facts, so confirm with a CPA or EA.

Freelancers who drive have a mileage log. Freelancers who ride the subway often have nothing, and the fares quietly disappear from the return.

This guide covers the non-car side of local transportation: what counts, what is commuting, and what to save. If you drive, start with commuting miles vs business miles and the 2026 mileage rates.

The Core Rule: Business Transportation vs Commuting

Publication 463 groups local transportation into two buckets, and the line between them is the whole question.

The business bucket is described this way: transportation expenses include the ordinary and necessary costs of getting from one workplace to another in the course of your business when you are traveling within the city or general area of your tax home, visiting clients or customers, and going to a business meeting away from your regular workplace. Publication 463 also lists getting from your home to a temporary workplace when you have one or more regular places of work.

The commuting bucket is blunt:

"You can’t deduct the costs of taking a bus, trolley, subway, or taxi, or of driving a car between your home and your main or regular place of work. These costs are personal commuting expenses."

The same passage adds that you cannot deduct commuting expenses no matter how far your home is from your regular place of work. Making business calls on the ride does not change that.

Four Situations, Four Answers

The answer turns on where you work, not on the vehicle. The same $2.90 fare can land on either side.

1. You have a qualifying home office

Publication 463 says:

"If you have an office in your home that qualifies as a principal place of business, you can deduct your daily transportation costs between your home and another work location in the same trade or business."

So a freelancer with a qualifying home office can generally deduct the subway ride from home to a client site. Qualifying is a strict test: see Publication 587 and our home office mileage rule guide.

2. You have no office and no qualifying home office

Publication 463 treats the location of your first business contact inside the metropolitan area as your office. The ride from home to that first contact, and from the last contact back home, is commuting. But:

"While you can’t deduct the costs of these trips, you can deduct the costs of going from one client or customer to another."

3. You work in two places in one day

"If you work at two places in 1 day, whether or not for the same employer, you can deduct the expense of getting from one workplace to the other. However, if for some personal reason you don’t go directly from one location to the other, you can’t deduct more than the amount it would have cost you to go directly from the first location to the second."

That direct-route cap is the same one that applies to driving. See personal errands between clients.

4. You go to a temporary work site

Publication 463 lets you deduct daily round-trip transportation between home and a temporary location in the same trade or business when you have one or more regular work locations away from home, regardless of distance. Work at a location realistically expected to last, and that does last, 1 year or less is temporary unless facts and circumstances indicate otherwise. If you have no regular place of work, Publication 463 allows daily transportation between home and a temporary site only when the site is outside the metropolitan area where you ordinarily work; temporary sites inside that area are commuting. Details are in our temporary work location guide.

Overnight Trips: Train, Bus and Taxi Are Travel, Not Local Transportation

If the trip takes you away from the general area of your tax home substantially longer than an ordinary day's work and you need to sleep or rest, Publication 463 treats it as travel. Its travel table lists transportation by airplane, train, bus or car between your home and your business destination, plus taxi, commuter bus and airport limousine fares between the airport or station and your hotel, and between the hotel and your client's work location, meeting place or temporary work location.

Two details matter for fares:

• A free ticket or frequent-traveler ride costs you nothing, and Publication 463 says "your cost is zero." Points-only bookings generally produce no fare deduction.
• Overnight travel brings lodging and meal records into the file. See airport trips and rideshare and rental cars and rideshares on business trips.

Where the Fares Go on Schedule C

The 2025 Schedule C instructions describe line 24a this way:

"Enter your expenses for lodging and transportation connected with overnight travel for business while away from your tax home."

Line 9 is for operating your own car or truck. A same-day subway or taxi fare fits neither description cleanly. The instructions for Part V line 48 say:

"Include all ordinary and necessary business expenses not deducted elsewhere on Schedule C."

Many preparers therefore list local fares as an other expense. That is a judgment call, so ask your CPA or EA which line they use. For the broader line map, see how to categorize expenses for Schedule C.

What Records Satisfy the IRS

Publication 463 says to keep proof in an account book, diary, log, statement of expense, trip sheets or a similar record, and to support each element with documentary evidence. Documentary evidence is not needed in two cases that matter here:

"Your expense, other than lodging, is less than $75."

"You have a transportation expense for which a receipt isn’t readily available."

That is relief from the paper receipt, not from the record. The elements still have to be recorded, and Publication 463 says to do so at or near the time of the expense. Two practical points follow.

Combining is allowed. Publication 463 says you can make one daily entry for reasonable categories of expenses, and its examples include taxi fares. Fares of a similar kind on one day can usually share a line.

A tap history is half a record. A transit card or app history shows amount and date. It rarely shows why you rode. Add the client or purpose to your log. For wording that holds up, see what to write as the business purpose.

Whether a receipt is "readily available" is a fact question. When in doubt, screenshot it: the $75 receipt rule guide and which expenses need receipts go deeper.

Worked Example: One Month of Fares

This is a hypothetical. The fares are invented round numbers, not any agency's real prices.

A freelance copywriter has a home office that qualifies as her principal place of business. In one month she records:

Her transit card history shows $75.40 of subway fares (9 + 4 round trips). Only $52.20 of that is deductible. Added to the taxi and train, deductible fares for the month are $191.70 ($52.20 + $43.50 + $96.00).

What she keeps:

• The $96.00 train e-ticket, because it is above $75.
• Taxi app receipts, which cost nothing to keep.
• A log line for each deductible ride with date, route, client and purpose.
• A downloaded ride history from the transit agency, with the four personal rides marked.

If she had no qualifying home office and no other regular workplace, the nine home-to-client rides would be commuting under the first-contact rule, and the deductible total would drop to $139.50 (taxi $43.50 plus train $96.00), and the train fare stays deductible only if the client is outside her metropolitan area; if the client is inside it, the total would be $43.50. Your CPA or EA decides the reporting line for each.

How Long to Keep the Records

Publication 463 says to keep records "for 3 years from the date you file the income tax return on which the deduction is claimed" and that a return filed early is considered filed on the due date. For a 2026 return filed on or before April 15, 2027, that works out to April 15, 2030. Longer periods exist in some situations, covered in how long to keep receipts. State-law retention rules are not covered here.

If a fare is missing its record, see the Cohan rule and lost receipts for what can and cannot be reconstructed. Rides your client reimbursed need separate handling: see client-reimbursed expenses.

Common Mistakes

• Deducting the home-to-regular-workplace ride. A coworking desk you use every day is a regular workplace, so that ride is commuting.
• Leaving personal rides in the total. A transit card statement is not a deduction list.
• Logging the fare but not the purpose. The amount and date alone leave out an element Publication 463 expects.
• Treating a points ticket as a cost. If the ride was free, your cost is zero.
• Ignoring the direct-route cap. A detour for personal reasons limits the deduction to the direct cost.
• Assuming one rule fits every client. A temporary site, a second workplace and a regular workplace each get different answers on the same day.

Frequently Asked Questions

Can I deduct my monthly transit pass? Only the part that covers business transportation. A pass used partly for commuting and personal trips has to be allocated, and the commuting portion is not deductible. Ask a CPA or EA how to allocate it.

What if I drive some days and ride others? Track each mode separately. Driving uses the standard mileage rate or actual expenses: 72.5 cents per mile for business miles from January 1 to June 30, 2026 and 76 cents from July 1, per the IRS rates page. Fares are deducted at the amount paid.

Does it matter which bank card paid the fare? It matters for matching your records, not for deductibility. See business vs personal cards.

Keep Fare Records Without Extra Work

CentSense helps you capture the receipt side: photograph or upload a taxi, rideshare or train receipt, and the AI scan pulls out the vendor, date and amount so it is filed with the rest of your expenses. The free plan includes 10 AI receipt scans a month, and the Solo plan ($5/month) adds unlimited scans and CSV export. You still add the business purpose and decide with your CPA or EA which rides qualify.

Start a free CentSense account

Sources and References

• IRS: Publication 463, Travel, Gift, and Car Expenses (2025)
• IRS: Instructions for Schedule C (Form 1040) (2025)
• IRS: Publication 587, Business Use of Your Home
• IRS: Publication 583, Starting a Business and Keeping Records
• IRS: Standard mileage rates (2026: 72.5 cents Jan 1 to Jun 30 per IR-2025-128; 76 cents Jul 1 to Dec 31 per IR-2026-29)

This guide is general education for U.S. self-employed freelancers filing a Schedule C in 2026. It is not personalized tax advice. Whether a ride is business transportation or commuting, whether your home office qualifies, which Schedule C line to use, how long to keep records, and any state-law retention rules depend on your facts, so confirm them with a CPA or EA before you file.