The PT Deduction Checklist: What's Deductible and What Isn't

PhysioTax Updated October 2026 3 min read

A tax return is only as complete as the records behind it. For a self-employed PT or practice owner, a lot of everyday spending is deductible, but it has to be recorded, categorized, and supported. Use this checklist as a starting point.

Clinical equipment and supplies

Equipment you buy to treat patients is generally deductible. Rather than writing it off slowly over several years, you can often deduct much or all of the cost in the year you place it in service. Two tools make that possible, and they work together.

• Section 179 expensing. You choose to deduct the cost of qualifying equipment up front. For 2026 the limit is $2.5 million, which starts to phase out once total purchases pass $4 million. The deduction generally can't exceed your business's taxable income for the year.
• Bonus depreciation. Under current law, 100% bonus depreciation is available for most qualifying property acquired after January 19, 2025, new or used. It applies automatically unless you opt out, and unlike Section 179 it isn't capped by business income, so it can create a loss.

Which one fits, or how to combine them, depends on your income, your plans for the practice, and your state. Many states don't follow the federal bonus depreciation rules, so the state-level result can differ. That's a good reason to talk through a larger purchase before you make it.

• Treatment tables and plinths
• Ultrasound and electrical stimulation units
• Exercise bands, weights, therapy balls, and balance equipment
• Gait training equipment
• Disposable supplies such as electrodes, tape, and gloves

For larger purchases, we plan the timing with you so the deduction lines up with how the practice is doing that year.

Continuing education and licensure

Courses that maintain your license or build skills in your current specialty are deductible, along with specialty certification fees, conference registration, related travel, and state licensing and renewal fees.

Home office

If you do billing, scheduling, documentation, or telehealth from a space at home that you use regularly and exclusively for business, you may qualify. You can use the simplified method ($5 per square foot, up to 300 square feet) or deduct actual expenses. Note that employees on W-2 pay generally can't claim this deduction.

Practice software and billing tools

EMR subscriptions, billing and scheduling platforms, telehealth tools, and accounting software are ordinary business expenses.

Insurance

Professional liability (malpractice) premiums and general business insurance are deductible. These are often one of the larger annual expenses, so make sure they're coded correctly in your books.

Self-employed health insurance

Premiums for medical, dental, and vision coverage for you, your spouse, and your dependents may be deductible even if you don't itemize. The deduction can't exceed your net profit from the business, and it isn't available for any month you could have enrolled in an employer-subsidized plan.

Retirement contributions

Contributions to a SEP-IRA or Solo 401(k) can reduce your taxable income now while you build savings for later. See our guide on choosing between the two.

Dues, memberships, and business travel

Professional association dues, subscriptions, and travel between work locations are deductible. Business meals are generally limited to 50%. Keep a mileage log for any driving between sites.

What isn't deductible

• Commuting between home and your regular place of work
• Personal expenses, or the personal share of mixed-use items
• Clothing suitable for everyday wear, even if you wear it only at work
• Fines and penalties
• Federal income tax payments
• Student loan principal. Student loan interest is a separate personal deduction with its own limits, not a business expense.
• Anything you can't document

Make it easy on yourself

Use a dedicated business bank account and card, save receipts as you go, and review your books monthly. When the records are clean, claiming everything you're entitled to becomes routine rather than a year-end scramble.

Want this applied to your numbers?

We keep your books organized all year so every eligible expense is captured and supported. Book a 30-minute call and we'll look at your situation together.

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