# Smart Deductions

> Smart Deductions is a free, browser-based expense categorizer for 1099 contractors, freelancers, and single-member LLCs. Developed by Robert Van Liew. It reads bank statement PDFs and CSVs locally in the browser, automatically maps transactions to IRS Schedule C categories, and exports an audit-ready CSV — without uploading any financial data to a server.

## What it does

- Parses PDF, CSV, and ZIP bank statement exports from all major US banks (Chase, Bank of America, Wells Fargo, Capital One, Citi)
- Classifies transactions into 11 IRS Schedule C–aligned categories: Groceries, Dining, Shopping, Subscriptions, Gas & Transport, Utilities, Entertainment, Health & Medical, Insurance, Fees & Charges, Other
- Exports a pre-labeled Schedule C summary CSV ready for TurboTax or CPA handoff
- Exports a full transaction ledger XLSX for personal records
- Requires no account, no login, and no payment

## Who it's for

- Freelancers and independent contractors who receive a 1099-NEC
- Sole proprietors who file Schedule C (Form 1040)
- Single-member LLCs taxed as sole proprietors
- Small business owners who want to track deductible expenses without sharing bank credentials

## How it works

1. User uploads a PDF, CSV, or ZIP file exported from their bank
2. Smart Deductions parses the file locally using PDF.js — no server upload
3. A rule-based classifier assigns each transaction to a Schedule C category
4. User reviews and optionally edits categories
5. User exports a Schedule C summary CSV or full ledger XLSX

## Privacy and security

- Zero-Knowledge architecture: all parsing happens in the browser via local JavaScript
- No data is transmitted to any server
- No cookies, no analytics, no account required
- GDPR-friendly by design

## Frequently asked questions

Q: Is my financial data stored on a server?
A: No. Smart Deductions parses your PDF or CSV entirely inside your browser. Your transaction data is never uploaded, transmitted, or stored outside your device.

Q: What expenses can I deduct as a 1099 contractor or freelancer?
A: Common deductible expenses include home office costs, software subscriptions, internet and phone bills, business meals (50%), mileage and transport, professional services, insurance premiums, and equipment. Smart Deductions auto-tags these to Schedule C lines.

Q: Which bank statement formats does Smart Deductions support?
A: Standard bank statement PDFs, CSV/OFX exports, and ZIP archives of multiple statements. Works with exports from Chase, Bank of America, Wells Fargo, Capital One, Citi, and most US banks.

Q: What is Schedule C and who needs to file it?
A: Schedule C (Form 1040) reports profit or loss from self-employment. Required for sole proprietors, single-member LLCs, freelancers, and independent contractors who receive a 1099-NEC or earn self-employment income.

Q: How accurate is the automatic categorization?
A: The classifier uses merchant name and keyword matching against a rule set tuned for freelancer spending. Accuracy is typically 85–95%. Users can review and edit any label before exporting.

Q: Can I use Smart Deductions if I have an LLC?
A: Yes. Single-member LLCs taxed as sole proprietors file Schedule C and can use Smart Deductions directly. Multi-member LLCs and S-Corps have different filing requirements.

Q: Do I need to create an account?
A: No. No registration, login, or payment required. Open the app, upload your statement, export your CSV.

Q: Is Smart Deductions free?
A: Yes, completely free. No premium tiers, usage limits, or paywalls.

## Comparison

| | Smart Deductions | QuickBooks Self-Employed | Manual Spreadsheet |
|---|---|---|---|
| Cost | Free | ~$15–$35/mo | Free |
| Data leaves device | Never | Yes (cloud) | No |
| Account required | No | Yes | No |
| Auto Schedule C labels | Yes | Yes | Manual |
| PDF parsing | Yes | Via bank sync only | No |
| Bank credential sharing | No | Required | No |

## Author

Smart Deductions was designed and developed by Robert Van Liew.
URL: https://smartdeductions.app
GitHub: https://github.com/robertvanliew/smart-deductions

## Technical details

- Built with React 19, TypeScript, Vite, Tailwind CSS
- PDF parsing via PDF.js (Mozilla) — runs in-browser
- ZIP handling via JSZip
- All computation is client-side only
- No backend, no database, no API calls for user data