Tax Write Offs for Notaries

When notaries witness signatures placed on documents to make them official, they can take a number of deductions for costs associated with providing their services. The U.S. government allows notaries to write off almost all of their business expenses if they work for themselves but limits deductions that employed notaries can take for out-of-pocket expenses to 2 percent of their adjusted gross income.

Most notaries purchase errors and omissions insurance to provide coverage in the event that they make an omission or mistake when verifying legal contracts, according to Roy Rasmussen of Notary CRM. Alternatively, their state may require them to put up money for a bond from which the bond writer will compensate a party wronged by a notaries’ mistake. A self-employed notary can deduct at the federal level 100 percent of insurance premiums and annual bond costs paid out-of-pocket on Form 1040, Schedule C, Line 15.

Notaries have to purchase a number of supplies, including paper, pens, postage and official stamps. They can deduct 100 percent of these costs in the year occurred on Form 1040, Schedule A or Schedule C, Line 18, according to the IRS. Self-employed notaries can deduct the costs of printers, copiers and computers on Form 1040, Schedule C, but they cannot usually take these deductions in a single tax year. For example, the Internal Revenue Service requires notaries to depreciate the costs of a computer over five tax years.

If notaries own their own business and lease out an office, they can take a full federal deduction for all rental payments on Schedule C, Line 20. Notary publics who operate out of their place of residence can deduct the portion of their house used for business purposes, including expenses for homeowners insurance, mortgage payments and property tax, by completing Form 8829 per IRS regulations.

Because many notaries travel to officiate documents, they should make sure to claim their transportation expenses. Notaries working for an employer can only deduct mileage expenses if they do not operate out of a permanent place of business, according to Notary CRM. Self-employed individuals can deduct 100 percent of their business miles driven. The IRS permits notaries to take a standard deduction of 51 cents per mile on Schedule A, and they will have to complete Form 2016 as of 2011. Alternatively, a self-employed notary public can deduct his actual vehicle expenses on Schedule A or C.

Notaries may possess memberships in associations, such as the National Notary Association, and they may have costs to become or remain certified, such as education expenses, licensing and license renewal fees. They can count these expenses as miscellaneous deductions on Schedule A if they are employees, and self-employed notaries can deduct all of these expenses on Schedule C.