📅 Day 3: What Actually Counts as a Business Deduction?

 

📅 Day 3: What Actually Counts as a Business Deduction?

“Can I write this off?”
As a CPA, I hear this question all the time — and honestly, it’s a good one. Business deductions aren’t just about saving money on taxes; they’re also about understanding what counts as an ordinary and necessary expense in your field.

Here’s a simple breakdown to help make sense of it:

✅ The IRS Rule (in plain English)

To be deductible, an expense must be:

• Ordinary: Common in your industry
• Necessary: Helpful and appropriate for your business

It doesn’t have to be essential — just reasonable.

💼 Commonly Deductible Business Expenses

• Office Supplies & Software: Pens, printers, QuickBooks, Canva Pro
• Marketing Costs: Website hosting, email tools, social media ads
• Business Meals: 50% deductible when dining with clients or for business travel
• Professional Development: Courses, certifications, books related to your work
• Phone & Internet: Pro-rated for business use
• Mileage or Vehicle Use: For client meetings, supply runs, etc.

⚠️ Expenses That Might Be Deductible (If Properly Documented)

• Home Office: Only if used exclusively and regularly for business
• Travel: Flights, hotels, meals — but only if the trip is primarily for business
• Clothing: Not deductible unless it's a uniform or branded workwear
• Gifts: Limited to $25 per recipient per year

✍️ Pro Tip from a CPA (that’s me!)

When in doubt, write a quick note on the receipt or in your bookkeeping system:

“Lunch with design client to review draft logo”
That kind of detail turns a vague expense into a well-supported deduction.

Tomorrow’s post dives deeper into LLC vs. S-Corp vs. Sole Proprietor — one of the biggest areas where smart structure = serious tax savings. See you for Day 4!