Can freelancers deduct are promotional items tax deductible?

Promotional items can be deducted as advertising expenses if they are used to promote your business and are not considered lavish or extravagant. These items must be directly related to your business activities and should be distributed with the intention of generating business income. Common examples include branded pens, calendars, or mugs. However, if the items are considered gifts, they may be subject to the $25 per recipient per year limit. It's important to distinguish between promotional items and gifts to ensure proper deduction. For instance, a branded pen given to a client at a trade show is a promotional item, while a holiday gift basket could be considered a gift.