Can I Write This Off?

What are the deduction categories

TL;DR

Business expenses are generally deductible if they are ordinary and necessary for the operation of the business, but personal expenses are not deductible unless specifically allowed by the IRS.

Detailed Answer

Business expenses can be deducted if they are both ordinary (common and accepted in your trade or business) and necessary (helpful and appropriate for your business). Common deductible categories include advertising, office expenses, travel, meals (subject to a 50% limit), and utilities. Personal expenses are not deductible unless they have a specific provision, such as the home office deduction. Mixed-use expenses, like a vehicle used for both personal and business purposes, require allocation between business and personal use. Certain expenses, like entertainment, are no longer deductible under current tax law.

Where to Put It on the Tax Form

Schedule C, Line 27a for other expenses; specific lines for categories like Line 8 for advertising.

Real World Example

A freelance graphic designer can deduct the cost of software subscriptions (e.g., Adobe Creative Cloud) as an office expense on Schedule C. If the subscription costs $600 annually, this amount is fully deductible as it is both ordinary and necessary.

Audit Risk & Documentation Tips

Moderate audit risk. Keep detailed records, such as receipts, invoices, and bank statements, to substantiate each expense. For mixed-use items, maintain logs or records showing the business versus personal use, such as a mileage log for vehicle expenses.

IRS Reference

IRS Publication 535, Business Expenses; IRC §162.

Relevant Industries

FreelancersConsultantsSmall Business OwnersReal Estate Agents

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Disclaimer: This is for informational purposes only and should not be construed as tax or legal advice. Always consult your tax advisor.

Page created on February 24, 2026

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