Phone Deductions

[LittleExplorers]

Can you clarify what can be deducted on cell phones? We have a family plan with my husband having one phone and myself the other. Licensing requires a phone, which I would have any way as we don't have a home phone. Is it t/s on my line? What about the phone itself? I had to buy a new one to go to a family plan.

Thanks!

[TomCopeland]

Originally Posted by LittleExplorers

Can you clarify what can be deducted on cell phones? We have a family plan with my husband having one phone and myself the other. Licensing requires a phone, which I would have any way as we don't have a home phone. Is it t/s on my line? What about the phone itself? I had to buy a new one to go to a family plan.

Thanks!

You can't deduct the first phone line into your home, whether it's a landline or cell phone. Choose one to be your first phone line. So, you could say that your husband's phone is the first line and then that would not be deductible. You could deduct the business portion of your phone line. Use your time-space% or some actual business use percentage. It doesn't matter that licensing requires you to have a phone. You could also deduct the business portion of the cost of your phone.

[storybookending]

Originally Posted by TomCopeland

You can't deduct the first phone line into your home, whether it's a landline or cell phone. Choose one to be your first phone line. So, you could say that your husband's phone is the first line and then that would not be deductible. You could deduct the business portion of your phone line. Use your time-space% or some actual business use percentage. It doesn't matter that licensing requires you to have a phone. You could also deduct the business portion of the cost of your phone.

Hey Tom I have seen you post about this before and knew about it but can you tell me the reason why a phone or the T/S% cannot be deducted as a business expense? Like what is the actual wording on why? I am wondering because licensing does require it here as well and also many people use phones in place of computers to look up crafts, post on here, contact parents etc etc as well as the fact that it is needed in case of an emergency.

[TomCopeland]

Originally Posted by storybookending

Hey Tom I have seen you post about this before and knew about it but can you tell me the reason why a phone or the T/S% cannot be deducted as a business expense? Like what is the actual wording on why? I am wondering because licensing does require it here as well and also many people use phones in place of computers to look up crafts, post on here, contact parents etc etc as well as the fact that it is needed in case of an emergency.

Many years ago Congress passed a rule that disallowed the deduction for the first phone line into a home based business. I asked the IRS whether a provider who is required to have a phone (and didn't previously have a phone!) could deduct it. The answer was no. It doesn't matter if you are required to have one. You can still deduct the business portion of a second or third phone line. IRS Publication 529 (page 16) clearly states this: https://www.irs.gov/pub/irs-pdf/p529.pdf

[hwichlaz]

I'm no way an expert, but I read that it's because just living requires a phone these days. That you have to have one either way. Same reason you can't T/S your wardrobe. You can't live life naked, lol.

[Blackcat31]

Originally Posted by storybookending

Hey Tom I have seen you post about this before and knew about it but can you tell me the reason why a phone or the T/S% cannot be deducted as a business expense? Like what is the actual wording on why? I am wondering because licensing does require it here as well and also many people use phones in place of computers to look up crafts, post on here, contact parents etc etc as well as the fact that it is needed in case of an emergency.

You can deduct the cost of the internet (T/S % of course) for that part of phone use.