Tax Deductions For Your Online Business

Guest Post by Gabrielle Greene

Tax time came and went as it does every year, only this year it took a big chunk of my money with it. I cried, I moved on and now I’m writing about it.

As a full-time blogger and affiliate marketer, handing over a big check at the end of the year was painful beyond measure.

But, the fact is that bloggers and marketers incur costs and need to make sure they are offsetting some of those expenses. However, before claiming any tax deductions, double check to make sure the items you are claiming are directly related to your online business...

Home Office Supplies

If most or all of your blogging occurs in your home office, you can deduct many of the supplies that you regularly use, but again, they must be used and related to blogging.

This can include but is not limited to laptops, desks and chairs, cellphones, tablets, desktops, monitors, keyboards, headsets and printers and even the ink for said printer – any piece of equipment that helps you to carry out your blogging functions.

For instance, if you blog about photography, you can deduct the cost of the camera you use. If you regularly make videos, you can deduct the webcam or camcorder that you use to make them. If you have a cellphone that you use solely for your business as a blogger, that is also tax deductible but even if it’s not solely for blogging you can claim a portion of the bill if it is used for your business. For instance, I claim my BlackBerry add on service as a deduction. The list goes on.

Online Expenses

As a blogger a large majority of your expenses will be for online services and most of those are also tax deductible.

Blogging requires hosting, domain names, plugins, advertising, web design and graphics, stock photos, books and specific programs such as a newsletter (Aweber).

Even if you don’t have separate Internet access for your blogging business, like that of your cellphone, you can claim a percentage of the total bill. Any services that are necessary from paying for a customized WordPress design to SEO services and social media consulting, to hiring a ghost writer, can all be tax deductible.

Other Tax Advantages for Bloggers

Business tax preparation costs for the year prior.

Business incorporation costs – did you move beyond a sole proprietorship this year and incorporate a business online or form an LLC?

Annual Business license and DBA (doing business as) license renewal

Travel expenses – did you travel to a conference? All costs incurred can be deducted.

There are several other things that can be deducted as well and that will depend on your blogging business and structure and also the state that you live in as the laws can vary. But, before you take any deduction, it is a smart idea to check with a tax professional and make sure you are eligible for all the tax breaks you are claiming and that you are using them to your advantage so that you aren’t left paying out a large sum of money come year end.

Receipts & Expenses

Lastly and most importantly, keep detailed records and receipts throughout the year to support all your tax deductions and claims. Audits happen and should you find yourself in that situation you will need all to support the claims you made with receipts. Properly managing your business and money is important not only to your bank account but the growth of your business.

About the Author:

-- My name is Gabrielle Greene, I blog at TipsOnHowToSaveMoney. My friends often refer to me as “Gaby Gabs A lot,” especially if it has anything to do with freebies and saving money! As the mom of two teenage girls, being frugal is an absolute must. It tends to drive my husband crazy, but oddly he doesn’t complain when the coupons are for golfing.

Disclaimer: The information shared here is not intended as tax advice, but rather a General discussion on tax deductions between bloggers and online business owners. For detailed guidance, seek advice from a professional tax adviser in your area.