At first glance, it may not seem that you are spending a great deal on your blogging endeavors.
However, the fact is that blogging does cost money. And, if you are making income from your blogging, you might want to offset some of that with the help of tax breaks for your costs.
Before you go claiming tax breaks, though, it is a good idea to double check to make sure that the items you claim truly are related to your blogging efforts.
If you are looking for some blogger tax deductions, here are some things to consider:
Home Office Supplies
If you are blogging from a home office, you can deduct a lot of the supplies that you use. (Just make sure you are using them only for your blogging efforts.)
This can include equipment depreciation for computers, as well as the chair you sit in, the desk you use and things like calendars, pens, headsets, external hard drives, and telephones.
You can also deduct supplies that go with a specific type of blogging that you do.
If you have a photo blog, you can deduct the cost of the camera you use. If you need to buy a web cam to make videos you post on your blog, that can be deductible as well. If you have a dedicated cell phone used specifically in connection with your business as a blogger, some of those expenses are tax deductible.
You’re a blogger, so most of your expenses are likely to be related to your online activities. Luckily, these are tax deductible.
The cost of WordPress plug-ins, web hosting, online advertising that you do, premium WordPress themes (like Genesis), newsletter costs (like Aweber like we use here) and domain name expenses (we love Namecheap) are all tax deductible. Web design, graphics and logos, maintenance and even Internet access can be deducted.
Even if you don’t have separate access for your blogging business, you can take a percentage of your total bill.
My broadband Internet bill is $39.99 a month, and about 80% of our Internet usage is accounted for by my professional blogging and freelancing business. As a result, $31.99 of our bill is eligible for a tax break.
On top of that, if you get SEO services or pay for social media consulting to help you improve your blog’s traffic, you can also get a tax break for those costs.
You can also get a tax break for access to subscriptions sites that you use for researching your blog posts and the costs of access stock image sites.
Use of Your Home
If you have a dedicated home office space, you can get a tax break for the business use of your home related to your blogging activities. Figure the square footage of your office space, and then use that to figure what percentage of the total square footage of your home you are using for your blogging activities.
My home office takes up about 2% of the square footage in my home. This means that I can get a tax break for 2% of the utilities I pay, my mortgage payment and my homeowner’s insurance premium. All of that adds up to close to a $400 tax break.
Not something to sneeze at.
Other Blogger Tax Breaks
There are a number of other tax breaks that bloggers might be eligible for. These include:
- Tax preparation costs for your business.
- Business incorporation costs if you decide to move beyond a sole proprietorship (e.g. LLC or S-Corp).
- Business license renewal.
- Salary and contract fees you pay to those who do work for you.
- Travel expenses related to your blogging. (I deduct costs related to BlogWorld attendance.)
- Trade show fees.
- Offline advertising costs, including business promotion like letterhead and business cards.
- Annual fees for business credit cards.
- Mailing materials.
Before you take a deduction, it is a good idea to check with a tax professional, and make sure that you are truly eligible for the tax breaks you want.
Here are some other resources on blogging tax deductions to read:
Self Employed Tax Deductions – Ideas for Self Employed Tax Deductions
46 Tax Deductions that Bloggers Often Overlook
How Starting a Business Can Lower Next Year’s Tax Bill
I like the tax breaks! All of these items may not seem like much when you look at each one separately, but together, they certainly save some money in taxes! 🙂 Thanks again.
Glen Craig says
Yes all of the deductions do add up and help to maximize your income.
Sustainable PF says
Great tips FFB! We haven’t accumulated much expense in our first few months but i’ll keep this post handy for 2011 tax time!
Glen Craig says
Keep strict records of everything! You’ll be amazed at what expenses can accrue over a year.
Do you go to an accountant to prepare your taxes now, or are these deductions pretty simple to do yourself using a program like TurboTax?
TurboTax should be able to walk you through business deductions.
Personally, I’ve used TorboTax in the past and it was great but my wife and I now use a CPA we were referred to.
Make sure to take all the deductions that you can as a blogger, I’m amazed at how many expenses I was able to dig up last year – everything from staff writer payments to hosting costs and internet. It resulted in decent tax savings.
It’s also important to actually track those expenses during the year so that when the time comes, you can claim them!
Absolutely Peter. And as a blogger, why not get the deductions a larger business would get as well?
Tracking everything is very important. I make sure to keep track of everything monthly and create PDF’s of any receipts I may need as backup.
Mike Piper says
“This means that I can get a tax break for 0.02% of the utilities I pay, my mortgage payment and my homeowner’s insurance premium. All of that adds up to close to a $400 tax break.”
I suspect you meant 2% (or 0.02) rather than 0.02%. Either that, or you have one heck of a house! 😀
Sorry, I realize I am late to the party. But, I believe when it comes to home office deductions it isn’t just the square footage %, but also the time you work in the office. At least that is what we have to do for the day care. So the day care operates about 30% of the available hours during the week (50/168). We multiple that times the percentage of the square footage. And then use that final % for the tax deduction.
You’re right; pesky decimals and what not. Yes. 2%. And then, of course, when doing the math one multiplies by 0.02. Sorry for the mix up.
Mike Piper says
I’m just playing. I think it’s pretty clear what you meant. The idea of using 0.02% of one’s house for an office just amused me. 🙂
Great job with the article, by the way.
I think that overlooked tax deductions are something that really hurt small business owners. Especially people who run “non-traditional” businesses like a website! Very good and timely reminder!
I certainly will keep these ideas in mind, although I am still working on generating income.
I will keep my camera lens receipt and deduct it in 2012!
Crystal @ BFS says
I’m printing this off and filling in the questions so my husband doesn’t miss anything come tax time. 🙂
Do you have to be making money or can you declare the loss? Also, would I have to become an official sole proprietorship? I just gave myself a great idea!
Thanks man, super article.
CD Rates Blog says
@Echo – I have used TurboTax for years and it gives great suggestions for deductions and the like. We also have a daycare and TurboTax has handled that well.
@citymom2 – You can declare a loss, but keep in mind if questioned you have to be able to show you were working to make a profit. Expenses for hobbies are not deductible. Most business don’t start seeing black for 3 to 5-years, but each year should improve.
Thank you! I remember reading this in a tax book. Thanks for the reminder.
Great list of tax breaks. I’m printing them off as well to make sure I add them all up.
Jacob @ My Personal Finance Journey says
Great tips! One thing I have been thinking recently is about what level of income does it become appropriate to begin reporting it at tax time? 1K? 5K? Any thoughts?
The IRS, and the law, want you to start reporting when you earn anything. Even if you don’t receive a 1099. So when you earn your first $1 you start reporting.
Jaymus (RealizedReturns) says
Great post. Good reminder for a guy like me at the early stages of a new blog.
One of the main reasons I created a blog in the first place was to use it for tax deduction purposes 🙂
In Canada before 2011 February, you can claim 100% of the cost of your computer/lap top for business use. I got my Apple MacBookPro for $400 off because of this (come tax refund time)
I make money from Google AdSense on my Blog and on my website. I have done my computations on my monthly cost of hosting, domain name renewals and the breakdown for internet access and use costs. (very low by the way) HOWEVER I have no content for Blogging without GOING and DOING. Obviously I have a fishing site and I got fishing then I blog about it and my site generates about 10,000 hits a month on average. BUT only because I go fishing and publish my fishing reports. To cut the story off right here. Can I deduct my Fishing Expenses. (Bait, Lures, Mileage etc…..) just curious and I think the answer is yes. And I realize I may need to contact a professional.
Is fishing a hobby that you blog about, or do you own a fishing business and just blog about it on the side? Another way to think about it is: Do you incur your fishing expenses BECAUSE of your blogging efforts? If the answer is no, then fishing is just a hobby, and being a website owner is unrelated.
Of course, that is just going off of what you wrote above, be sure to consult with someone and go through the finer details with them.
Thanks for the response. It is just a Hobby that I blog about. So probably won’t attempt a deduction on those expenses. I will stick with my Hosting, renewal and Internet useage. Thanks again. I think that puts it in a better perspective for me.
The Wordsmiths says
My question is similar to the fishing one above: my wife runs a personal fashion, food and design blog aimed at newlyweds; she often goes to meetings and events related to such endeavors. Now, this is an interest to her, but if she did not have the blog, she would not necessarily go to all the events.
1. I will definitely begin keeping tabs on the utilities in our home for this purpose (she uses approx. 3% of our home for this routinely), along with the mortgage and insurance costs. We also have a home security system – does this also fall under the 3% used rule?
2. She has purchased a new camera for use in displaying what we do in the blog (from filming videos about cooking to vlogs about making your own scarves, etc.) so can I include that as a deduction?
3. Is there a standard protocol or program for figuring out the percentage of broadband used from a certain computer? Her laptop at home is used exclusively for blogging, so any traffic from her IP address for example would all be blog related.
4. Are these all deductions, or can any of them count to our refund? We both did maximum withholding in the last year to get our “biggest refund” but I am rapidly finding out from blogs like this and others that max withholding is just an interest-free loan to the government and not the best way to grow your money long-term. Of course, perhaps it’s different if she’s filing for these on her own, but we usually file our taxes together.
5. The comment from Miranda about us reporting all gains. Most of her gains come in swag (such as a new dress from a fashion shoot, perfume for a giveaway, etc.) How are these items tabulated?
If nothing else, these tips will help in ’11! Much thanks in advance for my many questions.
Oh my! I suggest you ask a tax professional for help on a lot of those questions. I take a percentage of the broadband used in our home. I don’t know about security systems, but make sure that, when you take anything, the portion you are counting is EXCLUSIVELY for business. Often, when you get a property windfall, it is tabulated according to market value. Most of what you’re talking about are deductions, so they only work to reduce your taxable income. I’d check with a tax professional in any case. I can tell you that my yearly visit to the accountant to have my taxes prepared is well worth the cost.
Nicole Couloute says
This is a very informative post on tax deductions for bloggers. This post will be very useful this tax season. Thanks!
Great tips for this time of the year! Thanks!
Glen Craig says
The IRS has been getting very strict in requiring proof of charitable deductions in recent years. You must have a credit card statement or a written other written statement from the charity, showing the name of the charity and the date and amount of the contribution for all cash donations. This can also include a cancelled check or a bank statement.If you donate clothing or household items, they must be in good used condition or better to be deductible.
Also, if you charge a charitable donation to your credit card on or before December 31 and don’t pay the bill until 2012 you are qualified for the tax relief.
Wow this is very helpful!
Here is a free tool to help with tax prep:
Question – in order to deduct your home as a business expense, how “exclusively” does the space have to be used for blogging?
For example, I have my home office set up in my spare bedroom in my condo, which takes up maybe 1/5 of the total space. However, I also have other things in the room – bikes, Christmas ornaments, wine storage, an ironing board, and a spare bed that never gets used.
Would the whole bedroom where my desk is qualify or not you think, since it’s primary use is my office, but not exclusively?
Just the area around your desk qualifies. The whole room is not being used for your blogging business purposes. So you figure out the square footage of 1/5 of that room. For example, my desk and printer stand take up an area that is about 5×6 feet, inside a room that is about 12×12 feet and used as storage. So, it takes up 30 square feet. If my home is 1,700 square feet, it takes up 1.7% of my home. So I can deduct 1.7% of my mortgage and utility payments. In my case, that would amount to a deduction of right around $316.
Jacob @ My Personal Finance Journey says
Thanks so much for the guidance Miranda! Much appreciated!
Jimmy Jean says
I have a 80K loss in a golf lot that went broke. The builder then made us investors and we receive a K-1 form as a loss on the golf coarse and development value every year. Is this a loss? Thx JJ
my office probably takes up close to 10% of my home. Kaching!
Monthly memberships at social media websites that auto tweet content is also deductible as an advertising expense if that membership is used to promote a business blog.
If your Adjusted Gross Income or AGI is below the maximum threshold you may also be able to claim the Earned Income Credit. Although this is not a deduction, but rather a credit, it should help to lower your tax bill significantly if you qualify for it, and you don’t necessarily have dependents to do so.
Mike Collins says
It’s really important to keep track of all your business expenses and tax deductions throughout the year. If you wait until the last minute you’ll be scrambling around and likely to forget something.
Martha Gonzales says
Miranda, this blog can’t be better timed than this. Thanks a ton for this blog post and when I say this I really mean it from the core of my heart. I’m a dedicated blogger for the last 4 years and still I was not aware of the tax deductions meant for bloggers. In fact, I’m surprised to know that I can get deduction on tax by showing some of the dedicated articles I use for blogging (almost all the items you have mentioned here). Thanks again.
Megan Harvison says
Great article! I am finally earning a blog income that requires me to start looking at taxes. It makes me super excited and depressed! Lol I make around $240/month now. Time for tax deductions!
I just tried to subscribe to your blog but it says page not found!
Great article! Thanks for sharing!
What if you have a full time job and your blog is your second job? Is it messy to take all the deductions for the business against your full time job salary? I’m thinking especially in the beginning where you may make zero income from the blog, yet have a decent amount of deductions.
I think you answered above with the fashion blog question, but what if your blog includes cooking – can you deduct the ingredients for making that dish? What about equipment? If I buy a new oven, do I get to deduct part of the expense because I use it for my blog?
You have to file a separate Schedule C for the blog income/loss (assuming you haven’t created a separate business entity). The loss on there will offset the taxes you have to pay from your full-time job.
The oven is a much thornier issue, but I would doubt that you could deduct that unless you had a separate kitchen that was just used for the blogging. But, certainly an accountant could be more definitive on that.
alicia parker says
donorchoose.org is a great website …you donate they send you a receipt and you get to use it as a tax write off …plus you get to help classes like ours….
IF YOU DONATE USE THE CODE “SPARK” IN THE PROMO CODE AT CHECKOUT AND A COMPANY WILL MATCH YOUR DONATION on this project!!!
Jason B says
Great post. This will come in handy for me next year.
Glen Craig says
Great to hear it will help!
Beth Demunbrun says
I just started blogging and didn’t even think about this!! I’m a theatre artist, so I should have. I’ve been keeping EVERYTHING from my latest contract work. Thank god all of my reciepts from blogging are in my email. Thank you so much for this post!! I’ll have to make sure to keep track of things!
Could you still use it as a tax write off even if you haven’t made any money from it?