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Deduct Your Phone and Internet Bills for a Smaller Tax Burden

dtran5 profile picture
February 21, 2017 · 2.2k Views

If you have a side hustle, are your own boss, or are involved in other tax situations, you may be eligible to deduct the costs of your cell phone and Internet services this tax season. However, make sure you understand the rules of these deductions so you avoid a conversation with the IRS.

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Do You Qualify to Write Off Your Phone & Internet Bills?

business smartphone

Source: tech.co

► Who can write them off?

If you use your smartphone or Internet service for business purposes and your employer (if you have one) does not reimburse you for these expenses, you can write off part or all of your phone and Internet bills. Some individuals who may qualify are Uber drivers, Doordash delivery drivers, babysitters, and more.


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► How much can you write off?

In the former section, it is stated that you can deduct part or all of your phone and Internet bills. The amount you can write off depends on the usage. If you have a dedicated business phone, you can write off all of the phone bill. If you have a smartphone you use for both business and personal reasons, then you can only deduct the percentage used for business. 

Moreover, it gets a tad more complicated if you have an employer and are claiming that your business expenses were not reimbursed. In this case, the total of your job expenses and particular deductions must be greater than 2% of your adjusted gross income. In layman's terms, you can only deduct what exceeds the 2%.

  • How to calculate the percentage used for business: Be reasonable. You maybe you using your phone for business and personal reasons, but don't try to count your phone call to grandma as part of your percentage towards deduction. If you share your plan with anyone else, deduct the costs of their lines. Note: it's better to underestimate; overestimating can lead to a call from the IRS. Always keep your receipts and keep track of your records.


How do you write them off?

Consider going to a professional to get your taxes done if this is the first time you're self-employed or have a side job - it can get a little complicated. We recommend using TurboTax or H&R Block to make things easier, and right now, we have an exclusive DealsPlus coupon that'll help you save 10% off your TurboTax Online services. We'll show you How to File Your Taxes Straight From Your Smartphone here.

If you want to give it a go, make sure you have these forms if you're...

  • Self-employed or an independent contractor: IRS Form 1040 and Schedule C or C-EZ for business and income costs. 
  • Individual: IRS Form 1040 and Schedule A will be used for itemized deductions.

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dtran5 profile picture
Daisy loves to write with humor and can be quite the sarcastic commentator when it is appropriate. Loves carbs, fashion, staying active, and pinning the latest DIY projects for her room (which she will actually never do).

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