What Tax Deductions Can You Claim for a Website?!

[VetTechJess]

I'm talking about in the case of stevepavlina.com. I am not sure whether or not steve has personal employees of his website other than himself and erin. (please by all means correct me if I am wrong...)

I was wondering exactly what tax deductions you could claim off a website? I dont think you could claim the typical deductions such as mileage and things...but still....please let me in on that.

I do know that you could claim home office and part of your utilities etc. as well as clothes you wore and perhaps even food that you eat....

Anyone have any advice on that??

[dmauder]

Originally Posted by VetTechJess

I'm talking about in the case of stevepavlina.com. I am not sure whether or not steve has personal employees of his website other than himself and erin. (please by all means correct me if I am wrong...)

I was wondering exactly what tax deductions you could claim off a website? I dont think you could claim the typical deductions such as mileage and things...but still....please let me in on that.

I do know that you could claim home office and part of your utilities etc. as well as clothes you wore and perhaps even food that you eat....

Anyone have any advice on that??

I'm just your typical "armchair accountant", but I do know a thing or two about taxes...

First of all, if your website is your business (or used to advertise a business), then you can write off any expenses you incur for the operation of that website/business. Hosting fees, website development, costs of website templates, portion of utilities as it would relate to a home office, etc.

Unless they changed the tax laws recently, I'm not sure how you would write off cost of clothes you wore or food you ate. Basically, you can't write off clothes unless it is a "uniform" required by your business and something you generally would not be able to wear in public.

As far as food, if you're taking clients out to eat and talking business, you can write that off. But you can't write off your grocery bill for just sitting at home in front of your computer and having a regular meal.

Dave

[1000feet]

There's typically two kinds of tax credits you can expect - expenses and incentives. For most businesses the government doesn't want to count expenses in your taxable revenue since overtaxing an unprofitable business would discourage a lot of people. Depending on the situation, for most business activity you can expect to pay tax on income minus the costs of things you need to run the business. Note that personal expenses have nothing to do with this. People with a regular job have to eat just as much as people who are self-employed so claiming that as an expense might be a good way to make new acquaintances in the tax auditing profession.

The other type of tax credit is for things that don't necessarily relate to income/expenses but the government wants to encourage - if they want to see more blogging-based businesses they'll start giving extra tax credits specifically for web hosting. I just don't see this ever happening anywhere.

Unless you're trying to do something the government really wants to make easier you can expect to pay full taxes on any profit you make. The advantages of online business are working against you in this case. If you want big tax deductions, you can always start a business where you have to spend $40K/year just to stay open. Don't feel too bad about it though - if you're paying a lot of tax it's because you're making a lot of money.

[Jim11]

this is Canadian tax law, but it would be similar.

first of all, to deduct any expenses, there must be a reasonable expectation of profit from the business. It can't just be a hobby

But if it is a legitimate business you can deduct all expenses that you can in any other business. ie: expenses that are incurred to generate income

the following are some of the typical expenses you would deduct:
- home office (portion of rent or mortgage interest, utils, phone/internet, etc)
- travel/auto relating to the business, including related deductions such as meals/entertainment
- advertising/promo
- accounting/legal
- asset depreciation (your computer equipment, etc)
- other random office expenses

etc


-

[MartialDev]

If you don't find an answer by searching for "bloggers' tax deductions", try searching for "writers' tax deductions" instead. HTH,