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Do you claim domain names and hosting expenses on taxes?

by guitarjosh
8 replies
Hi guys.. Since this next tax year is going to be my first year at making a decent extra income online, I'm curious as to what you can claim on taxes?

My online profits are just my spending money (not my real job) so I don't have a registered business, but since my AdSense income will likely be over $30,000 for the year, and the taxes on that are going to be plenty, can I claim all my domain names and web hosting expenses? Any other tax tips?
Thanks!
#claim #domain #expenses #hosting #names #taxes
  • Profile picture of the author GuruGazette
    Yep. Domain Names, hosting, internet services, business books and courses, office supplies, outsourcing costs. The list is long.

    I'm not an accountant so you need to consult with one or take a crash course in trying to do it yourself.
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  • Profile picture of the author EconomicalDomains
    Absolutely! They are business expenses so you can definitely deduct them from your taxes. You can also write off part of your mortgage, gas, food for meetings and business, travel etc.
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    • Profile picture of the author Michael Oksa
      Originally Posted by EconomicalDomains View Post

      Absolutely! They are business expenses so you can definitely deduct them from your taxes. You can also write off part of your mortgage, gas, food for meetings and business, travel etc.
      That is NOT always true.

      You can only write SOME of them off IF they are used EXCLUSIVELY for business purposes. For example, you can't write off a part of your mortgage if you don't have a dedicated office area that is used exclusively for business. So, if your office doubles as the family room, you most likely CANNOT deduct it.

      Gas, food and travel deductions ONLY if they are for your business, and then ONLY the part that is done for business. For example, if you go to Orlando for a 1 day business meeting, and then stay for 3 more days so you can go to Disney World, ONLY the 1 day is covered (and then only the parts that are directly related to your business).

      Hosting and domains are usually deductable, but your internet connection may or may not be; depending on whether or not it's used EXCLUSIVELY for business puproses (such as a separate business-only connection).

      That being said, be careful before you claim anything, and double check with someone who is QUALIFIED to give such advice. Not somebody in a forum (including me).

      All the best,
      Michael
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      • Profile picture of the author fluffythewondercat
        Originally Posted by Michael Oksa View Post

        You can only write SOME of them off IF they are used EXCLUSIVELY for business purposes. For example, you can't write off a part of your mortgage if you don't have a dedicated office area that is used exclusively for business. So, if your office doubles as the family room, you most likely CANNOT deduct it.
        Well... My home office is one end of the family room and that space is never used for anything else (if you saw it you'd know why :-) ). As part of the paperwork required for the home office deduction, I have to specify the exact area which is used for business. It doesn't have to be a separate room with walls and a door.

        And yes, of course, I deduct hosting expenses, domains, internet access, and a ton of other things, even a portion of the utilities. TurboTax is your friend here.

        fLufF
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        • Profile picture of the author Michael Oksa
          Originally Posted by fluffythewondercat View Post

          Well... My home office is one end of the family room and that space is never used for anything else (if you saw it you'd know why :-) ). As part of the paperwork required for the home office deduction, I have to specify the exact area which is used for business. It doesn't have to be a separate room with walls and a door.

          And yes, of course, I deduct hosting expenses, domains, internet access, and a ton of other things, even a portion of the utilities. TurboTax is your friend here.

          fLufF
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          Hi fLufF,

          That is correct, and also why I used the word 'area' instead of 'room'. However, I appreciate you clarifying that for people because there are a lot of misconceptions about claiming income and expenses.

          (Don't even get me started on 1099-MISCs )

          All the best,
          Michael
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  • Profile picture of the author gmc193
    Originally Posted by guitarjosh View Post

    Hi guys.. Since this next tax year is going to be my first year at making a decent extra income online, I'm curious as to what you can claim on taxes?

    My online profits are just my spending money (not my real job) so I don't have a registered business, but since my AdSense income will likely be over $30,000 for the year, and the taxes on that are going to be plenty, can I claim all my domain names and web hosting expenses? Any other tax tips?
    Thanks!
    I throw all expenses I can think of into the mix and leave it to my accountant after that.

    It's important that you claim for everything, especially as you have a J.O.B.

    If you get a good knowledgable accountant, you can save more than they cost.
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    Broon Dog Internet Marketing
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  • Profile picture of the author guitarjosh
    Sweet! Great news to hear. I just wasn't sure if I could with it simply being 'other income' as opposed to 'business income', but the news here sounds great.

    Thanks!
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  • Profile picture of the author timpears
    Any expense you have to generate the income is tax deductible, other than if you buy equipment or something like that. Equipment is deprecated. If you don't understand it, an accountant is the best bet. It won't cost that much compared to the $30K you earned from AdSense, and they will pay for themselves in savings on your taxes almost always.
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    Tim Pears

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