What creators can (and can't) write off

“It’s a write-off” might be the most misunderstood phrase in the creator world. A write-off isn’t free money. It lowers your taxable profit, which lowers your tax. Spend $100 on a deductible expense and you save the tax you would have paid on that $100, which is a fraction of it. You’re still out most of the $100.

That doesn’t make deductions small. Tracked properly over a year, they can add up to real savings. You just want to claim the right ones and skip the ones that get people in trouble.

Here’s how to tell the difference.

Quick note: this is general info, not tax advice. Deduction rules have lots of details and exceptions, so check anything big or unclear with a tax pro.

The rule behind every deduction: ordinary and necessary

To deduct a business expense, it generally has to be ordinary and necessary for your business. The IRS defines it like this: an ordinary expense is one that’s common and accepted in your trade or business, and a necessary expense is one that’s helpful and appropriate. It doesn’t have to be indispensable.

Two things follow from that:

1. It has to be for the business. Showing up in a video doesn’t turn a personal purchase into a business one.
2. You need to be able to prove it. A deduction you can’t back up with records is a deduction you might lose.

Common legit creator expenses

These often qualify when they’re used for your business:

• Gear: cameras, lenses, lights, microphones, tripods, backdrops, and a computer you use for work. Bigger purchases may need to be deducted over several years instead of all at once, so ask your tax pro how to handle anything expensive.
• Software and subscriptions: editing apps, design tools, scheduling tools, cloud storage, stock music and stock footage.
• Platform and payment fees taken out of your earnings.
• People you pay: editors, photographers, designers, a virtual assistant.
• Props and set pieces used only for content.
• Your website and email tools: domain, hosting, email list software.
• Advertising: paid promotion of your content or business.
• Professional help: a CPA, a lawyer reviewing a brand contract, trademark filing fees.
• Education related to your current business, like a course on video editing or pitching brands.
• Business travel, when the trip is primarily for business. A few posts from a vacation don’t make it a business trip.

Mixed-use items: figure your business-use percentage

A lot of creator stuff is part business, part personal. Your phone, your internet, your laptop, maybe your car. For these, you generally deduct only the business-use portion.

How to figure it:

1. Track a typical month. How much of your phone time, data, or mileage is business?
2. Pick a reasonable percentage based on that.
3. Write down how you got it and keep the notes.

Example: your phone bill is $80 a month and your tracking shows about 60% business use. You’d deduct around $48 a month, not the full $80.

For a car, keep a mileage log with the date, where you went, why, and the miles. The IRS standard mileage rate changes every year, so look up the current rate on IRS.gov instead of trusting last year’s number.

Home office basics

If you work from home, you might qualify for the home office deduction. The IRS home office rules generally require that:

• You use a specific part of your home regularly and exclusively for business, and
• It’s your principal place of business.

“Exclusively” is where most people get tripped up. A desk in your bedroom that’s also where you scroll at night, or a dining table you eat at, generally doesn’t count. A spare room or a clearly separate area used only for work can.

There are two ways to calculate it:

Simplified method. The IRS simplified option is $5 per square foot of home used for business, up to 300 square feet. That caps it at $1,500 a year. Minimal record-keeping, easy math.

Regular method. You figure the business percentage of your home (office square footage divided by total square footage) and apply it to actual expenses like rent or mortgage interest, utilities and insurance. It can be bigger, but it takes more records and more math, and it can have extra tax effects if you own your home. Renters can use it too.

If your setup is a 100-square-foot corner, the simplified method is usually the easy pick. If you have a big dedicated room and high rent, it may be worth running both.

The clothing rule (sorry)

This is the one that stings. Clothing is generally deductible only if it’s specifically required for your work and not suitable for everyday wear. A costume for a themed shoot? Possibly. A cute outfit you wore in a video and then to dinner? Generally not, even if you bought it for the video.

Hair, makeup, nails and skincare are usually treated as personal grooming too. There can be narrow cases, like special-effects makeup bought for one shoot, so ask a pro before deducting anything in this category.

Meals: the rules are narrower than you think

Business meals are generally limited to 50% of the cost, according to IRS Publication 463. To qualify, a meal generally needs a real business purpose (like a meeting with a client, collaborator or brand contact), can’t be lavish, and you need to be there.

What usually doesn’t count:

• Your own lunch while you edit at home
• Coffee runs by yourself
• Entertainment, like concert or game tickets, which is generally not deductible even with a client

Meals while you’re traveling overnight for business are generally deductible at 50% too. Meal rules have changed in recent years (there was a temporary 100% rule for restaurant meals that has ended), so check the current year’s publication before you file.

For every business meal, write down the date, place, amount, who you were with, and what business you discussed. A note on the receipt photo takes ten seconds.

Things creators wrongly deduct

• Everyday clothes and shoes, even ones that appear on camera
• Gym memberships, haircuts and general wellness stuff
• Personal streaming subscriptions you’d have anyway
• Vacations with a few posts sprinkled in
• 100% of your phone, internet or rent when you use them personally too
• Free products brands sent you. You can’t deduct something you didn’t pay for, and those products may count as income
• Groceries and everyday meals
• Parking tickets and tax penalties, which generally aren’t deductible

Keep records like you’ll be asked for them

For every expense, keep the receipt and a short note on what it was for. Also keep your mileage log, your business-use percentage notes, and your bank statements. The IRS lists the kinds of records to keep, and generally you want them for as long as they could matter for a return, which is usually at least three years and longer in some situations.

The easiest way to make this painless: run all business spending through a separate business account and card, and update your spreadsheet or bookkeeping app once a month. For the bigger picture on self-employment tax and 1099s, read creator taxes 101. And since deductions lower your profit, they lower your quarterly estimated taxes too.

Before you deduct it, ask yourself

• Is this common and helpful for a business like mine?
• Would I have bought this if I didn’t have a business?
• If it’s mixed-use, do I know my business percentage and how I got it?
• For a home office, is the space used regularly and only for work?
• For clothing, could I wear this in everyday life?
• For a meal, who was there and what business did we discuss?
• Do I have the receipt and a note?

If you can answer all of those cleanly, you’re probably in good shape. If you hesitate, that’s your cue to ask your tax pro.