What Business Expenses Can Influencers Write Off?

Navigating the financial landscape as a self-employed individual, particularly for those in the evolving field of influencing, involves understanding various tax considerations. Income generated from content creation, brand partnerships, and other related activities is subject to taxation. The Internal Revenue Service (IRS) allows self-employed individuals to reduce their taxable income by deducting legitimate business expenses. This ability to write off costs directly related to operating an influencer business can significantly impact overall tax liability. Properly identifying and documenting these expenses is important for financial management.

General Principles of Deductible Business Expenses

For an expense to be deductible, it must meet specific IRS criteria, primarily the “ordinary and necessary” rule. An ordinary expense is common and accepted in the specific industry or trade. For an influencer, this means costs typical for content creation, marketing, and business operations within that field.

A necessary expense is helpful and appropriate for the business. It does not need to be indispensable. The expense must be directly related to the business activity and incurred in pursuit of income. It is important to distinguish business expenses from personal expenses, as personal costs are generally not deductible, even if they have some tangential connection to one’s work.

Common Deductible Expenses for Influencers

Influencers incur various costs to operate their businesses, many of which are deductible if they meet the “ordinary and necessary” criteria. These expenses fall into several categories, each playing a role in reducing taxable income.

Content creation and production costs form a substantial portion of an influencer’s expenses. Equipment such as cameras, lighting, microphones, and computers are deductible, as are software subscriptions for editing and design. Costs for props, set decorations, music licenses, and stock photos or videos used in content production also qualify as business expenses. These items are directly used to create the products or services offered by the influencer.

Marketing and promotion expenses are deductible, encompassing costs to reach a wider audience and secure brand deals. This includes website hosting and design fees, paid social media advertisements, and public relations services. Branding expenses that help establish and promote the influencer’s professional image are also considered ordinary and necessary for business growth. These expenditures are directly aimed at expanding the business’s reach and revenue.

Professional services are another category of deductible expenses. Fees paid to agents or managers who help secure opportunities and manage careers are deductible. Costs for professional advice from accountants, tax preparers, and legal counsel related to business operations are also allowable deductions. These services support the structure and compliance of the business.

Travel expenses incurred for business purposes, such as attending conferences, events, or collaborating with brands, are deductible. This includes airfare, lodging, and local transportation costs. While traveling for business, 50% of meal expenses can be deducted, provided they are not lavish and have a clear business purpose.

Home office expenses can be deducted by influencers who use a portion of their home exclusively and regularly for their business. This means the space cannot be used for personal activities, even occasionally. There are two methods: the simplified option or the actual expenses method. The simplified option allows a deduction of $5 per square foot, up to a maximum of 300 square feet, resulting in a maximum deduction of $1,500.

The actual expenses method involves calculating the specific business portion of expenses like mortgage interest, rent, property taxes, utilities, insurance, and repairs. While more detailed record-keeping is required, it can sometimes lead to a larger deduction than the simplified option, especially for larger dedicated workspaces. The choice between methods can vary year by year, offering flexibility to maximize deductions.

Vehicle expenses for business use of a personal vehicle can also be deducted. Influencers can choose between the standard mileage rate or deducting actual expenses. The standard mileage rate, set annually by the IRS, is a simpler method that accounts for common vehicle-related costs like fuel, maintenance, and insurance. For 2025, the standard mileage rate is $0.70 per business mile driven.

Alternatively, the actual expense method allows for the deduction of specific costs such as gas, oil, repairs, insurance, and depreciation attributable to business use. This method requires detailed record-keeping of all vehicle-related expenses and a precise calculation of the business-use percentage. Parking fees and tolls incurred for business purposes are deductible under both methods.

Utilities and communication expenses, such as internet and cell phone bills, are partially deductible if used for business purposes. Only the portion attributable to business use can be claimed, requiring an allocation between personal and business usage. Keeping track of business-related calls and online activity can help substantiate this deduction.

Education and training costs directly related to improving influencer skills or business knowledge are deductible. This includes courses, workshops, or seminars on topics like photography, video editing, or digital marketing. These expenses must enhance existing skills or knowledge in the influencer’s current business, not qualify them for a new trade or business.

Business insurance premiums, such as general liability insurance, equipment coverage, or professional liability insurance, are deductible expenses. Premiums for health insurance may also be deductible for self-employed individuals, subject to specific rules.

Bank fees associated with business accounts or payment processing fees from platforms are deductible. These are direct costs of managing business finances and receiving income.

Maintaining Proper Records and Documentation

Maintaining accurate and thorough records for all business expenses is a requirement for self-employed individuals. This practice is important for substantiating deductions in the event of an IRS audit. Without proper documentation, even legitimate business expenses may be disallowed, potentially leading to increased tax liability, penalties, and interest.

Key documents to retain include receipts, invoices, canceled checks, and bank or credit card statements. For expenses like vehicle use, detailed mileage logs are essential, recording the date, mileage, and business purpose of each trip. For home office deductions, records supporting the exclusive and regular use of the space are necessary.

Records should contain specific information for each expense, including the date, amount paid, payee, and the business purpose. Digital methods, such as scanning receipts and using cloud storage or accounting software, are acceptable and can simplify organization. Consistency in record-keeping methods is beneficial for efficient financial management.

The IRS generally advises keeping tax records for at least three years from the date the original return was filed. However, certain situations necessitate longer retention periods. If gross income is underreported by more than 25%, records should be kept for six years. Records related to bad debt deductions or worthless securities claims should be kept for seven years. In cases of suspected fraud or unfiled returns, records may need to be kept indefinitely.