Ask The Taxgirl: Books As Business Expenses

Taxpayer asks:Hi Taxgirl,

I have a question about deducting books as business expenses. If I run, say a web development business, and I purchase both technical and business books, are the purchases tax deductible as business expenses?

I’ve searched and searched, but can’t seem to find anything.

Thanks for your advice.

Taxgirl says:

Absolutely!

To be deductible, a business expense must be both “ordinary and necessary.”

An ordinary expense is one that is common and accepted in your trade or business. A necessary expense is one that is helpful and appropriate for your trade or business.

As an attorney who works with a lot of folks in the web and software fields, I know that the technology is constantly changing. In order to keep on top of the information in the field, you have to stay educated. Knowing enough about the VAX system from 20+ years ago won’t keep you in business…

So, I think books related to keeping you up to date in your field qualify as ordinary and necessary – and thus, deductible.

Be careful, though, to make sure that there’s a clear connection between your purchases and your business. Just because “How to Make Friends and Influence People” may help you out doesn’t mean that it’s truly a business expense – but then, I’m not saying it’s not either 😉

You can read more on business expenses here.

(NOTE: As part of the TCJA, job-related expenses are no longer deductible on Schedule A. Business expenses remain deductible on Schedule C.)

Before you go: be sure to read my disclaimer. Remember, I’m a lawyer and we love disclaimers.
If you have a question, here’s how to Ask The Taxgirl.