You Be the Tax Judge: The Verdict on Influencer Celebrity Expenses

The votes are in. You overwhelmingly—74%—chose:

(C): Some of them could be. Whether an expense is deductible should depend on the particular experience and its connection to the influencer business.

Now, what did the Tax Court say?

In Sami v. Commissioner, T.C. Memo. 2026-69, Judge Elizabeth Copeland agreed with you (mostly) and ruled that Suleiman Sami could not deduct the costs of attending the Grammys and Emmys, meeting celebrities, and participating in other exclusive experiences as ordinary and necessary business expenses.

But the court didn’t hold that influencers can never deduct expensive—or even fun—experiences as business expenses.

Instead, the decision came down largely to something much more familiar in tax law: Why did the taxpayer really spend the money?

Business Or Pleasure?

Section 162 generally allows taxpayers to deduct ordinary and necessary expenses paid or incurred in carrying on a trade or business. However, an expense that provides some benefit to a business isn’t automatically deductible. This is especially important when an expense has both personal and business elements (which, let’s face it, is often the case when you are self-employed).

Sami argued that the celebrity experiences were marketing expenses. He testified that he attended events and met celebrities to create content, attract followers, and increase engagement on his social media accounts. There was evidence that the strategy worked—at least in terms of attention. For example, after Sami posted a photo with actor Tom Holland, he saw increased engagement and inquiries from people wanting to know how to meet Holland or Zendaya.

The court also acknowledged that Sami posted photos and videos from his celebrity encounters, and that those posts may have increased his followers and views. But that wasn’t enough.

The question wasn’t simply whether Sami’s experiences produced content or benefited his social media presence. The court looked at his primary motivation for incurring the expenses. In this case, Judge Copeland concluded that Sami’s reasons were primarily personal rather than business-related.

Posting About It Doesn’t Make It A Business Expense

That’s an important distinction for influencers and, increasingly, for anyone who creates content as part of a business.

The court offered a useful hypothetical. Imagine a comedian who takes a European vacation and returns with terrific material for her act. The fact that the trip ultimately yields useful material doesn’t make the vacation a deductible business expense.

The same principle applies here.

Sami pointed out that he even posted about the experiences that didn’t make him look particularly impressive. For example, he shared a video of himself dropping a pass from Tom Brady and another video of his unsuccessful attempt to return a John McEnroe serve. He argued that his willingness to post embarrassing moments supported his claim that he was creating content rather than simply pursuing personal experiences.

The court wasn’t convinced. Those experiences could still provide Sami with personal enjoyment, stories to tell, and the prestige of meeting famous people, even if the resulting content also attracted viewers.

And Then There Were The Facts You Didn’t Know

When I asked you to be the Tax Judge, I deliberately omitted a few facts. Here’s a big one: Sami originally claimed many of these expenses as charitable contributions. Some celebrity experiences were offered through charities. Sami initially treated payments for those experiences as charitable contributions on Schedule A. By the time the case reached the Tax Court, however, he had abandoned that argument and was claiming them as Schedule C marketing expenses.

That change didn’t help his case.

Another significant fact: although Sami described social media influencing as one component of his business, he earned no gross receipts from it in 2019, 2020, or 2021, the tax years before the court. Most, if not all, of his LLC’s revenue during those years came from providing transportation services, with possibly a small amount from selling event tickets.

(Many of you pegged this issue as a key question in your social media responses.)

By October 2025, Sami had amassed approximately 520,000 TikTok followers and 140,000 Instagram followers, and he was earning social-media revenue. But the court had to decide the tax treatment of expenses incurred years earlier.

Could They Have Been Startup Costs?

The court didn’t simply say, “No influencer income, no deduction.”

Judge Copeland considered another possibility. If Sami incurred the expenses while trying to establish a social-media business that had not yet begun operating, the court suggested that they were more likely startup expenditures that would have to be capitalized under section 195, rather than currently deductible business expenses under section 162.

Section 162 applies to expenses incurred in carrying on an existing trade or business. Expenses incurred before the business actually begins may fall under the startup-cost rules instead.

But that argument required considerably more legal analysis than Sami presented, and the court declined to do it for him.

Receipts Matter, Too

There was one more problem: substantiation. If you’re a regular reader, you’re not surprised. I regularly stress keeping excellent records. That didn’t happen here.

For many of the claimed expenses, Sami produced credit card or bank statements rather than receipts that clearly showed what he purchased and how it related to his business.

One example was a $1,661.57 Ticketmaster charge that Sami identified as a marketing expense. There was no receipt identifying the event, no other evidence explaining what the charge covered, and no evidence of a social media post associated with it. Other records contained little more than PayPal usernames and transaction numbers. That wasn’t enough to substantiate the deductions.

To be clear, you don’t necessarily need an original receipt to substantiate every business expense. A credit card or bank statement can help establish that you spent the money, but that may not be enough by itself. Your records also need to establish what you purchased and its connection to your business—I recommend annotating it contemporaneously where possible.

In this case, the recordkeeping issue was especially notable because Sami holds both bachelor’s and master’s degrees in accounting and previously worked in risk assurance at PwC. The court later cited his accounting background when rejecting his reasonable-cause defense to the accuracy-related penalties.

Counsel Weighs In

Frank Agostino of Kostelanetz LLP, who represented Sami, agrees that “the Tax Code demands contemporaneous documentation of business purpose, business strategy, and the connection between expenses and revenue.”

Agostino disagreed with the court’s finding that Sami’s enjoyment of the experiences was a primary motivation. “So what?” Agostino counters. “The Tax Code doesn’t require that a business activity be unpleasant to be deductible. A trial lawyer enjoys staying at nice hotels during depositions; a consultant enjoys first-class flights.” Agostino argues that the relevant standard is whether there’s a genuine expectation of profit and, importantly, the realistic potential to generate it.

“In creator economy businesses,” he explains, “there is no separation between building audience and producing revenue. Content creation is the product. Sami didn’t buy experiences to enjoy them personally, then later monetize; he bought them to create content that monetized. Every story, every post, every experience documented contributed to audience growth.” The engagement itself was the currency.

Agostino adds, “The next creator who maintains proper records, who documents business strategy, who ties expenses to business goals in real time, will win.”

What The Case Does—and Doesn’t—Say

The case does not stand for the proposition that influencers can’t deduct unusual experiences, event tickets, or other costs associated with creating content.

Nor did the Tax Court create a special set of deduction rules for influencers. To the contrary, the court noted that this was its first opportunity to apply these general principles to social-media-influencer expenses. The same tax rules that apply to other businesses apply to creators, too.

An influencer doesn’t lose a deduction merely because an expense looks like fun. But posting about something doesn’t magically transform a personal expense into a business expense.

The taxpayer still has to establish the connection between the expense and an existing trade or business, show that the expenditure was primarily business-motivated when personal considerations are involved, and keep records sufficient to substantiate the deduction.

The ruling: Sami lost on the celebrity-experience deductions. But the decision leaves room for something considerably more interesting than a simple yes-or-no: under the right facts, a creator could have a legitimate business deduction for an experience that looks an awful lot like fun.