So What Kind Of Deductions Can I Take?

Here is a list of possible deductions you could take. Remember, you must not only have such ordinary and necessary expense, but be able to prove that you did. Think receipts, digital pictures or videos, mileage logs, etc.

• Domain Names
• Web-hosting Bills
• Advertising For Your Site (Adwords, Overture, etc.)
• Home-Office Deduction
  • Portion of rent or mortgage
  • Portion or all of internet access
  • Portion or all of telephone bill
  • Portion or all of other utilities
• Cellular Phone Bill (if used for business)
• Physical Equipment
  • Computer purchases
  • Other Computer Upgrades
  • Digital Cameras
  • Printers
  • Scanners
  • Fax Machines
  • Office Supplies
• Software for your business
• Business Mileage on your personal vehicle
• Magazine or Newsletter Subscriptions
• Books
• Post-Office Box Rental
• Tax-Preparation Expenses
• ... and more!

You would report all these deductions on your IRS Schedule C Form. The easiest way of doing this is to purchase the premium version of various tax software that does Schedule Cs, including TurboTax Premier and H&R Block TaxCut Premium. You don't have to buy the business versions, as Sole Proprietorships just include all business items on their personal tax returns.

Please consult a tax professional or other references to ensure your eligibility for these deductions. Many items must be used over 51% of the time to be deducted as a business expense. Other items must be depreciated over time. Proper software can also help you with these items.