When is a business expense a tax deduction?

November 28th, 2011 → 2:00 pm @ // No Comments

I’ve been “eating my losses” from writing (i.e. not claiming them on my tax return). I need a new PC. Is it a business deduction?

Yes! A computer is a necessary (meaning helpful and appropriate) and ordinary expense for a writer.

The IRS explains what makes a business expense a tax deduction:

“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.

An expense does not have to be indispensable to be considered necessary.

So buy yourself a new computer and get writing!


Carol Topp, CPA

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