Top 10 FAQs For Real Estate Agents – Can I Write Off My Phone and Internet

Andrea Dillon, CPA, CTRS Real Estate Professionals

Can I write off my phone and internet?

In today’s world, it is SO common for people to use their personal cell phones and home internet for many facets of their lives, including personal social scrolling, a virtual school for their kids, and running their business. Have a look at another post I wrote to see if you are eligible for a home office deduction. Logically, this leads us to another commonly missed expense on our real estate agent’s tax returns: Home internet and personal cell phone used for business.

If you read my blog (or listened to my podcast!) on home offices, you know you are only allowed to take a percentage of your home expenses for business since your home likely does double duty as your office, but also your personal haven and kids chaos center. Here’s my fun fact: I do not believe that home internet and cell phone use should be limited to your home office percent! So, if your office is 7% of your home, you take 7% of allowed home expenses as a write off, I never include home internet and personal cell phone in that. The reason? You likely use both of this WAY more than 7% for your real estate business!!!! Usually, that percent is much closer to 75-85%, actually. While, again, these are not large expenses, they are expenses you are likely entitled to (I have yet to meet an agent that does not use these in some capacity for business).

Now, tips of the trade… NEVER use 100%, unless you’ve got an entirely separate phone (for example) for your personal life. You can take your best, most reasonable estimate as to how much you use your phone for business vs. personal, typically it’s high on the business end in your world, but taking 100% is (a) risky and (b) not true. I suspect you at some point call your mother, your husband, your friends, etc. be realistic with this. Same for your internet, I know you book vacations (although who knows in today’s world), your kids surf youtube, etc. Take that into account and do not take 100%.

We often time see cell phones and the internet either left off on tax returns, or put on, but subject to the home office deduction (meaning less of a write-off. 75% > 7%). Definitely keep your eye on this, and when you are pulling your tax documents together, don’t forget to include this for your tax pro!