Answers · Deductions, assets & depreciation
Business Expense vs. Personal Expense
Personal, living and family expenses are generally nondeductible unless a specific provision allows them.
How it works
The rule, and what it turns on.
Mixed-use items require a reasonable business-use allocation and entity payment does not turn personal consumption into a deduction.
Example
A phone used 70% for business may support a 70% business allocation when facts/documentation are reasonable.
Common mistakes
What we see go wrong, and what we do instead.
- Deducting 100% mixed-use costs.
A better approach
- Use written allocation policies for mixed-use items.
Authority
Where this comes from, so you can check it.
IRC §§162, 262.
Educational information, not individualized tax advice. Treatment depends on your facts, entity classification and tax year, and IRS instructions change. Confirm your own position with us before relying on it. Mint Associates does not provide legal services.
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