Is Internet Service Tax Deductible for Self-Employed? Yes — Here's How to Claim It
100%
Deductible
of business-use portion
Line 25
Schedule C
Utilities
Category
$40–$100/mo
Typical cost
If you use the internet for your business—whether it's client communication, research, or online sales—you can deduct the business portion on your Schedule C taxes. For a dedicated business line or home internet used exclusively for work, you can claim 100% of the cost. If your internet is shared between personal and business use, you deduct only the percentage used for business purposes. Example: if your monthly bill is $80 and you estimate 70% business use, your annual deduction is $672.
Who qualifies?
Self-employed individuals, sole proprietors, and single-member LLCs filing Schedule C can deduct internet service costs. You must use the internet for business purposes—this includes freelancers, consultants, online sellers, and anyone running a business from home.
How to claim it
- 1 Determine your business-use percentage. If internet is 100% business, deduct the full amount. If mixed use, estimate the percentage used for work (e.g., 60% business, 40% personal).
- 2 Calculate your annual deduction: multiply your monthly bill by 12, then apply your business-use percentage.
- 3 Enter the deductible amount on Schedule C, Line 25 (Utilities) when filing your tax return, or include it in total utilities if filing electronically.
Pro tip
Keep a copy of your internet bill and document your business-use percentage in writing. If audited, the IRS wants to see that you can justify your allocation—a simple note like 'Used for client emails, video calls, and online invoicing: 70% business' can support your deduction and reduce audit risk.
Source: IRS Publication 535: Business Expenses · Updated for the 2025 tax year
Common questions
Can I deduct internet if I work from home?
Yes. If you work from home as a freelancer, sole proprietor, or single-member LLC, you can deduct the business-use portion of your home internet on Schedule C Line 25. You don't need a dedicated business line—just a reasonable, documented estimate of the percentage used for work.
How much of my internet bill can I deduct for my business?
You can deduct the percentage of your internet bill that goes toward business use. For example, if your monthly bill is $80 and you use the internet 70% for business, your monthly deduction is $56—or $672 for the year. If your internet is used exclusively for business, you can deduct 100% of the cost.
What is the home office internet deduction?
The home office internet deduction lets self-employed individuals and single-member LLCs write off the business-use portion of their internet service on Schedule C Line 25 (Utilities). It applies whether or not you claim the broader home office deduction—internet is its own separate expense.
Does IRS Publication 535 cover internet deductions?
Yes. IRS Publication 535 (Business Expenses) covers deductions for utilities including internet service. It confirms that the business-use portion of home internet is deductible for self-employed individuals. A dedicated business line is 100% deductible; shared personal/business internet is deductible at the business-use percentage.
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