Is Internet Service Tax Deductible for Self-Employed? Yes — Here's How to Claim It
100%
Deductible
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.
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
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