What's deductible?
- Hosting: Monthly or annual hosting fees (Bluehost, SiteGround, AWS, Vercel, etc.)
- Domains: Domain registration and renewal fees
- Design: Theme purchases, custom design work, logo design
- Development: Freelance developer costs, agency fees (see amortization note below)
- Content: Copywriting, photography, stock images for the site
- SEO: SEO tools (Ahrefs, SEMrush), SEO consulting services
- SSL certificates: Security certificates (often included in hosting)
- Plugins and tools: WordPress plugins, Shopify apps, analytics tools
- Email: Business email through your domain (Google Workspace, etc.)
- CDN: Cloudflare, AWS CloudFront, etc.
Ongoing costs vs. development costs
Ongoing costs (hosting, domains, plugins, maintenance) are fully deductible in the year you pay them. No special treatment needed.
Initial website development: If you hire a developer to build a custom website and the cost is significant ($10,000+), the IRS may treat it as a Section 197 intangible asset that must be amortized over 3 years. However, many tax professionals argue that a website is more like advertising (immediately deductible) than a capital asset.
For most small businesses spending under $10,000 on their website, expense everything immediately. Consult your CPA if you're spending significantly more.
Your annual website costs:
- Hosting (SiteGround): $180
- Domain renewal: $15
- WordPress theme: $59
- SEO tool (Ahrefs): $1,188
- Freelance content writer: $2,400
- Google Workspace email: $84
- Stock photos: $240
Total deductible: $4,166
Website expenses fall under IRS Publication 535 (Business Expenses). Hosting and ongoing costs: Schedule C, Line 18 (Office expenses) or Line 27a. Large development costs may fall under Section 197 amortization (IRS Publication 535, Chapter 8).
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