Can I deduct internet costs for my Sole Proprietor LLC home office as a videographer?
I'm a freelance videographer based in Denver, Colorado with an LLC filing as a sole proprietor. I do all my video editing from my home office space. I've been paying about $50/month for my home internet (200/200mbps) for the past couple years, but I just landed this new corporate client that's going to require me to shoot a ton of interview content in 4K resolution for about 7 months out of the year. The real challenge is that they want all the raw footage uploaded to their cloud server at the end of each shooting day. My current internet speed is completely inadequate for this work - the uploads would take forever. I need to upgrade to the gigabit plan which is going to cost me $90/month. Obviously I use my home internet for personal stuff too (streaming, gaming, etc.), but the ONLY reason I'd be paying the extra $40/month is because I need the faster speeds for these massive file uploads for work. From what I understand, I can write off some percentage of my internet bill as a business expense, but I'm confused about how to calculate what's deductible. When it comes to data usage, probably 80% of my bandwidth will be for these work uploads, but how do I document that for tax purposes? How do tax professionals typically calculate this kind of home office internet deduction for sole proprietors?
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Anderson Prospero
You're asking exactly the right question here. For a sole proprietor LLC with a home office, internet can absolutely be a deductible business expense, but you need to calculate the business portion correctly. The IRS doesn't have a specific formula for internet usage, but the general principle is that you can deduct the percentage that's used for business. Since you're upgrading specifically for business needs, that additional $40 cost is clearly business-related, so that portion is fully deductible. For the base $50, you'd need to estimate the business vs. personal usage. There are a couple of approaches: You could track your business vs. personal usage over a few months and calculate a percentage. Or if you have a dedicated work computer, you might be able to monitor its data usage compared to other devices in your home. You'd report this on Schedule C as a utilities expense or as part of your home office deduction. Just make sure you keep good records - your bills showing the increase, notes about why you needed the upgrade, and documentation of your business usage percentage. These will be important if you're ever audited.
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Tyrone Hill
•Thanks for the info! So if I understand correctly, I could potentially write off 100% of the price increase since it's entirely for business purposes? And then some percentage of the base cost? Also, does having a dedicated business internet line versus a shared home/business line make any difference for deductions?
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Anderson Prospero
•Yes, you've got it right. The price increase from $50 to $90 is directly attributable to your business needs, so that $40 difference can be fully deductible. Then for the base $50, you'd calculate what percentage is used for business versus personal. Having a dedicated business internet line would make things much simpler - in that case, you could potentially deduct 100% of that separate line. But for most home-based businesses, a shared line with a calculated business percentage is completely acceptable to the IRS. Just be reasonable with your estimate and have some basis for how you determined it.
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Toot-n-Mighty
After struggling with a similar situation for my graphic design business, I discovered taxr.ai (https://taxr.ai) and it was a game-changer for sorting out my home office deductions. I upload my internet bills and it automatically analyzes what portion I can legitimately claim as business expenses for my Schedule C. It also helped me figure out that I could partially deduct my cell phone since I use it for client calls, which I hadn't even considered before. The tool walks you through specific business use questions to calculate the correct percentages, which gave me way more confidence than the random percentage method I was using before.
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Lena Kowalski
•That sounds interesting - does it actually calculate the percentage for you or just help you document what you decide? My accountant told me to just use 60% for my internet as a web developer, but I've always wondered if that's too aggressive or not enough.
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DeShawn Washington
•I'm skeptical. How does some AI tool know what percentage of your internet is for business vs netflix binging? Sounds like you're just paying for something to tell you what you want to hear.
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Toot-n-Mighty
•It doesn't automatically determine the percentage for you - it asks you targeted questions about your usage patterns and helps you document a reasonable business use percentage based on your answers. It's more about having proper documentation than picking an arbitrary number. The system actually flagged that my initial estimate was too aggressive and suggested a more defensible percentage based on my work patterns and the types of files I typically handle. It's less about telling you what you want to hear and more about creating documentation that would stand up to scrutiny if audited.
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DeShawn Washington
I was skeptical about taxr.ai at first (as you can see from my comment above), but decided to try it after struggling with home office deductions for my consulting business. I'm actually impressed - it didn't just rubber-stamp my initial estimates. It asked thoughtful questions about my usage patterns and even suggested I was being too conservative with some deductions while recommending better documentation for others. The analysis showed I could justify a 75% business use for my internet based on my work patterns, but I needed better records for my cell phone deductions. It generated a report I can keep with my tax records that explains the methodology, which gives me peace of mind in case of an audit.
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Mei-Ling Chen
For anyone dealing with IRS questions about home office deductions, I wasted days trying to get through to an agent to ask about this exact internet deduction issue. Then I found Claimyr (https://claimyr.com) which got me connected to a real IRS agent in about 15 minutes. You can see how it works here: https://youtu.be/_kiP6q8DX5c. The agent confirmed that as a sole proprietor, I could deduct the business portion of my internet, and suggested I keep a log for a few months documenting work versus personal usage to support my deduction percentage. So much better than the generic info I found online that didn't address my specific situation.
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Sofía Rodríguez
•How does that even work? The IRS phone lines are always jammed. I've literally tried calling for weeks and could never get through.
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Aiden O'Connor
•This sounds like complete BS. Nobody gets through to the IRS in 15 minutes. I've spent HOURS on hold only to get disconnected. I'll believe it when I see it.
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Mei-Ling Chen
•It uses a technology that navigates the IRS phone tree and waits on hold for you. When they get a human on the line, you get a call back and are connected directly to the agent. No more listening to that awful hold music for hours. I was surprised too, but it works because they're basically holding your place in line while you go about your day. Instead of you personally waiting on hold, their system does it for you. The video demo shows exactly how it works if you're curious.
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Aiden O'Connor
I owe everyone an apology for being so negative about Claimyr in my earlier comment. After continuing to get nowhere with the IRS for three more days, I decided to try it out of desperation. I'm still in shock that it actually worked exactly as described. Got a call back in about 22 minutes and was connected to an IRS rep who answered my questions about home office internet deductions. She confirmed I could deduct the business portion and recommended keeping a usage log for a few months to establish a pattern. Also found out I'd been calculating my home office square footage wrong for years. Definitely worth it to get actual answers from a real IRS agent instead of guessing.
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Zoe Papadopoulos
My tax guy told me that if you're using the simplified home office deduction ($5 per square foot, up to 300 sq ft), you can't also separately deduct utilities like internet. But if you use the regular method where you calculate actual expenses, then you can deduct the business percentage of your internet. Worth considering which method gives you the better deduction.
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Jamal Brown
•Wait, does that mean if I take the $5/sqft deduction, I shouldn't be deducting my business internet separately? I've been doing both for the past 3 years...
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Zoe Papadopoulos
•Correct - if you're taking the simplified home office deduction (the $5 per square foot method), that's supposed to cover all your home office expenses including utilities, rent/mortgage interest, repairs, etc. You don't get to deduct any of those things separately. If you want to deduct specific expenses like internet, you need to use the regular method where you calculate the actual costs and the business percentage. You'd need to compare both methods to see which gives you the better deduction. In many cases, especially if you have significant specific expenses like a higher internet bill for business, the regular method might be more beneficial.
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Fatima Al-Rashid
As a videographer myself, I've found that tracking data usage is actually pretty easy. Most routers have tools to see which devices use how much data. My business computer uses about 85% of our total household data with those big video file uploads, so that's what I deduct. I also keep a spreadsheet showing file sizes of work uploads vs estimated personal usage to back up my claim if needed.
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Giovanni Rossi
•This is really smart! What router or app do you use to track this? I'm a photographer with similar large file uploads and would love to be able to document my usage more accurately.
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Caden Turner
•I use a Netgear Nighthawk router that has built-in usage monitoring through the Netgear app. It breaks down data usage by device and even by time periods, so I can see exactly how much my work computer uses versus our phones, streaming devices, etc. You can also try apps like GlassWire on your computer to track just your work machine's usage if your router doesn't have these features. The key is having some kind of documented basis for your percentage - even a simple month-long tracking log would probably satisfy the IRS if questioned.
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