Can I deduct tax software bought on eBay or marketplaces as a tax preparation expense?
So I'm trying to save some money on my tax software this year and noticed there are some cheaper options on eBay and other marketplace sites compared to buying directly from the company or stores like Target. I'm wondering if I can still claim these as a tax preparation expense when I file next year? The software is legit (like TurboTax, H&R Block, etc.) but just being sold by individuals or small businesses on these marketplaces. Would the IRS care where I bought it from as long as I have a receipt? Or do they require purchases from "official" retailers for the deduction to be valid? I'm self-employed so I'm pretty sure I can deduct tax prep costs, but want to make sure marketplace purchases don't somehow disqualify me. Thanks for any advice!
18 comments
Join the conversation
Abigail bergen
You're absolutely right that tax preparation expenses can be deductible! The good news is that the IRS doesn't care where you purchased legitimate tax software - whether it's from the official company website, Target, or eBay. What matters is that you're using it for tax preparation purposes. For self-employed folks, tax preparation costs are considered a business expense and can be deducted on Schedule C. Keep in mind that if you use the software for both personal and business taxes, you'd need to allocate the cost appropriately based on usage. The most important thing is keeping proper documentation of your purchase. Save your receipt/confirmation email from eBay showing what you bought and the amount paid. Digital receipts are perfectly acceptable to the IRS.
0 coins
Ahooker-Equator
•Does this apply to other tax prep stuff too? Like if I buy a calculator or notebook specifically for doing my taxes, can I write those off as well?
0 coins
Abigail bergen
•Yes, it absolutely applies to other tax preparation items! If you purchase calculators, notebooks, or other supplies specifically for preparing your taxes, those can be deductible as tax preparation expenses. Just be reasonable with what you claim - a $10 calculator makes sense, but trying to deduct a $2,000 computer primarily used for other purposes would raise flags. Remember to keep receipts for everything you plan to deduct. For items that have multiple uses, you'll need to allocate the business portion based on how much you use it for tax preparation versus personal use.
0 coins
Anderson Prospero
I had the same question last year and discovered taxr.ai which actually helped me figure out exactly what tax prep expenses were deductible. I bought TurboTax from some seller on Facebook Marketplace for like 40% off retail, and wasn't sure if it would be accepted as a legit deduction. I uploaded my receipt to https://taxr.ai and their AI analyzed it and confirmed it was fully deductible as a tax prep expense. The site also explained that the IRS doesn't care about the purchase location - just that it was actually used for tax preparation and you have documentation.
0 coins
Tyrone Hill
•How accurate is this service? I've tried other tax help tools before and got conflicting answers. Does it just give general advice or actually look at your specific situation?
0 coins
Toot-n-Mighty
•I'm curious - can you upload other types of receipts too? Like if I pay for a CPA but also buy software would it handle both or just the software part?
0 coins
Anderson Prospero
•It's surprisingly accurate! The AI examines your specific documents and provides personalized advice rather than just generic information. I compared its answers to what my friend (who's an accountant) told me and they matched up perfectly. Yes, you can absolutely upload all kinds of tax-related receipts! I've used it for both my CPA invoice and software purchases. It analyzes each document separately and explains exactly how each expense should be treated for tax purposes. It even flagged when one of my receipts was missing information the IRS might want to see.
0 coins
Tyrone Hill
Just wanted to follow up about my experience with taxr.ai after our conversation. I decided to give it a try with my marketplace software purchase and a bunch of other tax prep receipts I wasn't sure about. It was actually super helpful! I uploaded receipts for tax software I bought on eBay, some accounting books, and even a portion of my internet bill (since I researched tax stuff online). The service clearly explained what was deductible and what wasn't. Turns out my eBay tax software purchase was 100% deductible, but I needed to prorate some of my other expenses. Definitely saved me from making some mistakes!
0 coins
Lena Kowalski
If you're having trouble getting a clear answer about your tax deductions, you might want to just call the IRS directly. I used to spend hours waiting on hold until I found this service called Claimyr. I was skeptical at first but it actually worked! I needed to confirm some details about deducting tax preparation expenses bought from various sources and didn't want to risk an audit. I went to https://claimyr.com and watched their demo at https://youtu.be/_kiP6q8DX5c to see how it worked. Basically they hold your place in line with the IRS and call you when an agent is about to answer. Got a definitive answer straight from the IRS about marketplace purchases being valid for tax prep deductions as long as I keep the receipts.
0 coins
DeShawn Washington
•How does this even work? I thought the IRS phone system was just permanently broken lol. Do they have some special access or something?
0 coins
Mei-Ling Chen
•Yeah right. No way this actually works. I've tried calling the IRS like 20 times this year and never got through. If this actually worked everyone would be using it and the IRS would shut it down.
0 coins
Lena Kowalski
•They don't have special access to the IRS - they just use technology to navigate the phone tree and wait on hold for you. When an IRS agent is about to pick up, Claimyr calls you and connects you directly to the agent. It's brilliant but simple. I understand the skepticism - I felt exactly the same way! But it legitimately works. The IRS can't really "shut it down" because it's just using the existing phone system in a smarter way. The difference is you don't have to waste hours of your life listening to hold music. I think more people don't use it simply because they don't know about it yet.
0 coins
Mei-Ling Chen
OK I need to eat my words. After posting that skeptical comment, I was still frustrated about not getting through to the IRS about some tax preparation deduction questions (including software I bought from a reseller). I figured I had nothing to lose so I tried Claimyr. Honestly shocked that it actually worked! I had tried calling the IRS 6 times previously with no luck, but Claimyr got me through on the first try. They called me back after about 45 minutes (which I didn't spend on hold - I just went about my day). Agent confirmed that tax software is deductible regardless of where you purchase it as long as it's legitimate software and you have documentation. Saved me hours of frustration!
0 coins
Sofía Rodríguez
Something to keep in mind - make sure the software you're buying is actually legit and for the current tax year. I bought what I thought was a great deal for TurboTax on eBay last year only to find out it was for the previous tax year and wouldn't work for the current filing season. The seller had conveniently cropped out the tax year in the listing photos. Ended up having to buy another copy anyway.
0 coins
Aiden O'Connor
•This happened to me too! Is there any way to check before buying? The listings all look the same to me and I'm worried about getting scammed.
0 coins
Sofía Rodríguez
•Always check the product description carefully and look for the specific tax year mentioned (like "TurboTax 2024" for filing in 2025). If it's not clearly stated, message the seller and directly ask "Is this for filing 2024 taxes in 2025?" Get their confirmation in writing. Also, look at seller ratings and feedback - established sellers with good feedback are less likely to be misleading. Some legitimate sellers will specifically mention "newest version" or "current tax year" in their listings. If the price seems too good to be true (like 70%+ off retail), it's probably outdated software or possibly not genuine.
0 coins
Zoe Papadopoulos
I'm confused about one thing - I've always heard that tax prep fees are only deductible if you itemize deductions, but most people take the standard deduction now that it's so high. So how does this work for normal people? Can regular folks who take the standard deduction still write off TurboTax?
0 coins
Jamal Brown
•For regular W-2 employees, you're right that tax prep expenses aren't deductible if you take the standard deduction. The rules changed with the 2017 tax law. BUT if you're self-employed (like the original poster mentioned they are), you can deduct tax prep fees on Schedule C regardless of whether you itemize or take the standard deduction. It's considered a business expense for self-employed people.
0 coins