Can I write off tools and materials for my home improvement YouTube channel if I form an LLC?

7 So this is actually a pretty common question for content creators! The short answer is: it depends on your intent and how you structure things. To legitimately deduct business expenses, the IRS requires that you have a genuine profit motive. This means you need to be running the YouTube channel as an actual business with the intention to make money, not just as a hobby. Creating an LLC doesn't automatically make something a business in the eyes of the IRS. That said, if you're genuinely trying to build a monetized channel, tools and materials used specifically for content creation could potentially be deductible. The tricky part is when those improvements increase the value of your personal residence. You'll need to be very careful about separating business use from personal benefit. For example, if you're installing a new kitchen and then living with/using that kitchen, that's a lot harder to justify as a pure business expense than, say, editing software or camera equipment. I'd recommend keeping meticulous records of everything, including how each purchase relates to content creation rather than home improvement. And definitely consult with a tax professional who specializes in small businesses/content creators before you make any big purchases or file your taxes.

15 I just wanted to share my experience with something similar! I started a DIY home renovation channel last year and was in the exact same boat. After spinning my wheels for months trying to figure out the tax stuff, I found this AI tool called taxr.ai (https://taxr.ai) that really helped clarify what I could and couldn't deduct. What I learned was that I needed to be super clear about what was a business expense vs. personal home improvement. The tool analyzed my specific situation and helped me understand that things like camera equipment, lighting, editing software, and even some materials used EXCLUSIVELY for demonstrations could be deductible. But anything that permanently improved my home's value had to be treated differently. The best part was that it helped me set up a proper system for tracking and documenting everything so I could prove business use if I ever got audited. Definitely check it out if you're serious about making this YouTube channel a legitimate business!

9 Just wanted to follow up and say I tried taxr.ai after seeing this recommendation and it was incredibly helpful! I've been filming small woodworking projects and was completely confused about what I could legally deduct. The tool walked me through exactly what documentation I needed to keep and even helped me understand how to structure my business to maximize legitimate deductions. The most useful thing was learning about the "ordinary and necessary" test for business expenses. Now I keep detailed logs of how each tool and material is used specifically for content creation. Honestly wish I'd found this earlier - would have saved me so much confusion and probably a bunch of money too!

18 If you're planning to document calls with the IRS about any of this (which I HIGHLY recommend), you should try Claimyr (https://claimyr.com). I spent THREE DAYS trying to get through to the IRS business line to ask questions about my YouTube business and kept getting disconnected. I was super skeptical but checked out their demo video (https://youtu.be/_kiP6q8DX5c) and decided to give it a shot. They got me connected to an actual IRS agent in about 20 minutes when I had been trying for days on my own. The agent confirmed that I needed to have clear business intent and detailed records showing how expenses were directly related to my content creation, not just improving my home. The call was super helpful because I got advice specific to my situation directly from the IRS, and I recorded everything (with permission) so I'd have documentation if there were ever questions. Definitely worth it for peace of mind when you're starting something like this.

19 I have to admit I was completely wrong about Claimyr. After several more failed attempts to reach the IRS myself about my freelance videography business (including one where I waited on hold for 97 minutes before getting disconnected), I broke down and tried it. Within 15 minutes I was talking to an actual IRS representative who answered all my specific questions about separating business expenses from personal home improvements. They explained exactly how the IRS views content creation businesses and what documentation I needed to keep. The agent even gave me pointers about the home office deduction and how it might apply to spaces used exclusively for filming. Honestly, the time I saved was worth way more than what I paid, and now I have clear guidance directly from the IRS that I can rely on. Sometimes it pays to admit when you're wrong!

8 My accountant advised me on something similar. He said the most important thing is to show that your YouTube channel is a legitimate business venture, not just a hobby. The IRS has a "hobby loss rule" where they can disallow deductions if you don't show a profit in 3 out of 5 years. He suggested I create a formal business plan showing how I expect to generate income, keep separate business bank accounts, maintain professional records, and track all expenses with receipts. This helps establish that you have a genuine profit motive even before you start making money. For the tools and materials, he advised categorizing them based on their use. Items used exclusively for video production (cameras, lights, editing software) are clearly business expenses. Tools used for projects may be deductible if they're purchased primarily for the business. But the materials that become permanent improvements to your home are trickier and may not qualify as business deductions.

13 Just wanted to mention something that nobody's brought up yet - if you're doing major renovations on your home AND monetizing the content, you might need to look into how this affects your homeowner's insurance and potentially capital gains when you sell the house. Our tax advisor mentioned this could get complicated if the improvements significantly increase your home's value.

This is such a helpful thread! I'm in a similar situation - just started a home renovation YouTube channel and have been totally confused about the tax implications. One thing I've learned from my research is that the IRS looks at several factors to determine if something is a legitimate business vs. a hobby: profit motive, expertise in the area, time and effort spent, expectation of asset appreciation, success in similar activities, history of income/losses, and amount of occasional profits. For content creators specifically, I've read that even if you're not profitable initially, you can still deduct legitimate business expenses as long as you can demonstrate you're operating with a genuine intent to make a profit. The key is maintaining excellent records and being able to justify how each expense directly relates to your content creation business rather than personal home improvement. I'm planning to set up a separate business checking account, create detailed expense categories (production equipment, materials used solely for demonstrations, editing software, etc.), and keep video logs showing how each purchase was used in content creation. Has anyone found other specific documentation strategies that work well for this type of business?