Home Office Telephone Lines


Home Office Telephone Deductions: Having a business telephone line is a necessity for most home offices. How much of those telephone expenses are deductible? Find out here.

Dear Janet,

I have a home-based gift basket giving service that I'm starting. I'm retired from Bellsouth, so I only have to pay $14.52 in maintenance fees on my main telephone line. I checked into getting another line for my computer, and I'll get 40 percent off the cost of that line. Can I take either the main line or the computer line off my taxes? I need the computer line so I don't miss calls while I'm on the computer. Or do I have to pay for a separate business telephone line to deduct the fees? How do most basketeers work that out? What's the best way to get off as cheaply as I can without losing business?



Dear Jennie,

It's common for home businesses to have multiple phone lines coming into their homes. Most have at least two lines - one for personal business and personal computer use, and a second line for business use. Those who frequently get incoming calls on the business line, often have a third line for business computer use, or if it's available, a cable or DSL phone line hookup for the computer. Still another option: a voice mail system on the computer line to pick up incoming calls when the business line is busy.


The way the IRS treats business use of telephone lines in the home is this: For the first line into the home (your home phone number), you can deduct any phone message unit or long distance charges that are incurred specifically for business. You cannot deduct any part of the base rate of the first phone line coming into your home. But if you have more than one line coming into your home you can deduct the full cost of any extra line you use exclusively for business. You can also deduct the full cost of any voice mail system used exclusively for business.

Good luck!

About the author:
Janet Attard is the founder of the award-winning  Business Know-How small business web site and information resource. Janet is also the author of The Home Office And Small Business Answer Book and of Business Know-How: An Operational Guide For Home-Based and Micro-Sized Businesses with Limited Budgets.  Follow Janet on Twitter at http://www.twitter.com/JanetAttard.

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