The life of a travel blogger is often envied by most people. As a viewer, it seems like travel bloggers live the ideal life where they can write off exotic vacations and fancy meals, however, the reality is a lot different.
Blogging as a profession is something of a gray zone when it comes to taxes.
The IRS has very specific guidelines determining the difference between a hobby and a business:
There are other methods that the IRS uses to distinguish a hobby from a business, but they will usually only be used during an audit. As a general rule, as long as your blog/website turns a profit in most years, it’ll be classified as a legitimate business for tax purposes.
However, it is advised to be careful when claiming tax deductions. If you’re not sure whether you qualify for a specific deduction, consult a tax professional. Creativity is essential for a blogger to have, but getting creative with your taxes can land you in serious trouble.
Now, before we list down the deductions applicable to the travel bloggers, let’s first answer the question at hand- Can travel bloggers write off exotic vacations and fancy meals?
It’s a yes and a no. As a travel blogger, your meals and travels can be considered a deductible as long as it’s related to your blog. You can also deduct expenses to and from an industry event if you’re being sponsored by an agency or brand.
Start-up expenses (capital expenses) are not deductible unless the business owner elects to deduct the expenses. According to the IRS, you can deduct up to $5,000 in business startup costs and $5,000 in organizational costs.
Startup costs generally include the costs to get your business up and running before it opens, such as advertising, salaries, and wages for employees in training, travel to obtain suppliers or customers, or consulting fees. So, as a blogger, you’ll also have startup costs associated with building your website. This may include hiring a web developer to set up the website for you.
Website and hosting expenses
Once your website is up and running, you’ll encounter certain expenses necessary for the maintenance of the site, as well as paying for web hosting.
You may also pay certain web-related expenses to service providers to maintain the technical side of your blog. All these expenses are deductible.
This expense will depend on the type of blog you run. If your blog is related to traveling you can deduct expenses incurred in connection with travel.
Most bloggers run their blogs out of their homes. You can claim the home office deduction by setting up your business premises at your home. Here, you can proportionately split your home rent/mortgage interest and utility bills into personal expenses and business expenses, depending on the portion of space your office space consumes.
You can claim the deduction as a homeowner or even as a renter, and you can use the deduction for any type of home where you reside: a single-family home, an apartment, a studio, or a houseboat. However, you can’t use it for temporary lodging.
Marketing and advertising
Bloggers typically incur marketing and advertising costs while promoting their blogs. This includes any marketing and advertising expenses (Facebook or Instagram ads, ads on other websites, and mailer memberships).
Any expense you make to promote your blog is tax-deductible.
Many bloggers seek help from outside contractors with specific parts of their business. Paying contractors can serve as a tax deduction for bloggers.
You can deduct expenses paid for freelance writers and other contractors. If payments to any individual contractor exceed $600 for the year, you’ll need to issue IRS form 1099 to that contractor. This will be necessary to support the deduction you’ll claim on your tax return.
Any equipment needed to perform your job is usually counted as a deductible expense. You can deduct the cost of equipment and supplies consumed and used during the tax year, this includes your computer and related equipment.
If you purchase computer hardware, it will typically need to be depreciated over several years. However, if you purchase peripheral equipment, such as headphones, a mouse, or a keyboard, those can be expensed immediately.
Fortunately, the IRS allows you to deduct the full cost of a computer or a similar large piece of equipment. It’s done under the Section 179 provision, which allows you to depreciate and claim the expense for 100% of the cost of equipment in the year of purchase.
Computers aren’t the only type of equipment you can claim as a tax deduction. If you purchase a camera or related props so you can take photos and videos of items related to your blogging activities, the equipment may be tax-deductible.
The equipment must be used primarily for your business activities. If it’s used for personal purposes and occasionally used for blogging, it won’t be deductible.
If you’re a travel blogger, you may be able to deduct the cost of travel-related expenses. That includes transportation and lodging at destinations that are the subject of your blog content.
You should be aware that there is a gray area here. The IRS is aware that business-related travel often has a dual purpose: there’s a business purpose and a personal one. You’ll need to make that distinction between business and personal before claiming travel-related expenses. Be very careful not to get carried away with travel deductions.
Conferences and memberships
You may attend conferences or seminars to help you in your blogging business. You may also pay for certain memberships related to your industry.
If you’re blogging for a living, whether as a primary occupation or a side hustle, you’re running a small business. Since your blog is a business, you should treat it like one. FlyFin can help you accomplish organizing your taxes by scanning through all your expenses and categorizing them as personal or business deductions You just have to answer a few questions and get an accurate tax amount within a short span of time.
FlyFin CPA Team
With a combined 150 years of experience, FlyFin's CPA tax team includes tax CPAs, IRS Enrolled Agents and other tax professionals, offering users the most comprehensive tax advice and preparation.