If your cell phone acts as both your business and personal phone, you are only allowed to deduct the portion used for business from your taxable income.
It’s important for you to hang on to your itemized phone bill and receipts to ensure that you’re deducting the right amounts and to keep records of your deduction.
A general guideline you should follow is that a reasonable business expense must be ordinary and necessary. You may think this is too vague, but it may actually be to your benefit.
When you think to yourself whether your expense is ordinary, you should ask the question would a similar business incur this type of expense during the year. If the answer is yes, then the expense is most likely ordinary.
Many business owners think that necessary mean the expenses required. But this is not true at all. For the expense to be necessary, it just needs to be helpful to your business in some way.
