I am a consultant with multiple direct sales companies. I buy products from all of these companies that I use partly for personal use, and partly for demo and marketing business use. Can I deduct a percentage of the cost based on the percentage of time they are used for business similarly to deducting a percentage of my cell phone cost based on the percentage it’s used for business use? Or, if I use them for any personal use at all are they not deductible?
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You must REMOVE the personal use items from the inventory figure ... easiest way to do this is make a separate order and pay with personal funds. That way the purchase and the payment never shows up in the business books or accounts. Demo products can be expensed.
I understand that I wouldn't be able to deduct items that are purchased solely for personal use. What I'm not clear on is whether I can deduct all or a portion of the cost of products I've purchased from the direct sales companies I work for that are used for both business (demos, marketing, advertising) and personal use.
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