Cell phone purchase price business deduction

[davydude7]

I am seeing mixed answers on this subject. I purchased a phone that I use for both personal and business needs. I calculated the percent usage to be 30% for business (1099 sole proprietor) and 70% personal/W2 job usage. I paid for the phone as a lump sum in 2019. I already plan on deducting 30% of the price of the phone bill. Am I able to deduct 30% of the phone purchase price as well? This is where I am seeing mixed answers, some saying no based on a ">50% business use rule" or something like that. Thank you in advance. 

[WillK]

The cell phone itself would be considered an asset, so you would take the 30% you calculated as an asset and depreciate that over it's useful life on your return. The cell phone might qualify for either section 179 deduction or bonus depreciation (meaning you can depreciate the phone faster). To see if it qualifies for either 179 Deduction or Bonus depreciation click here: What is a Section 179 deduction? - Community or here: Solved: What is bonus depreciation - TurboTax.

[davydude7]

Thank you for your reply. It looks like it would not qualify under section 179 because it isn’t used more than 50% for the business. I will test it out in turbo tax to try to deduct as a depreciable asset.

[Hal_Al]

see https://turbotax.intuit.com/tax-tips/small-business-taxes/can-cellphone-expenses-be-tax-deductible-w...

Note: revised 1-15-20. 3:20AM

[AmeliesUncle]

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@Hal_Al wrote:

Only the additional costs in using a cell phone for business are deductible. If you pay a flat rate on a phone used for business and personal calls, the tax court has held that the flat rate is for your personal phone and you incurred no additional charges for business use. You have no deduction. (TC Memo 2007-151).

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That 2007 Court Case no longer applies in regards to the cell phone.  That case denied the deduction because the taxpayer did not meet the STRICT record keeping requirement for "Listed Property".  However, since 2010 cell phones are no longer "Listed Property".

[davydude7]

AmeliesUncle,

In your opinion, do you think I need to deduct the phone as a depreciable asset, or can I expense it for 2019 taxes? It will be about a $200 deduction. If I deduct as a depreciable asset, over how many years does a phone need to depreciate?