Deductions for a Direct Sales Business

ladyindian1405 · ‎March 9, 2022

I have 2 different direct sales business - one is an online boutique that sells clothing and accessories and the other is cosmetics & skincare company. I'm wondering how to best maximize my deductions.

For example:

1) If I talk to my hairdresser about my businesses while getting my hair done can I write off the cost of getting my hair done? If so, what category would this deduction fall into?

2) If I wear the clothing that I sell and say a waitress compliments me on it and we strike up a conversation about my business, am I able to write off that expense?

3) If I drop off catalogs for my company at my chiropractor's office and then get an adjustment while there, can I write off the cost of that adjustment? What category would this deduction fall into?

4) If I buy a ticket to a theme park and then hand out my business cards and talk to other people there about my business, is the cost of the entry ticket a write off? What category would this deduction fall into?

Thank you!

DianeW777 · ‎March 9, 2022

The answers to your questions follow:

1) - No. This is a personal expense and even though you did talk about your business there is not deductible tax expense.

2) - No. Everyday street wear is never deductible. If you have a name of your company as part of the clothing then you can deduct advertising. If you need specific safety clothing such as steel toed boots as example, those could be deductible.

3) - No. This is also a medical personal expense regardless if business is conducted. You can take the cost of the catalogs.

4) - No. TCJA has suspended all other entertainment expense deductions in 2018 through 2025. Prior to that, businesses were allowed to deduct 50% of the face value of entertainment tickets and events, and 100% of the cost to qualified charitable events, if the purpose was business-related.

This article will provide some information about these deductions. What types of meals and entertainment expenses are deductible on a business return?