Business Internet Usage

• The IRS allows you to deduct your monthly bills from your internet service provider on your federal tax return as long as the use of the internet is a requirement of your business. For example, a self-employed marketing sales representative would be able to deduct internet usage from his taxes, whereas a professional golfer might have a harder time selling the deduction. Your deduction for Internet service billing is proportional to the percentage of Internet use that is for business purposes. For example, if 75 percent of your time using the Internet is for business, you may deduct up to 75 percent of your annual service charges.
  
  

Website Maintenance Fees

• Maintaining a website as part of your business can net you a tax deduction. The IRS allows you to deduct service fees from IT professionals to set up your business website, the cost of purchasing and maintaining a domain name, and any maintenance costs associated with your website from your federal tax return. You should provide proof of your monthly service fees and annual charges, including copies of bills or invoices, when submitting your tax return to the IRS at the end of year.
  
  

Internet Advertising Costs

• Advertising your business services on websites can help increase your exposure and generate new client opportunities for your company. According to the IRS, you may deduct your advertising costs, including fees for placing business ads on websites, from your federal tax return. The IRS considers these deductions as business expenses, meaning you may only take the deductions from year to year as you incur new advertising costs. It's a smart financial move to continually advertise for your business to keep your eligibility to claim advertising costs each year.
  
  

Computers for Business

• Accessing the Internet for any purpose is difficult without a computer or smart phone. The IRS requires you to capitalize certain equipment, including a computer used for your business, as a condition of starting your company. The IRS considers a capitalized expense as an asset of your business. You may claim the purchase price of a capital asset over a number of years using The Modified Accelerated Cost Recovery System. This allows you to eventually recoup the purchase price of the asset as its value declines through use.