Expenses
Tax Strategy
April 6, 2026
Can I Deduct My Internet and Phone for STR Management?
- Reasonable — reflects your actual usage pattern
- Consistent — applied the same way year to year
- Documented — recorded somewhere you can produce if audited
Accepted approaches include:
- Time tracking: Log actual hours of business vs. personal use for a representative period (e.g., two weeks), then use that ratio as your annual allocation.
- Activity count: Count business-related calls, texts, or data sessions versus personal ones over a sample period.
- Reasonable estimate: A documented estimate ("approximately 35% of my phone time is STR management based on my hosting activity level") is acceptable if it is defensible and supported by your booking volume.
| Service Type |
Scenario |
Deductible % |
IRS Line |
| Phone |
Dedicated STR line |
100% |
Line 25 |
| Phone |
Shared personal/business |
30–50% (documented) |
Line 25 |
| Internet |
Dedicated STR property or office line |
100% |
Line 25 |
| Internet |
Home internet, shared use |
20–40% (documented) |
Line 25 |
| Phone apps |
STR-specific apps only |
100% |
Line 27a |
IRC §280A Considerations
IRC §280A generally restricts deductions related to a taxpayer's personal dwelling. Phone and internet expenses, however, are not dwelling expenses — they are communication and utility costs. The §280A limitations apply to home expenses allocated to rental use (such as mortgage interest, depreciation, and utilities of the home itself). Phone and internet expenses are separately analyzed under IRC §162(a) and your mixed-use allocation rules.
If you are also claiming a home office deduction under §280A(c)(1), be careful not to double-deduct internet: if internet is included in your home office's utility allocation under the regular method, do not also separately deduct the business portion of internet on Line 25. Pick one treatment and apply it consistently.
⚠️
Avoid double-deducting internet. If you use the regular method for your home office and internet is included in your home's utility calculation, do not also claim a separate internet deduction on Line 25. If you use the simplified method (no utility allocation), a separate internet allocation on Line 25 is appropriate.
Documentation Best Practices
Good records protect your deductions in an audit. For phone and internet expenses, keep:
- Monthly statements showing service costs
- A written allocation methodology note (one paragraph in your records is sufficient)
- For dedicated lines: the account setup documentation showing the line is for business
- For shared lines: a brief activity log for a representative period to support your percentage
- The total annual cost and deductible amount you claimed
💡
Document once, benefit all year. You do not need to track every call or click. Spend 15 minutes documenting your allocation methodology at the beginning of the year. That single note covers your entire year's deduction and creates an audit trail.
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