Yes — STR hosts can deduct phone and internet expenses used for managing their rental business under IRC §162(a). The key rule: if the line or service is used exclusively for STR management, 100% is deductible. If it is shared with personal use, you must allocate and deduct only the business-use portion.
IRC §162(a) allows deductions for ordinary and necessary business expenses. Phone and internet services clearly meet this standard for STR management — you use them to communicate with guests, manage bookings, coordinate cleaners, and run your listing platforms. The question is not whether they are deductible, but how much.
The IRS requires that mixed-use expenses — those serving both personal and business purposes — be allocated between personal and business use. Only the business portion is deductible. The allocation method must be reasonable and consistently applied.
Phone expenses for STR hosts fall into three scenarios:
If you maintain a separate phone number or device used exclusively for STR management — a second SIM, a Google Voice line routed to a dedicated device, or a business phone — 100% of that line's monthly cost is deductible. There is no personal-use complication.
Most hosts use a single phone for both personal and STR management. In this case, you must estimate what percentage of the phone's use is for STR business. Common reasonable allocations range from 30% to 50% for hosts who manage one or two properties alongside normal personal phone use.
A host managing multiple STR properties, communicating frequently with guests, coordinating vendors, and operating a co-hosting side business might reasonably claim 60–70%. A casual host with one room rented occasionally might claim 15–25%. The key is that the number reflects reality and you can support it with documentation.
Monthly costs for STR-specific apps used on your phone — Airbnb host app (no direct charge), noise monitors, smart lock apps, guest messaging automation tools — are separately deductible as software subscriptions on Line 27a. These are distinct from your phone bill itself.
Internet deductions follow the same logic as phone deductions — dedicated lines are 100% deductible; shared connections require allocation.
If your home internet is your primary service and you use it for both personal browsing, streaming, and STR management, you must allocate. A reasonable allocation for an active STR host who spends several hours per week on management tasks might be 20–40% of the monthly bill.
Document your reasoning: "I spend approximately 10 hours per week on STR management tasks out of 50 hours of total household internet use = 20% business allocation." The methodology does not need to be perfect, but it needs to exist on paper.
Some hosts install a second internet connection — either at their personal residence for the home office, or at the STR property itself. An internet line installed specifically for STR management (or provided at the STR property for guest use) is 100% deductible as a business expense. Keep the installation receipts and monthly bills.
The IRS has not prescribed a single required method for allocating phone and internet expenses. What matters is that your method is:
Accepted approaches include:
| Service Type | Scenario | Deductible % | Schedule C 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 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.
Good records protect your deductions in an audit. For phone and internet expenses, keep:
DeductFlow automatically tracks and categorizes your STR business expenses — including phone, internet, subscriptions, and more — so you capture every legal deduction at tax time.
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