For tax year 2018, the rules have changed on business cell-phone tax deductions, and they are completely wrong.
The IRS is a dinosaur and it’s proving it with the changes to how cell-phones are deducted as a business expense in 2018.
Prior to 2018, it was the cost of service and that’s it. Now, it’s a percentage of cost based on the call time spent on business vs. the call time spent on personal reasons. This is illogical and unreasonable for two major reasons:
- Some of us use cell phones for business in other ways than phone calls when we are away from our computers (researching stories, answering emails, tracking analytics, etc)
- Smartphones are computers and should be treated as such under tax law. We construct documents on them, do email, conduct research, and have conversations. Their cost should be fully deductible and so should the fees to use them (business services).
The IRS is still treating mobile phones as just phones, but no one uses them like that anymore. I make very few voice phone calls anymore because most business is conducted in-person or through email/text. When I am not at my desk, my phone is my computer away from my computer. Considering the percentage of time used, phone calls are the least amount of time my phone serves me.
The IRS has this wrong. I doubt they’ll change it, but the fact that I am unable to deduct my phone service expense because the IRS thinks that the only thing mobile phones do is to call people is silly. We use them to do so much more – this is 2019 for Pete’s sake! (almost).