Self employed web developers/designers, how do you report expenses on your Schedule C?
I'm curious how you guys categorize the following expenses:
-hosting
-themes
-domain names
-domain name renewals
-outsourced coding help (under $600)
Thanks!
Answers (10)
Mark V.
Experienced Cellular Network Engineer
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You'd be better off asking a tax professional. Asking your peers is the blind leading the blind.
Rob A.
Experienced Web Professional
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I send it all to my accountant.
Martha R.
Website developer who can turn your ugly duckling site into a beautiful swan. Also an author who's seeking an agent.
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1. Hosting, if it's for one of my sites, is advertising/promotion. If I ever had a brain fart and got back into hosting client sites, it would be subcontracting.
2. Themes purchased for clients are subcontracting. Themes bought for me are advertising/promotion.
3. I only buy domain names for myself. So, they're advertising/promotion. As for clients, come on. In this day and age, they can buy their own domain names. It's not like the bad old days of the mid-1990s when you had to fill out that horrendously long, incomprehensible form at InterNIC.
4. Domain name renewals? See item 3 above.
5. Outsourced coding help (under $600) is subcontracting. Same goes for above $600.
Yosef B.
Documentation Manager—The more technical, the more challenging
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Rely on your accountant, who will show you that the IRS wants groupings, not shades of meaning. They want to know how much you spent on different categories like rent, utilities, outside services, supplies, subscriptions, R&D.
Category A: Domain names and hosting are forms of rent. There is no difference between buying or renewing a domain name.
Category B: Outside services like paying for themes and coding.
Mark A.
Senior Software Developer / IT Professional
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Don't forget to take a moment and reflect on the fact that every U.S. citizen (as well as anyone doing business in the U.S.) is deemed by the IRS to be responsible for understanding the tax code as it applies to him or her, and yet the majority of responses you'll see are going to indicate that this question requires the knowledge of a (typically well-paid) specialist.
Wallace J.
Multimedia Producer, i3D Programmer, Acrobat 3D PDF, Android App, Virtual World & iTV Design, Kindle, Nook & Sony eBooks
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Itemized similar to your list.
Peter C.
Senior Software Engineer at Say.So
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Itemize it as your list, and then give it to your accountant.
Elaine B.
Owner at Social Media Strategist and The Professional Bookcoach
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Get yourself a good accountant.
Darrell Z. D.
Certified High Performance Résumé Writer ♦ Copywriter ♦ Sales, Advertising, SEO & Marketing Writer with ★★★★★ Reviews
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Honestly, you want to ask this question again in the Tax Accounting Area of Q & A as true expertise is needed. The tax laws change annually here in America. Also, often outsource help is automatically categorized by the IRS the according to their rules not what you think is 1099. Wait till you read those details...
Make sure you go to an accountant who specializes in preparing tax returns and really knows the laws well. They can save you thousands every year. For example, did you know you can contribute to a tax deferred Annuity for retirement without any limit on the amount of income you shelter from taxes? Now, that's wealth building...
Greg A.
GM: Active Technologies - GM: designhostseo.com - Technologies - Columnist: Community Newspapers, Inc
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Accurately and conservatively. You don't want to go through an audit. Besides, sleeping at knight is a good thing.
