Can I Deduct My Phone or Tablet Purchase from Amazon?

Quick Answer

Self-employed individuals, freelancers, and 1099 contractors can typically deduct the business portion of phone and tablet purchases from Amazon. W-2 employees cannot deduct these purchases due to the Tax Cuts and Jobs Act of 2017.

Key deduction rules:

Only the business use percentage is deductible (if 70% business, deduct 70% of cost)
Phones/tablets no longer "listed property" - detailed call logs not required
Both device purchase AND monthly service bills may be deductible
Categorized under IRS Schedule C, Line 18 (Office expense)
Reasonable estimation method required for business use percentage

Common business use percentages:

Primary business phone/tablet: 60-80%
Tablet used significantly for work: 50-70%
Backup or secondary device: 30-50%

Deduction methods:

Section 179 or Bonus Depreciation: Immediate full deduction of business portion
Standard Depreciation: Spread over multiple years (less common)

For example: A freelance consultant purchasing a $1,000 iPhone from Amazon used 65% for business can deduct $650 ($1,000 × 65%) under Schedule C, Line 18. Additionally, if their monthly service is $80/month and 65% business use, they can deduct $52/month ($624/year).

Phone and tablet business deduction guide

Why Phone and Tablet Deductions Are Confusing

Most freelancers and 1099 contractors use their smartphones and tablets constantly for business—responding to client emails, taking business calls, managing invoices, video conferencing, and more. At the same time, these devices are also used for personal activities like social media, streaming, gaming, and personal calls.

This creates several challenges:

Mixed-use allocation - How do you determine what percentage is truly business vs personal?
Documentation requirements - What records do you need to support your business use claim?
Uncertainty about monthly bills - Can you deduct the device purchase, the monthly service bill, or both?
Confusion about depreciation - Do you deduct the full cost immediately or depreciate it over time?

For a $1,200 iPhone or $800 iPad, getting the deduction right can make a meaningful difference in your tax bill—but only if you understand the rules.

When a Phone or Tablet May Be Deductible

Self-Employed (1099 Contractors, Freelancers, Sole Proprietors)

For example, if a freelance graphic designer purchases a new iPad Pro from Amazon and uses it 70% for client design work, proposals, and business communications, the business portion of that purchase may be deductible as a business expense. The designer would calculate 70% of the purchase price as the deductible amount.

Self-employed individuals who file Schedule C can typically deduct phones and tablets when:

Ordinary and necessary - The device is commonly used and helpful for your type of business
Business use is documented - You can show what percentage of use is business-related
Used in your trade or business - The device helps you generate income or serve clients

In situations where a consultant buys a $1,000 iPhone from Amazon and uses it 60% for business (client calls, emails, scheduling, invoicing), 60% of the cost ($600) may be deductible as a business expense on Schedule C.

W-2 Employees

For W-2 employees, the rules are much stricter. After tax law changes, most W-2 employees cannot deduct unreimbursed employee expenses, including phones and tablets, even if used for work purposes.

Exception: In rare cases where an employer requires you to purchase a device as a condition of employment AND does not reimburse you, there may be limited state-level deductions available depending on where you live. Consult a tax professional for your specific situation.

Business Entity Owners (LLC, S-Corp, C-Corp)

In scenarios where a business owner purchases a phone through their registered business entity and the device is used primarily for business purposes, the business may deduct the full cost as a business expense, or the owner may be reimbursed through an accountable plan.

Business owners can often structure phone and tablet purchases as:

Direct business expenses (purchased with business funds)
Reimbursements under an accountable plan
Company-provided equipment

How to Calculate the Business Use Percentage

Since most phones and tablets are used for both business and personal purposes, you need to estimate your business use percentage. The IRS does not require call-by-call logs (phones are no longer classified as "listed property" requiring detailed tracking), but you should have a reasonable method for your estimate.

Common Methods

Time-based estimation: In a scenario where a freelance writer tracks their phone usage for two typical weeks and finds they spend approximately 8 hours per day on business-related calls, emails, and apps, and 4 hours on personal use, their business percentage would be roughly 67% (8 ÷ 12 hours).

Purpose-based allocation: For example, if a photographer uses their iPad exclusively for editing client photos, managing bookings, and sending invoices during work hours (approximately 50 hours/week), and only uses it for personal entertainment in the evenings (approximately 10 hours/week), the business use percentage could reasonably be estimated at 83%.

Conservative industry standards: Many tax professionals suggest conservative estimates like:

Primary business phone: 60-80% business use
Tablet used significantly for work: 50-70% business use
Backup or secondary device: 30-50% business use

The key is to use a reasonable, defensible method and document your reasoning.

What You Can Deduct

The Device Purchase

In cases where a self-employed consultant purchases a $1,200 iPhone from Amazon and uses it 70% for business, they could deduct $840 (70% of $1,200) as a business expense.

You have two deduction methods:

Option 1: Section 179 or Bonus Depreciation (Immediate Deduction) For equipment purchases, many small business owners can deduct the full business portion in the year of purchase using Section 179 or bonus depreciation rules.

Option 2: Standard Depreciation Phones and tablets can be depreciated over their useful life. The IRS typically allows depreciation over a period of several years for technology equipment.

Most small business owners prefer the immediate deduction for simplicity.

Monthly Service Bills

In addition to the device itself, you can also deduct the business portion of your monthly service costs.

For example, if a freelance developer pays $80/month for their phone plan and uses the phone 65% for business, they could deduct $52/month ($624/year) as a business expense.

This includes:

Monthly service charges
Data plans
Line access fees
Additional charges for business use (international calls, extra data during business trips)

Accessories and Related Costs

Business-related accessories may also be deductible when used primarily for business:

Phone cases (if protecting a business device)
Screen protectors
Charging cables and accessories
Business apps or software subscriptions

The business use percentage should be applied consistently to related purchases.

When a Phone or Tablet Is NOT Deductible

Personal Use Only

If a device is used exclusively or primarily for personal purposes—gaming, social media, personal entertainment—it would not qualify as a business deduction.

W-2 Employees Without Special Circumstances

For most W-2 employees, unreimbursed phone and tablet purchases are no longer deductible at the federal level.

Already Reimbursed by Employer

If your employer provides a phone, a phone allowance, or reimburses you for device purchases, you typically cannot also claim a personal deduction for the same expense. That would be double-dipping.

Lack of Documentation

In situations where someone claims a business deduction for a phone but cannot explain what percentage was used for business or provide any supporting documentation, that deduction could be challenged or disallowed during an audit.

How to Document Your Phone or Tablet Deduction

To support your deduction, maintain:

Purchase Records

Amazon order confirmation email
Receipt showing device model, price, and purchase date
Payment confirmation (credit card statement or invoice)

Business Use Documentation

A written explanation of how you use the device for business
Sample log showing typical business vs personal use for a representative period
Invoices, client communications, or time-tracking data showing business use

For example, a freelance consultant might document: "iPhone 15 Pro purchased 3/15/2025 for $1,199. Used 70% for business including client calls, email, calendar management, invoicing via mobile apps, and project management. Business use estimated based on 2-week usage log showing 35 business hours vs 15 personal hours per week. Deductible amount: $839.30 (70% of purchase price)."

Monthly Bill Records

Keep copies of monthly phone bills
Highlight or note business use percentage
Retain for the IRS-recommended period (typically at least 3 years)

Business Use Calculation

Document your methodology for calculating business percentage
Keep notes explaining why your percentage is reasonable for your profession
Update estimates if usage patterns change significantly

Tools like Purchase Deductions can help you document Amazon purchases by forwarding order emails, automatically generating business purpose documentation, calculating deductible amounts for mixed-use items, and organizing records using IRS Schedule C categories.

Common Mistakes to Avoid

Deducting 100% When There's Personal Use

Even if you use your phone heavily for business, claiming 100% business use when you also text friends, browse social media, or watch videos is overstating the deduction and could trigger issues in an audit.

Not Separating Device from Service Costs

These are separate deductions. The device purchase is typically capitalized or immediately expensed (Section 179), while monthly service bills are ongoing operating expenses.

Forgetting About Tablets

Many freelancers remember to deduct their phone but forget about tablets used for business. If you use an iPad, Android tablet, or similar device for client presentations, design work, note-taking, or business apps, the same rules apply.

Using Personal Funds Without Proper Documentation

In cases where a business owner purchases a phone with personal funds but later wants to claim it as a business expense, proper documentation becomes critical. The business should reimburse the owner through an accountable plan, or the expense should be clearly documented as a business expense on Schedule C.

Ignoring Accessory Purchases

Small purchases add up. In a scenario where someone spends $200/year on phone accessories (cases, cables, screen protectors) for a business phone, that's an additional deduction opportunity that shouldn't be overlooked.

How Purchase Deductions Helps

When you forward your Amazon order confirmation emails to Purchase Deductions:

Automatic extraction - Order details (device name, price, date) are automatically captured
Business purpose documentation - AI generates documentation explaining business use for phones/tablets
Mixed-use calculations - The system estimates business use percentage based on your profile and calculates the deductible amount
IRS categorization - Purchases are categorized using Schedule C expense categories (typically "Office expense" for devices)
Review and edit - You verify, adjust the percentage, or regenerate with feedback

For example, if you forward an email for an iPhone purchase, Purchase Deductions might generate:

Product: iPhone 15 Pro, $1,199
Category: Office expense
Business Use: 70%
Deductible Amount: $839.30
Business Purpose: "Smartphone used 70% for business including client communications, email management, calendar scheduling, mobile invoicing, and professional apps. 30% personal use. Business percentage based on time tracking analysis."

You can accept this analysis, edit the percentage to match your actual usage, or request a regeneration with specific feedback.

Frequently Asked Questions

Can I deduct my phone if I only have one phone?

Yes, in situations where a self-employed individual has only one phone but uses it significantly for business, they can still deduct the business portion. You simply need to calculate and document what percentage is business use versus personal use.

What if I upgrade my phone every year?

Each device purchase is a separate deduction. If you purchase a new phone every year and use it primarily for business, you can deduct the business portion of each purchase in the year it's made.

Do I need to keep a detailed call log?

No. Since phones were removed from the "listed property" category, the IRS no longer requires detailed call-by-call logs. A reasonable estimation method with supporting documentation (like a sample usage period) is typically sufficient.

Can I deduct both the phone and the monthly bill?

Yes. The device purchase and the monthly service costs are separate deductions. In cases where a freelancer buys a $1,000 phone (one-time deduction) and pays $75/month for service (ongoing monthly deduction), both may be deductible based on business use percentage.

What about a phone purchased for an employee?

If you're a business owner purchasing phones for employees, those are typically 100% deductible business expenses (not mixed-use), since they're provided specifically for business purposes.

Does this apply to smartwatches too?

Yes, similar principles apply. In scenarios where a business owner purchases an Apple Watch primarily for business notifications, calendar management, and fitness tracking for business wellness programs, the business portion may be deductible.

Disclaimer

The information in this article is for general informational purposes only and should not be construed as professional tax, legal, or financial advice. Tax laws are complex and change frequently. Always consult with a qualified tax professional or CPA before making decisions about your specific tax situation. Purchase Deductions provides tools to help organize your Amazon purchase data, but we are not tax advisors and cannot guarantee the deductibility of any specific purchase.

Key Takeaways

Self-employed individuals can typically deduct the business portion of phone and tablet purchases from Amazon, while W-2 employees generally cannot deduct these expenses
Only the business use percentage is deductible - if you use a $1,200 phone 65% for business, you can deduct approximately $780, not the full cost
Both the device purchase AND monthly service bills may be deductible based on the same business use percentage
Documentation is critical - maintain purchase records, calculate and document your business use percentage using a reasonable method, and keep explanations of business purpose
Phones are no longer "listed property" meaning you don't need detailed call-by-call logs, just a reasonable estimation method with supporting documentation
Accessories and related costs like cases, cables, and business apps can also be deducted when purchased for business devices
Use Section 179 or bonus depreciation to deduct the full business portion of the device cost immediately, rather than depreciating over multiple years
Conservative estimates are safer - claiming 100% business use on a personal phone that's clearly used for both purposes could trigger audit concerns; reasonable percentages like 60-75% are more defensible