Understanding Marketing Tax Deductions
Richard A. Chapo, Esq.

Marketing is a necessary expense in running practically any business and the IRS acknowledges as much. You may run advertisements on or in the Internet, radio, television, magazines, newspapers and other media to sell your products or services. You should be deducting all of the associated costs on your tax returns.

Ordinary Marketing Expenses

Marketing costs must be "ordinary and necessary" business expenses in order to be deductible. Put in layman's terms, you marketing must be reasonably related to the promotion of your business and the expense amount must be a reasonable amount.

Deductible Marketing Expenses

Common deductible marketing expenses include the costs associated with the following items:

• Yellow Page Advertisements
• Business Cards
• Advertisements in print media such as newspapers
• Telemarketing
• Business Cards
• Web site costs including creation and maintenance.
• Costs for Advertisements on the Internet
• Billboards
• Graphic design costs

Goodwill Marketing For Your Business

Marketing that is intended to portray your business positively can be deducted. Such marketing creates a long-term potential for business and, thus, falls within the ordinary and normal requirements of the tax code. Examples of such marketing include:

• Sponsoring local youth sports teams
• Distributing samples of your business product
• Costs associated with prizes offered by your business in a contest

As long as your marketing expenses can be reasonably related to the promotion of your business, you should be deducting said expenses from your gross revenues. If you failed to claim any such expenses on your tax returns, contact us to find out if a tax refund can be obtained.

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This article is intended to be a general commentary on tax issues. Each taxpayer's situation is unique and it is recommend that you speak with a tax professional regarding your particular situation. If you have additional questions, please contact us.

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