Social media is full of people claiming wild tax strategies to help you save a buck (and to give them a buck by giving them a like/share).
A common strategy I come across is about how many expenses can be run through a business. Everything from your car to vacations.
There's only one problem - you can't. You might get a tax accountant who says you can, but have fun trying to explain to an IRS agent why you deducted 100% of your "business trip" to Cabo, where you paid for your whole family to come and business was discussed for 20 minutes on the beach.
WHAT CAN BE DEDUCTED?
The IRS boils it down to anything that is "ordinary" and "necessary" to your business.
Here's an example using a family member who makes money as a social media influencer dealing primarily with teaching:
He has publically (via a Netflix show, no less) said that he wants to buy a Corvette. The "finance gurus" on TikTok would say, "Gabe, just take one video with that Corvette, and you could deduct that against your income since it's a business expense!"
Wrong.
He could MAYBE write off a very small fraction of the Corvette for one video, but definitely not all of it.
The only way he could write off more would be if he were a social media influencer who specifically makes videos about cars/Corvettes. This is because it would be necessary and ordinary for someone in that specific line of work to do so.
But even then, an IRS agent would be very interested to see how much personal use that Corvette had.
There definitely are ways to deduct expenses strategically through a business, but always speak to a (non-sketchy) tax accountant before implementing anything you hear on social media.
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