Tax Deductions for Agencies: What Owners Commonly Miss
Last updated: October 17, 2026Written by Shane Atkins, founder of TaxSaver Pro
Agencies stack up software seats, subscriptions, and client travel, with costs spread across many tools and projects. It's easy to lose track of a deductible tool or let a recurring cost go uncaptured. This guide walks through the deductions agency owners most often overlook.
Commonly missed deductions
01Home office
- What qualifies
- The space used for client management and creative work.
- What doesn't qualify
- Space also used for personal or family purposes, occasional or incidental work at home, and costs for parts of the home not used for business. W-2 employees working from home generally can't take this deduction on their federal return.
- Records to keep
- Measurements of the office and of the whole home, a photo or floor plan of the space, and, if you use the regular method, rent or mortgage interest statements, utility bills, homeowner's or renter's insurance, and repair receipts.
02Software and subscriptions
- What qualifies
- Design, project, and analytics tools.
- What doesn't qualify
- Personal subscriptions (streaming, personal apps, personal cloud storage) and the personal-use share of anything used for both.
- Records to keep
- Invoices or account statements, and a short note on the business purpose for any subscription where it isn't obvious.
- IRS source
- IRS Publication 535 — Business Expenses
03Professional development
- What qualifies
- Courses, certifications, and conferences.
- What doesn't qualify
- Education that qualifies you for a new trade or business, or that you need to meet the minimum requirements of your current field.
- Records to keep
- Receipts for course fees, materials, and books, plus a short note on how the training relates to your current business.
04Phone and internet
- What qualifies
- Client calls and online collaboration tools.
- What doesn't qualify
- The personal-use share of your phone or internet, and the basic charge for the first landline into your home.
- Records to keep
- Monthly bills and a written basis for your business-use percentage, such as a review of a typical month's usage.
- IRS source
- IRS Publication 535 — Business Expenses
05Business insurance
- What qualifies
- Professional liability coverage.
- What doesn't qualify
- Personal life insurance where you or your family are the beneficiary, personal auto or homeowner's policies (those are covered through the vehicle or home office deduction), and insurance that replaces your own lost income. Self-employed health insurance is claimed separately, not as a business expense.
- Records to keep
- Policy declaration pages, premium invoices, and proof of payment.
- IRS source
- IRS Publication 535 — Business Expenses
Records checklist
A summary of every record mentioned on this page. Keep these with your tax return.
- Home officeMeasurements of the office and of the whole home, a photo or floor plan of the space, and, if you use the regular method, rent or mortgage interest statements, utility bills, homeowner's or renter's insurance, and repair receipts.
- Software and subscriptionsInvoices or account statements, and a short note on the business purpose for any subscription where it isn't obvious.
- Professional developmentReceipts for course fees, materials, and books, plus a short note on how the training relates to your current business.
- Phone and internetMonthly bills and a written basis for your business-use percentage, such as a review of a typical month's usage.
- Business insurancePolicy declaration pages, premium invoices, and proof of payment.
Related guides
Go deeper on the rules behind these deductions
Educational guidance only, not tax advice. Talk to a tax professional about your situation.