Yes, you can deduct your cell phone bill as a business expense. But unless you have a phone used exclusively for work, you can only deduct the business-use percentage. The IRS does not allow you to write off 100% of a phone that’s also used for personal calls, texts, and scrolling.

For most contractors and trade business owners, the phone is essential. You’re calling clients, scheduling jobs, sending estimates, taking photos of work sites, and coordinating with subs. That’s legitimate business use and it should be deducted. The question is how much.

To figure out the business percentage, look at your actual usage. If roughly 70% of your calls and data usage are work-related, you can deduct 70% of your monthly bill. You don’t need to log every single call, but you should have a reasonable basis for your estimate. If the IRS ever asks, “I use it mostly for work” without any supporting logic won’t hold up. A quick review of your call log or screen time for a typical month gives you a defensible number.

The cleaner option is getting a separate phone dedicated to business. When a phone is used only for work, the entire bill is deductible. No splitting, no estimating. The monthly cost of a second line is often worth the simplicity, and many trade business owners prefer keeping work calls off their personal phone anyway.

Your phone bill deduction includes the monthly service plan, data charges, and any add-ons you need for business like a hotspot. The cost of the phone itself can also be deducted or depreciated depending on the price. A phone under $2,500 can typically be expensed in full in the year you bought it.

Record the expense properly in your books each month. If you’re splitting personal and business use, categorize only the business portion as a phone or telecommunications expense. This keeps your financials accurate and makes business tax return preparation straightforward because your accountant isn’t guessing at year end.

One thing to watch out for is consistency. Pick a reasonable business-use percentage and stick with it unless your usage genuinely changes. Claiming 50% one year and 90% the next without explanation is the kind of thing that draws attention during an audit.

If you’re not sure what percentage to use or how to record it, a Long Beach bookkeeper who works with trade businesses can help you set it up correctly. It’s a small deduction on its own, but phone bills combined with other overlooked expenses like mileage, tools, and supplies add up to real tax savings over the course of a year.