When an Expense Is Both Business and Personal: What You Can Deduct

As a practice owner, it’s common to have expenses that overlap between business and personal use.
The tricky part is figuring out which portion is deductible — and documenting it properly.

Done correctly, this can save you money at tax time.
Done incorrectly, it can raise red flags with the IRS.

Here’s how to handle common mixed-use expenses the right way:

🏠 Home Office Costs

If you use a dedicated space in your home for admin work or telehealth, you can deduct a percentage of household expenses such as mortgage interest, rent, utilities, internet, and insurance.

The deduction is based on the square footage used for business compared to your total home.
Keep clear notes on what percentage of your home is used exclusively for work.

📱 Mobile Phone and Internet Bills

Phones and internet are often mixed-use items.
You can deduct the percentage used for practice-related calls, emails, scheduling, and other work tasks.

For example, if 70% of your phone usage is for business, 70% of your bill is deductible.

✈️ Travel Expenses

If a trip combines both business and personal activities, only the business portion counts.
Airfare to attend a dental conference is deductible — but family vacation days or personal activities are not.

Meals and lodging are deductible only for the days you’re actively working.

🚗 Vehicle Expenses

If you use your car for both personal and practice purposes, you can only deduct the business portion.
This is often tracked by mileage logs or total percentage of business use.

Pro tip: apps like MileIQ or QuickBooks’ mileage tracker make this simple and IRS-compliant.

💻 Equipment and Software

If you buy equipment or software that you also use personally (like a laptop, tablet, or scheduling platform), you can only claim the percentage used for practice management.

For example, if your laptop is used 80% for work and 20% for personal, you can deduct 80% of the cost.

💡 Utilities and Subscriptions

If you share subscriptions or tools between personal and business use — like Canva, Dropbox, or streaming services — deduct only the business percentage.

If Canva or QuickBooks is used strictly for your practice, it’s fully deductible. But if it’s also used for personal projects, allocate accordingly.

🩺 The Bottom Line

You can deduct the business portion of mixed-use expenses — but you’ll need clear records, receipts, or usage logs to support your claims.

Keeping things clean and organized not only helps at tax time, but also protects you in case of an audit.

📞 Ready to Get Clarity?

We’ll help you review your books, organize your accounts, and create a system that makes mixed-use deductions simple and stress-free.

Schedule a call with us to get started today.