Can I deduct Spotify & subscriptions?
The Simple Rule
Subscriptions follow the same “ordinary and necessary” test as any other business expense: is the subscription common in your trade and helpful for your work? If the answer is yes and you’re self-employed, it’s deductible. If it’s a personal or entertainment subscription, it’s not — regardless of whether you happen to use it during work hours.
The IRS eliminated the entertainment expense deduction entirely in the 2017 TCJA. Before that, some entertainment costs were 50% deductible. Now they’re 0%. This means streaming services, music platforms, and gaming subscriptions have no path to deduction unless they’re genuinely integral to your business.
The Full Breakdown by Subscription
| Subscription | Deductible? | Why |
|---|---|---|
| Adobe Creative Cloud | Yes, 100% | Industry-standard design/creative tool |
| QuickBooks / FreshBooks | Yes, 100% | Business accounting software |
| Zoom / Google Meet | Yes, 100% | Business communication tool |
| Slack | Yes, 100% | Business communication tool |
| Microsoft 365 (business use) | Yes, biz % | Deduct business-use portion |
| Canva Pro | Yes, 100% | Design tool for business |
| GitHub / hosting | Yes, 100% | Development infrastructure |
| Industry publications / journals | Yes, 100% | Research / professional development |
| Spotify / Apple Music | No | Personal entertainment |
| Netflix / Disney+ / Hulu | No | Personal entertainment |
| YouTube Premium (personal) | No | Personal entertainment |
| Gaming subscriptions | No | Personal entertainment |
| News apps (NYT, WSJ) | Maybe | Deductible if directly relevant to your trade |
| LinkedIn Premium | Maybe | Deductible if used for client prospecting |
The Spotify Loophole That Doesn’t Exist
Every tax season, someone argues: “I listen to Spotify to focus while I work, so it’s a business tool.” The IRS doesn’t buy this. Music for focus or ambiance is a personal choice, not a business necessity. You could work in silence. You could listen to free radio. Choosing to pay for a premium music experience is a personal preference.
The narrow exception: if you’re a music teacher, DJ, music producer, content creator, or fitness instructor who needs access to a music library as a direct part of delivering your service, you may have a legitimate case. A DJ who uses Spotify to preview tracks for a gig has a different argument than a software developer who listens while coding.
Mixed-Use Subscriptions
Some subscriptions serve both business and personal purposes. Microsoft 365 is a common example — you use Word for client proposals and also for personal documents. In these cases, you deduct the business-use percentage, just like you would with home internet or a cell phone.
Estimate the split honestly. If you use Microsoft 365 roughly 70% for business and 30% for personal, deduct 70% of the cost. Document your rationale — a brief note in your records is sufficient.
Where It Goes on Your Return
Business software subscriptions go on Schedule C, Line 18 (Office expenses) or Line 25 (Other expenses — with a description like “Business software subscriptions”). Either line works; be consistent year to year. If you have many subscriptions, grouping them under “Software & SaaS” on Line 25 keeps things clean.
The Bottom Line
Business software = deductible. Entertainment = not deductible. Adobe, Zoom, QuickBooks, Slack, hosting, and industry tools go on Schedule C. Spotify, Netflix, and streaming services are personal expenses. For mixed-use subscriptions, deduct the honest business percentage. The TCJA killed the entertainment deduction entirely — no amount of “I use it for work” changes this for entertainment platforms. Audit your subscriptions once a year and you’ll capture everything that’s legitimately deductible.