Is cloud hosting tax deductible?
Yes — fully deductible for business use. Cloud hosting costs for business websites, apps, and infrastructure are ordinary and necessary business expenses. Domain names, CDN services, and cloud storage used for business purposes are all deductible. Report on Schedule C, Line 18 or Line 27a.
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On this page: Short answer · What hosting types qualify · Domain names · Mixed personal use · Schedule C · Example · Records · Related lookups · FAQ
Short answer
Yes. Cloud hosting for business websites, apps, and infrastructure is fully deductible. Domain names and related infrastructure costs also qualify. Report on Schedule C, Line 18 (Office Expense) or Line 27a (Other Expenses).
FreshBooks — Track hosting, domain, and infrastructure costs automatically
Categorize AWS, web hosting, and domain renewal charges as business expenses throughout the year so your Schedule C deductions are organized at tax time.
What cloud hosting costs are deductible
| Hosting type | Deductible? | Examples |
|---|---|---|
| Web hosting (shared, VPS, managed) | Yes — 100% if business-only | Bluehost, SiteGround, WP Engine, Kinsta, Cloudways |
| Cloud infrastructure | Yes — 100% if business-only | AWS (EC2, S3, Lambda), GCP, Azure, DigitalOcean |
| Platform hosting / serverless | Yes — 100% if business-only | Vercel, Netlify, Railway, Render, Fly.io |
| CDN and edge services | Yes — 100% if business-only | Cloudflare, Fastly, AWS CloudFront |
| Cloud storage (business use) | Yes — 100% if business-only | AWS S3, Google Cloud Storage, Backblaze B2 |
| Domain registration and renewals | Yes — 100% if business-only | Namecheap, GoDaddy, Google Domains, Cloudflare Registrar |
| SSL certificates | Yes | DigiCert, Sectigo, Let's Encrypt (paid tiers) |
| Shared hosting with personal sites | Yes — business-use % only | Allocate by number of sites or storage used |
Domain names: Fully deductible for business
Domain registration and annual renewal fees are deductible as ordinary business expenses when the domain serves a business purpose — a business website, professional email, or client project. This includes:
- Primary business domain (yourbusiness.com) — registration and annual renewal
- Additional domains for client projects, redirects, or brand protection
- Premium domains purchased for business use
A premium domain purchased as an investment (to resell later, not to use) may be treated differently — as a capital asset rather than an immediate expense. If you purchase a domain and use it for business from day one, it's an ordinary expense.
Mixed-use hosting accounts
When a single hosting account serves both business and personal projects, deduct only the business portion. A reasonable allocation can be based on:
- Number of sites: 1 business site + 1 personal site on the same plan → approximately 50% deductible
- Storage allocation: 80% of storage used for business files → 80% deductible
- Usage time: Cloud infrastructure billed by usage → deduct only the business workload costs
For usage-based cloud infrastructure (AWS, GCP, Azure), it's often cleaner to maintain separate accounts for business and personal projects — the billing separation makes the deduction automatic.
Where cloud hosting goes on Schedule C
Cloud hosting and domain costs go on Schedule C, Line 18 (Office Expense) or Line 27a (Other Expenses). Both are appropriate. Some tax professionals prefer Line 27a with a description like "Website hosting" or "Cloud infrastructure" to clearly identify the expense type. Be consistent year to year.
Example: Annual hosting and infrastructure deductions
Example: Freelance web developer
- Business domain (yourbusiness.com): $15/year → deductible ✓
- Client domains (managed for 3 clients): $45/year → deductible ✓
- WP Engine managed WordPress hosting: $360/year → deductible ✓
- Vercel Pro (deploy client projects): $240/year → deductible ✓
- AWS S3 storage (project assets): $8/month = $96/year → deductible ✓
- Cloudflare Pro: $240/year → deductible ✓
- Total hosting and infrastructure deductions: $996/year → Schedule C, Line 27a ✓
At a 22% effective tax rate, $996 in hosting deductions saves approximately $219 in taxes. For developers and agencies with larger infrastructure footprints, this category can represent several thousand dollars annually.
What records to keep
- Monthly or annual invoices from each hosting provider — most have invoice download in the account dashboard
- Domain registration receipts and renewal notices
- Proof of payment (bank or card statement)
- A brief note describing the business purpose of each service (e.g., "client project hosting," "business website CDN")
- For mixed-use accounts: a note explaining your allocation method
TurboTax Self-Employed — Deduct hosting and domain costs on Schedule C
TurboTax Self-Employed guides freelancers and developers through Schedule C software and hosting deductions and handles mixed-use allocations.
FAQ
Is cloud hosting tax deductible?
Yes. Cloud hosting for business websites, apps, and infrastructure is fully deductible as an ordinary and necessary business expense. This includes web hosting (WP Engine, Kinsta, Bluehost), cloud infrastructure (AWS, GCP, Azure), platform hosting (Vercel, Netlify), and CDN services. Report on Schedule C, Line 18 or Line 27a.
Are domain names tax deductible?
Yes. Domain registration and annual renewal fees are deductible ordinary business expenses when the domain serves a business purpose — a business website, professional email, or client project domain. Report on Schedule C, Line 18 or Line 27a.
Can I deduct AWS, GCP, or Azure costs?
Yes. Cloud infrastructure costs are fully deductible when used for business applications, client work, or business operations. Usage-based billing is deductible in the month incurred. Keep monthly invoices and note the business purpose of the resources billed.
What if I use a hosting account for both business and personal projects?
Deduct the business-use portion only. Estimate the business percentage based on number of sites, storage allocation, or usage. For a plan with one business site and one personal site, approximately 50% is a reasonable business deduction. Keep a brief note explaining your allocation method.
What records should I keep for cloud hosting deductions?
Keep monthly or annual invoices from each provider (downloadable from account dashboards), domain registration receipts, proof of payment, and a brief note on business purpose. For mixed-use accounts, note your allocation method. Most providers email receipts each billing cycle — save them to a dedicated tax folder.
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Last reviewed: April 14, 2026