Is Bank Fees Tax Deductible for Your Business?

Yes, bank fees is generally tax deductible for self-employed individuals, freelancers, and small business owners. The IRS allows you to deduct ordinary and necessary business expenses, and bank fees typically qualifies when used for legitimate business purposes.

Key Rules for Deducting Bank Fees

Monthly service fees for business accounts, wire transfer fees, and merchant processing fees (Stripe, PayPal, Square) are all deductible.

How to Document Bank Fees for Tax Purposes

Proper documentation is critical for any business deduction. For bank fees, you should:

• Keep all receipts and invoices showing the amount paid
• Record the date of the expense and the business purpose
• If mixed-use, maintain a log showing business vs. personal usage
• Store records for at least 3 years (7 years for major purchases)

Source: IRS Publication 535. This information is for educational purposes only. Consult a qualified tax professional for advice specific to your situation.