Is Interest on a Business Credit Card Deductible?

Credit card interest accrued on business expenses is itself a tax-deductible business expense.
Claire TsosieFeb 4, 2019

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You’ve been carrying a balance on your  and racking up interest charges. Now it’s tax time. Can you write off those interest charges as a business expense?

The answer: Yes — but only if the interest was accrued on purchases that were business expenses.

Generally, you can deduct credit card interest if:

At one time, on personal expenses was deductible. But the Tax Reform Act of 1986 changed that; you can no longer deduct interest accrued on personal expenses. If you’ve made both personal and business purchases on your card, you can deduct only the interest from business expenses, according to the IRS.

Many business credit cards offer itemized statements and year-end account reports, which can make it easier to find out how much you’ve been billed in interest.

Credit cards allow you to carry debt for months, which raises an important accounting question: Can you deduct interest you haven’t actually paid yet? The answer depends on which of the two main accounting methods you’re using:

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