As we get closer to the end of the year, taxes are likely looming in your mind. We don’t like to think about them, but it doesn’t have to be all bad. Whether you ran just one digital marketing campaign or hired a marketing firm to build a new website or advertised your services all year, it’s important to know that marketing expenses are tax-deductible. 

The government allows you to deduct marketing expenses used to generate and keep clients and candidates. Advertising and marketing expenses qualify as an ordinary, reasonable and necessary tax deduction, and when done right with a professional team like Recruiters Websites, marketing and advertising can have a high ROI.

Marketing and advertising expenses aren’t a particularly tricky tax deduction as long as they are directly related to your recruiting firm’s activities. Below you’ll find eight categories of tax-deductible marketing expenses for recruiters, as well as some that are not considered “marketing,” according to the IRS.

Common Marketing Tax Deductions for Recruiters

Website Expenses

If 2023 was the year you decided to launch or redesign a website for your firm, that’s great news, because it’s deductible. This includes designing, developing and creating your website as well as any website fees for hosting, maintenance and any ongoing website content creation.

Make sure to document all of the different accounts and companies you pay each month to deduct these expenses if you use more than one.

Marketing and Advertising Expenses

This is a broad category because it covers basically anything you would use to market your recruiting firm entirely. This includes content writing, SEO services, email marketing and newsletters, graphic design and branding, search and behavioral ad campaigns, social media ads and any marketing plan or strategy created.

Again, if these marketing efforts are done by different companies, make sure to document all of those accounts and companies. To keep things simple, work with a company that can do all of the above for you.

Social Media Expenses

There is a lot that goes along with running your social media accounts, and most of this can be deducted at the end of the year. This includes paying a consultant or marketing agency (or anyone outside your company) to run your social media channels and any fees associated with them, content-creation expenses, subscription-based social media sites like LinkedIn Pro and paid ad campaigns on your channels. 

This can also include any influencer marketing expenses, which may require 1099 contracts, depending on the amount paid. 

Technology and Marketing Software Expenses

If you use a CRM, ATS, scheduling tool or marketing software that has a monthly or annual subscription, it can be deducted. This includes software such as Hubspot, Hootsuite, Mailchimp, ActiveCampaign, Loxo, PCRecruiter, etc., including an AI-assisted marketing tool like TalentScribe. 

Print Advertising Expenses

Yes, print media is still alive and well. Print media includes purchased ad space in newspapers, magazines or on billboards, as well as the creation and printing of advertising materials like brochures, mailers, business cards, etc.

Multimedia Advertising Expenses

This one is pretty self-explanatory, but it includes any ads on TV, cable or the radio. This also includes any air time purchased on podcasts or other audio-only channels.

Special Promotions

This is a catch-all category for anything promotion-related that you did throughout the year for your recruiting firm. This includes hosting seminars, webinars or workshops to promote your services, sponsoring a local event or even paying to have your logo on a local sports jersey, banner or brochure. 

If you ordered promotional swag for your clients or staff to promote your brand or to give out at a conference, it is also deductible, so keep track of those invoices.

Consultant or Marketing Agency Retainer

Any cost associated with hiring a consultant or marketing agency to conduct any of the campaigns above is also tax-deductible.

Marketing Expenses that ARE NOT Tax-Deductible

Even though there are many marketing tax deductions for recruiters, there are a few things that don't quite make the cut. These include the following:

• Advertising expenses associated with research and development activities
• The cost of putting up those advertisements you can deduct (like gas to drive your car around town while hanging flyers)
• Advertising as an Indirect Political Contribution (any publication or website used by or for a political party or candidate)
• Costs that are primarily personal or hobbies, even though some have promotional value (For example, inviting clients to your daughter’s wedding and trying to deduct wedding costs is a no-no.)
• Costs of personal hobbies carried on with business associates, like taking clients out to a sporting event

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If you have potential deductions included in these guidelines, check with your accountant to learn what tax deductions and filings are right for your recruiting firm. As for any of the marketing services listed above, Recruiters Websites can help with all of them. Our team is ready to make 2024 your best year yet. Let’s chat!