Purported Social Media Influencer Deductions Denied: Business Expense or Personal Spending?
Social media has blurred the line between business and everyday life.
For a content creator, a concert can become content. A vacation can become a video. A new product can become a review. Even dinner, clothing, entertainment, or a celebrity meet-and-greet might end up on Instagram, TikTok, or YouTube.
But there is an important tax lesson creators need to understand:
Creating content about an expense does not automatically turn a personal expense into a business deduction.
A recent U.S. Tax Court case involving an individual who claimed to operate as a social media influencer provides a good example.
The Case: Sami v. Commissioner
Suleiman Sami worked as an information technology manager at JetBlue and also operated a chauffeur business and a ticket-resale business, while building a significant social media presence.
According to the Tax Court, as of October 23, 2025, Sami had approximately:
520,000 followers on TikTok
140,000 followers on Instagram
4,200 followers on X
However, the record was clear not clear as to how many followers he had during the years at issue. The Court also noted that during the years at issue, he did not earn any such shared advertising revenue from social media.
During 2019 through 2021, he spent substantial amounts on exclusive entertainment experiences, including attending the Grammys and Emmys and participating in celebrity meet-and-greets with actors such as Matt Damon, Benedict Cumberbatch, and Mark Ruffalo.
He originally reported many of those expenditures as charitable contributions. During the Tax Court case, however, he argued that the expenditures should instead be deductible as marketing expenses associated with his social media activity.
The Tax Court wasn't convinced.
The Court recognized that a legitimate social media influencer can operate a trade or business and that influencer-related marketing expenses can potentially qualify as business deductions.
But that wasn't enough.
The Tax Rule:
Ordinary and Necessary
Business Expenses
Internal Revenue Code Section 162 generally allows taxpayers to deduct ordinary and necessary expenses paid or incurred in carrying on a trade or business.
Generally:
An ordinary expense is one that is common and accepted in the taxpayer's trade or business.
A necessary expense is one that is appropriate and helpful to the business.
Content creators are entitled to legitimate business deductions just like any other business owner.
But Section 162 does not override the general rule that personal expenses are not deductible.
The Court Wasn't Persuaded by the “Other Influencers Do It” Argument
Sami made an argument that probably sounds familiar to many creators.
He argued that these kinds of expenditures are normal in the influencer industry.
For example, he pointed to Disney-focused influencers who pay to attend movie premieres so they can post photos and videos from the event and potentially generate income from that content.
The Tax Court essentially responded: That may be true—but it still doesn't solve your problem.
Even if an expense is common in the influencer industry and therefore potentially “ordinary,” Section 162 still requires the expense to have been incurred primarily for business purposes.
The Court concluded that Sami had not established that.
That distinction is important.
An expense can be common in your industry and still be nondeductible if the primary reason you incurred it was personal.
So the question isn't simply:
“Do influencers normally spend money on this?”
It is also:
“Why did you personally spend the money?”
Then the Court Went Even Further
The Court did not stop after finding that Sami's expenses were not incurred primarily for business purposes.
It explained that even if Sami had cleared that hurdle, he still had several additional problems.
That is what makes this case particularly useful for creators.
Problem #1: What Business Were the Expenses Actually Connected To?
During the years before the Court, Sami had several different income-producing activities.
But the Court had difficulty connecting the claimed marketing expenses to any of them.
For example, Sami had not received payments from social media companies during the tax years at issue.
He also argued that some of his celebrity interactions could help his driving business. But the Court noted that because he did not have the required TLC license, he could only drive people he personally knew. That significantly weakened the argument that celebrity interactions were meaningful marketing for that business.
The Court also found that Sami had not shown that the expenses increased his ticket-resale business because he did not provide written evidence of ticket sales connecting the expenditures to that activity.
That left his future social-media revenue as perhaps the strongest possible business connection.
But that created another problem.
Problem #2: Were These Actually Startup Costs?
The Court noted that Sami was not yet receiving social-media revenue during the tax years at issue.
That means that even if some of these expenses were genuinely incurred to build a future monetized social-media business, they might not have been immediately deductible under Section 162.
Instead, they could potentially have been startup expenditures under Section 195.
Startup expenses generally arise before a taxpayer actually begins carrying on the trade or business.
Those expenses are subject to a different set of rules and may need to be capitalized rather than deducted immediately as ordinary business expenses.
In other words, Sami faced a problem either way.
If the expenses were primarily personal, they were not deductible.
If they really were expenses incurred to create a future social-media business that had not yet begun operating, they might have been startup costs rather than current business deductions.
The Court noted that resolving that issue would require considerably more legal analysis than Sami provided.
And Then There Was the Documentation
Even if Sami had overcome all of those legal hurdles, he still had a basic tax-return problem:
He could not adequately substantiate many of the expenses.
Much of his evidence consisted of lines from credit card and bank statements coupled with general statements that he had spent money to promote his businesses.
That was not enough.
The Court highlighted one 2021 expense in particular:
A $1,661.57 Ticketmaster charge appeared on Sami's credit card statement.
Sami classified the transaction as a “marketing event.”
But there was no receipt explaining what the ticket was for, no detailed description of the event, no testimony specifically connecting that purchase to business activity, and no evidence showing social-media posts resulting from the expenditure.
The Court emphasized an important distinction:
Putting “marketing event” on a tax filing does not prove that the expense was a marketing expense.
A taxpayer's assertion is not the same thing as evidence.
Other transactions had even less support.
For example, some roughly $1,000 expenditures were identified only as PayPal transactions with usernames and transaction numbers.
That did not tell the Court what was purchased, why it was purchased, or how it related to a business.
As a result, the Court concluded that Sami had not sufficiently substantiated the claimed marketing-event expenses.
What Content Creators
Should Learn From This
Before claiming an unusual creator expense, you should be able to answer four separate questions:
1. Was the expense primarily business-related?
Creating content from an activity does not necessarily mean the activity was undertaken primarily for business.
2. What existing business did the expense benefit?
Be able to identify the actual trade or business the expense relates to and explain how it helps generate revenue.
3. Had that business actually started yet?
If you are spending money to build a business that has not yet begun operating, different startup-cost rules may apply.
4. Can you prove what you actually purchased?
A credit card charge proves that money left your account.
It does not prove what you purchased or why the purchase was a deductible business expense.
For expenses, keep more than a bank statement.
Keep the receipt, invoice, event information, business purpose, related contracts, and, where appropriate, the actual content produced from the expense.
Consider a Simple Example
Example 1: Primarily Personal
You book the trip because you want a vacation.
While you are there, you decide to film some content.
The fact that you created content during the trip does not necessarily transform the trip into business travel.
Example 2: Primarily Business
A hotel hires you to create a sponsored campaign.
You travel specifically to photograph and film the property.
You have a written agreement identifying your deliverables.
You spend your time producing the content required by the contract.
You publish the agreed-upon campaign and receive payment.
Those facts look much more like a legitimate business trip.
Same destination.
Very different tax facts.
Need Help Sorting Business Expenses From Personal Expenses?
Creator businesses can raise tax issues that do not come up nearly as often in traditional businesses.
Sharp Tax & Accounting helps self-employed individuals and business owners identify legitimate deductions, improve their recordkeeping, and take tax positions that can actually be supported if the IRS asks questions.
If you are earning income from social media, sponsorships, content creation, or another side business, it may be worth reviewing your expenses before tax season rather than trying to sort everything out after the year is over.
This article provides general tax information and is not intended as individualized tax, legal, or financial advice. Tax treatment depends on the specific facts and circumstances of each situation.