Can I Deduct Credit Card Interest?

Credit card interest adds up quickly, and many people wonder if they can at least write it off on their taxes. Personal credit card interest is not deductible on your federal tax return, a rule that has been in place since 1986. However, if you use a credit card for business expenses and carry a balance, the interest attributable to those business charges is deductible as a business expense. If you mix personal and business purchases on the same card, you need to allocate the interest proportionally based on the types of charges. Using a dedicated business credit card makes this much simpler and keeps the business interest clearly documented.