Can I Deduct Business Bank Fees? A Guide for Lubbock Small Business Owners

Quick answer: Fees your bank charges on an account you use for your business are deductible business expenses. That includes monthly maintenance fees, overdraft and ATM fees, wire fees and business credit card annual fees. Fees on a personal account you also use for business only count for the business share, which is why a separate business account matters.

Business bank fees at a glance

• What qualifies: Fees on business checking, savings and business credit cards
• Limit or percentage: 100% of business-account fees; business share only on mixed accounts
• Records to keep: Monthly bank and card statements showing each fee

What counts as a deductible bank fee

• Monthly maintenance or service fees
• Overdraft and returned-item fees
• ATM and out-of-network fees
• Wire transfer and stop-payment fees
• Business credit card annual or membership fees
• Late fees charged by a bank or vendor on business bills

What doesn't count

• Fees on a purely personal account
• IRS or state penalties and interest on taxes
• Loan setup costs, which are usually spread over the life of the loan rather than deducted all at once

How to gather your bank fee records

1. Download all 12 monthly statements for every business checking, savings and credit card account.
2. Search each statement for the word "fee" and highlight every charge.
3. Mark mixed-use accounts. If you run business through a personal account, note which fees relate to business activity.
4. Pull loan closing documents for any business loan you took out during the year.

How to organize and bring your data to Hub City Tax Pros

1. List each account on one page with its total fees for the year.
2. Keep fees and loan setup costs on separate lines.
3. Bring the summary page and the year-end statements to our Lubbock office.
4. Bring loan closing papers so we can figure what part of setup costs applies this year.

Common mistakes

• Mixing business and personal spending in one account, which makes every fee harder to support
• Missing small fees buried on credit card statements
• Deducting the full loan setup cost in year one

Frequently asked questions

Are business checking account fees tax deductible?

Yes. Fees on an account used for your business are ordinary business expenses.

Can I deduct overdraft fees?

Yes, when they're charged on your business account.

Is my business credit card annual fee deductible?

Yes, if the card is used for your business.

Bring your records to Hub City Tax Pros

Bring your bank statements to Hub City Tax Pros. Walk in or call (806) 810-5798. Our CPAs and IRS Enrolled Agents at 4414 82nd St., Suite 214, Lubbock, TX 79424 (The Village Shopping Center) will review your numbers, make sure every eligible dollar counts, and file your 1040 with transparent pricing. Locally owned in Lubbock, not a franchise. No appointment needed during tax season. Real tax pros. Real prices. Right here on 82nd.

This article is general information for tax year 2026, not tax advice for your situation. Tax rules change; bring your records in and we'll apply the rules that fit you.