What are office supply categories?
Office supplies are short-term, consumable items used for daily operations. They’re categorized as operating expenses and are fully deductible in the year purchased or used for business.
What are office supplies?
Office supplies include the materials and small tools your business uses to perform daily administrative tasks. These are typically inexpensive, used up within a year, and necessary for smooth operations. They differ from office equipment (like computers or printers) because supplies don’t have lasting value or a long useful life.
How to categorize office supplies
- Record as Operating Expenses in your income statement.
- Use an “Office Supplies” account in your chart of accounts (often under Administrative or General Expenses).
- Expense supplies as they’re used or when purchased if they’re typically consumed within 12 months.
- Keep receipts and purchase records for accurate expense tracking.
- Exclude durable or high-value items (e.g., furniture, electronics) — those should be categorized as fixed assets.
Examples of office supplies
- Pens, pencils, paper, and notebooks.
- Printer ink, toner, and copy paper.
- Envelopes, stamps, and mailing supplies.
- Folders, binders, and filing materials.
- Desk organizers, tape, and staplers.
- Cleaning and breakroom supplies (coffee, paper towels, etc.).
- Small décor or incidental office materials.
Tax implications for office supplies
- Office supplies are fully tax-deductible as ordinary and necessary business expenses.
- Deduct supplies in the year they are purchased (cash-basis) or used (accrual-basis).
- Supplies that last longer than one year or exceed your capitalization threshold (often $2,500) should be capitalized as assets.
- Home-based businesses can also deduct office supplies used exclusively for business.
- Maintain documentation (receipts, invoices, usage logs) to substantiate deductions if audited.
