Are eval fees a business expense?

The honest framing first

You will find plenty of forum posts stating flatly that "eval fees are deductible." We're not going to tell you that, because whether a cost is deductible depends on facts about your activity that only a tax professional, looking at your whole situation, can weigh. What we can do is explain the standard they apply and the questions they'll ask — so the conversation is productive.

The IRS standard: "ordinary and necessary"

Business expenses are governed by a single well-known standard: to be deductible, a cost generally has to be ordinary and necessary to carrying on a trade or business (this is IRC §162, summarized in IRS Publication 334). "Ordinary" means common and accepted in your line of work; "necessary" means helpful and appropriate.

The load-bearing phrase is "trade or business." Whether your prop-trading activity rises to that level — versus a hobby or an investment activity — is the exact question a CPA evaluates, and it's why there's no blanket yes/no.

The costs traders commonly discuss with a CPA

These are the line items that come up most often. We list them as topics to raise, not as a list of write-offs:

• Evaluation and reset fees — what you paid the firm for attempts.
• Platform and data subscriptions — charting, market data, execution platforms.
• Hardware used for trading — monitors, a dedicated machine.
• Home-office costs, where a trader qualifies.
• Education directly related to the activity.

A CPA will want to know how consistent and business-like the activity is, whether you're funded, how you keep records, and what your intent is. Those facts — not the category label — decide the treatment.

Keep the record; let the CPA decide the treatment

The one thing that is unambiguously in your control is documentation. Whatever your CPA concludes, they need clean totals: every eval fee and reset, dated, with amounts. Reconstructing that in April from card statements is miserable and error-prone.

The TradersGuild Eval Ledger keeps a running total of what you've spent on attempts and its Tax Season Export hands your CPA a tidy, dated figure — a bookkeeping record, not a determination that anything is deductible.

What we deliberately don't do

TradersGuild does not compute your tax owed, map anything to a specific line on a return, or tell you a cost is deductible. That's the advice line, and it belongs to a CPA — a trader-focused one (like the resources at Green Trader Tax) if your situation is at all involved.