Do You Really Need a Landline Phone?

landline phone off the hook

Photo by Miryam LeĂłn on Unsplash

Do You Really Need
a 
Landline Phone?

(And the expense
that goes with it?)

How Barbara cut her monthly telephone expenses from $117 to just $22 by switching her local and long-distance service from AT&T to her cable internet service provider.

 

As usual, it took me a while to “get it,” but one day I woke up and realized I no longer needed to be tethered to AT&T and could get everything I needed in the way of long-distance and local telephone service from my cable internet supplier.

Until mid-September, 2011, I had two landline phones; the residential phone my husband and I had installed when we moved into our home in 1989; the other, a business line added in 2000 when I opened my website and needed a separate line for doing business on the web. Through the years, it was a challenge to find the best long-distance rates for both lines, but things got better when AT&T began to offer affordable unlimited long-distance packages.

Do You Need a Separate Business Line to Be Legal?

For years I preached to my home business readers that the use of a residential telephone number for business purposes might be a violation of their local telephone company’s regulations. In 1984 when the first edition of Homemade Money was published, I learned that each state had a separate commission that determined the usage of a residential phone, so I cautioned my readers to check on this before putting a residential phone number on their business stationery, brochures, business cards, or website. In those years, it was common for a telephone company to impose a fine for improper use of a residential number, tell the customer to stop using it for business purposes, or simply start charging them business rates if they discovered a customer violating the rules.

Long after I no longer needed two phone lines, I kept my business line because I wanted to operate legally. But rates that were once $50 inched up to $72/month over the years, and I finally decided this was just too much expense on top of my residential phone bill of $45/month when I was the only one using a phone.

When Things Changed

The turning point came on a day in 2011 when I had some line trouble and spoke with the AT&T repairman about the legality of canceling my business line and just using my home phone number on my website as a contact number. He laughed and said that a separate business line used to be the law, but then with so many people working at home and doing business on the web, AT&T had better things to do than worry about work-at-homers who were using a cell phone or their residential number for both personal and business use. And putting a home phone number on a website that didn’t sell products, he said, would be insignificant to them.

What AT&T and other landline telephone companies are most concerned about now is the competition from cable internet companies that are offering terrific bundled cable/internet/phone service packages, plus services such as Magic Jack, Skype, and other VoIP (voice over IP) services that use one’s internet connection and computer to make free phone calls through a USB port.

I once had two landline phones, DirecTV® for my cable service, and internet service from WowWay (Wow!). When this company was bought by RCN/Astound in late 2021, I stayed with them and enjoyed my Wow! bundled price until mid-2023 when my contract with Wow! expired and I was moved into the new service provider’s program with a higher monthly package cost. 

The cable portion of my package has gotten very pricey, but I love that I can record six programs at the same time while watching another. And my phone, which used to be $20/month is now just $22. But there is one drawback. When you get your long-distance service through a cable internet provider, your telephone calls are not itemized. That means there is no way to know who you called, or when you made a call unless you keep a record of the numbers called. So if you’re going to use a cable service provider for your business long-distance needs, you may want to keep a record of calls made to business contacts (which won’t be easy to remember to do). Another thing to consider is the tax deductibility of whatever phone number you choose to use for your business.

Remember, too, that when you give up your landline phone for a cable phone, you will be rendered “phoneless” if the power fails or your provider’s service goes down in a storm. I use my mobile phone primarily for texting, but many times I’ve been grateful to have my mobile phone as my emergency backup phone.

Tax Deductibility of Cable Internet Phone Expenses

If a single phone line (whether land, cable, or cell) is being used for both business and personal calls, historically the IRS has wanted to see a record of every phone call (not possible with internet service providers) or an appropriate breakdown of how much of the phone expense is personal and how much is business. My accountant confirmed that if you’re turning an old landline phone number in your home into your home office telephone and adding it to your internet cable service package, you can deduct the full amount of the internet service provider’s bill so long as you also have another telephone number (mobile phone) that can be considered your personal phone.

 If you use your mobile phone for both personal and business purposes, to get a business deduction you’d need to calculate what percentage of the cost is related to business use of the phone. (See below for links to web articles that offer additional insight into the tax deductibility of different types of telephone and cable services.)

Landlines vs. Internet Cable Phone Services

When I realized that my phone calls would now be going out over the internet, I remembered all the complaints I’d heard about the quality of phone services provided by Magic Jack, Skype, and other VoIP providers and wondered about the quality I’d get with my internet cable provider. I learned that the main difference between the two is that cable companies are the primary providers of the service, whereas all the VoIP providers are using a third-person provider, which naturally affects the quality of the calls and the reliability of the service as a whole.

The problem here for many, however, is that they live in the wrong place. In large cities with skyscrapers, it may be hard to get a cell phone signal at times. And if you live out in the country, there may be no satellite signal for a cell phone, no cable company serving that area, and no high-speed internet provider to work with. Folks in rural areas do have a couple of options, however, through HughesNet and Viasat Internet (formerly Wild Blue Satellite Internet). And here’s info about the top five VoIP providers in 2024.

Something I didn’t know until I spoke with a salesperson at Wow! was that, technically, I own the telephone wires in my home, and that what my local telephone company was charging me for in the past was service on the line running from my house to the pole out there on the street somewhere that connects to their services. But now that line is connecting me to my cable company, and while calls are going out over the internet, they are running through the existing telephone lines in my home instead of my computer. (If anything goes wrong with the lines in my home, fixing them will be at my expense.)

Do You Know Who Has Your Number and
Where It Is Appearing on the Web?

In making a list of all the places on the internet where I needed to change my telephone number for business reasons, I was astonished to find that it was appearing in connection with my name on more than 3,000 pages, from white pages, yellow pages, Superpages, and allpages to countless other listings on various city and state sites that provide business telephone numbers and reverse number look-up sites. Of course, NONE of these listings were authorized by me.

Never having searched for my telephone numbers before, I had no idea that my personal name, business name, website, and business telephone number were appearing on so many directory-listing sites. This is just an example of how robots crawl the internet and pick up information about us. Many of the listings for my name included a P.O. address I stopped using in 1989. Others showed my home address, and most of these listings linked to a map with directions to my front door, something I got off Google a long time ago, but which soon seemed to have been a waste of time.

When I first published this article on my former domain, I had no idea what would happen when I had one of my landline phone numbers imported to a cable company service provider, but a search as I was updating this article in 2021 made me feel a whole lot better. Whereas I originally found some 3,000 listings connecting my name to my current phone number, this year I found only five listings out of the 15 Google selected to display with my name and number together. A total of 1,900 pages apparently contain that phone number, but they are no doubt from paid search services offering to trace people whose number began with the first six digits only. This suggests to me that having my phone service with my ISP has afforded me some privacy on the internet that I didn’t have before. (I still get a LOT of junk phone calls every day, but at least I can identify the caller before I answer.)

Related Article:

What Time is It on Your Cell Phone? A little levity for time-challenged home-business owners.

Maximizing Schedule C Deductions and Working with an Accountant. Waiting until the last minute in April to think about your tax situation is a BIG mistake.

Related Articles on the Web

These articles offer insight into the tax deductibility of different types of telephone and cable services:

• Deducting Telephone Expenses for Your Home Office (Scroll down for the phone deduction.)

• Are Internet, Cable & Phone Write-Offs for a Small Business?

• How Much of My Internet Expenses Are Deductible on My 1040?

First published in 2011, updated in 2017, 2021, and 2024.

Back to
Home Business T/C

Money Matters T/C

All Articles T/C

Home

Leave a Reply

Your email address will not be published. Required fields are marked *