Expense Deductions for Taxes

[Cory]

Schesnut...great points all. If you have clients to your home office I know people that deduct for office furniture and other office items. I even saw an article in the newspaper where someone legitimately wrote off some of their landscaping for their home office. On the mileage, when I worked out of my home and pretty much just ran appointments you can write off most of your mileage (as I did keep records) and it will be fine with Uncle Sam. Turbo Tax (with the right version) does a great job with all the questions/deductions and you can do your taxes yourself if need be...their software will even wash your car for you - lol.

 

[padthaiforlunch]

Mileage- keep a log book in your car. If audited, that's the first thing they will ask for.

Meals- eating alone us deductible if you are away overnight. Otherwise, it needs to have a discussion about business.

 

[louiedoo]

You can also depreciate the car if you own it & it falls within IRS requirements, or write off a portion of the lease that's commesurate with % car is used for business.

 

[grod]

I know an agent who travels extensively. He writes off 40,000+ miles per year and has been doing that for years. Last year he was audited for his mileage. He keeps a detail log of where his appointment was and with whom he met and whether he wrote the business or not. The auditor dissallowed 10,000 miles, arbitrarily, and said that he must be using the car for personal business, eventhough he was not. No penalty just readjusted the taxes owed. He plans to submitt the full mileage again this year, which is about 40,000+ miles. He lives in a very rural area and drives two hours to his first appointment. He does very well.

 

[Norwayguy]

I know an agent who travels extensively. He writes off 40,000+ miles per year and has been doing that for years. Last year he was audited for his mileage. He keeps a detail log of where his appointment was and with whom he met and whether he wrote the business or not. The auditor dissallowed 10,000 miles, arbitrarily, and said that he must be using the car for personal business, eventhough he was not. No penalty just readjusted the taxes owed. He plans to submitt the full mileage again this year, which is about 40,000+ miles. He lives in a very rural area and drives two hours to his first appointment. He does very well.

He should be logging the mileage ie begining mileage and ending per day with the logs and he would have something to fight with...That and he has another vehicle he uses for personal use.

 

[grod]

He should be logging the mileage ie begining mileage and ending per day with the logs and he would have something to fight with...That and he has another vehicle he uses for personal use.

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He does keep a detailed mileage log, and he includes who he met with and if he wrote the business. He also showed the auditor that he has not one but two additional cars for personal use. The auditor said to him simply that he had too many miles and knocked off 10,000. Since they weren't raising issues with anything else, he let it go.

 

[Sawcruhteez]

Best advice is to talk to a CPA, if you work from home you can even deduct part of your rent as a home office expense.

 

[raven585]

When it comes to meals and entertainment, you should be deducting all of your meals while working and on the road. YOu can deduct 100% if you have detailed business receipts and who you met with etc. IF not, then you are allowed 50% of the total amount.