Deduct It!

by Fishman, Stephen

• ISBN13: 9781413317589
• ISBN10: 1413317588
• Edition: 9th
• Format: Paperback
• Copyright: 2012-11-30
• Publisher: Nolo

Summary

Business tax deductions, from start-up to success -- learn how to Deduct It! Completely updated for 2012returns! Understanding tax deductions is one of the keys to start-up success. Learn how to make more money for your small business by paying the IRS less -- let Deduct It!show you how to quickly maximize the business deductions you're legally entitled to. Learn how to make year-round business decisions that will pay off come tax time and avoid IRS problems with this comprehensive book. All the information you need is organized into practical categories featuring common deductions for small business owners, including: - start-up expenses - operating expenses - health deductions - vehicles - travel - entertainment - meals - inventory - equipment - and many more This edition is completely updated with all the latest tax information, eligibility requirements, and tax rates for 2012returns, including substantive updates to the law. Whether your business is just starting or well-established, Deduct It!is indispensable to your venture.

Author Biography

Stephen Fishman is the author of many Nolo books, including Nonprofit Fundraising Registration, Every Landlord's Tax Deduction Guide and Tax Deductions for Professionals, winner of the Publishers Marketing Association's Benjamin Franklin Award.

Table of Contents

Your Tax Deduction Companion	p. 1
Tax Deduction Basics	p. 5
How Tax Deductions Work	p. 6
How Businesses Are Taxed	p. 9
The Value of a Tax Deduction	p. 17
What Businesses Can Deduct	p. 21
Businesses That Lose Money	p. 25
Are You Really in Business?	p. 29
What Is a Business?	p. 31
Tax Consequences of Being a Hobbyist	p. 38
Income-Producing Activities	p. 40
Start-Up Expenses	p. 49
What Are Start-Up Expenses?	p. 50
Starting a New Business	p. 51
Buying an Existing Business	p. 54
Expanding an Existing Business	p. 55
When Does a Business Begin?	p. 56
Claiming the Deduction	p. 59
If Your Business Doesn't Last 15 Years	p. 60
Expenses for Businesses That Never Begin	p. 61
Organizational Expenses	p. 63
Avoiding the Start-Up Tax Rule's Bite	p. 64
Business Operating Expenses	p. 65
Requirements for Deducting Operating Expenses	p. 66
Operating Expenses That Are Not Deductible	p. 74
Tax Reporting	p. 76
Deducting Long-Term Assets	p. 77
What is a Long-Term Asset?	p. 79
Methods for Deducting Business Assets	p. 86
Rules for Deducting Any Long-Term Asset	p. 87
Section 179	p. 93
Bonus Depreciation	p. 104
Regular Depreciation	p. 108
Tax Reporting and Record Keeping	p. 123
Leasing Long-Term Assets	p. 125
Inventory	p. 129
What Is Inventory?	p. 130
Deducting Inventory Costs	p. 133
Maintaining an Inventory	p. 136
Determining the Value of Inventory	p. 138
Office Expenses	p. 143
Qualifying for the Home Office Deduction	p. 144
Corporation Employees	p. 157
Calculating the Home Office Deduction	p. 159
IRS Reporting Requirements	p. 173
Audit-Proofing Your Home Office Deduction	p. 175
Deducting an Outside Office or Workplace	p. 177
Car and Local Travel Expenses	p. 183
Deductible Local Transportation Expenses	p. 184
The Standard Mileage Rate	p. 195
The Actual Expense Method	p. 199
How to Maximize Your Car Expense Deduction	p. 215
Other Local Transportation Expenses	p. 217
When Clients or Customers Reimburse You	p. 217
Reporting Transportation Expenses on Schedule C	p. 218
Corporations, LLCs, and Partnerships	p. 220
Business Travel	p. 225
What Is Business Travel?	p. 226
What Travel Expenses Are Deductible	p. 234
How Much You Can Deduct	p. 236
Maximizing Your Business Travel Deductions	p. 249
How to Deduct Travel Expenses	p. 251
Travel Expenses Reimbursed by Clients or Customers	p. 254
Meal and Entertainment Expenses	p. 257
What Is Business Entertainment?	p. 258
Who You Can Entertain	p. 260
Deducting Entertainment Expenses	p. 260
Calculating Your Deduction	p. 266
Reporting Entertainment Expenses on Your Tax Return	p. 272
Hiring Workers	p. 275
Employees Versus Independent Contractors	p. 276
Tax Deductions for Employee Pay and Benefits	p. 280
Reimbursing Employees for Business-Related Expenditures	p. 290
Employing Your Family or Yourself	p. 296
Tax Deductions When You Hire Independent Contractors	p. 308
Retirement Deductions	p. 313
Why You Need a Retirement Plan (or Plans)	p. 315
Employer IRAs	p. 324
Keogh Plans	p. 326
Solo 401 (k) Plans	p. 328
Medical Expenses	p. 331
The Health Care Reform Act	p. 332
The Personal Deduction for Medical Expenses	p. 335
Deducting Health Insurance Costs	p. 336
Tax Credits for Employee Health Insurance	p. 345
Adopting a Medical Reimbursement Plan	p. 349
Health Savings Accounts	p. 357
Additional Deductions	p. 369
Advertising	p. 371
Business Bad Debts	p. 374
Casualty Losses	p. 380
Charitable Contributions	p. 384
Clothing	p. 386
Dues and Subscriptions	p. 387
Education Expenses	p. 387
Gifts	p. 390
Insurance for Your Business	p. 391
Interest on Business Loans	p. 393
Legal and Professional Services	p. 398
Taxes and Licenses	p. 400
Domestic Production Activities	p. 404
Record Keeping and Accounting	p. 409
What Records Do You Need?	p. 410
Records Required for Specific Expenses	p. 427
How Long to Keep Records	p. 440
What If You Don't Have Proper Tax Records?	p. 441
Accounting Methods	p. 442
Claiming Tax Deductions for Prior Years	p. 451
Reasons for Amending Your Tax Return	p. 452
Time Limits for Filing Amended Returns	p. 454
How to Amend Your Return	p. 457
How the IRS Processes Refund Claims	p. 458
Staying Out of Trouble With the IRS	p. 461
What Every Business Owner Needs to Know About the IRS	p. 462
Ten Tips for Avoiding an Audit	p. 469
Help Beyond This Book	p. 475
Secondary Sources of Tax Information	p. 476
The Tax Law	p. 483
Consulting a Tax Professional	p. 490
Index	p. 493
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