Tax Deductions for Professionals

by Fishman, Stephen

• ISBN13: 9781413307825
• ISBN10: 1413307825
• Edition: 3rd
• Format: Paperback
• Copyright: 2007-12-15
• Publisher: Nolo

Summary

If you're a licensed professional, turn to the only book that helps you get the unique tax deductions you're due!

Author Biography

Stephen Fishman received his law degree from USC. Mr. Fishman has extensive experience in both the private and public sectors and has been writing professionally for over 23 years. His other books include Deduct It!, Every Landlord's Tax Deduction Guide and Home Business Tax Deductions and many other legal and small business books. Mr. Fishman lives in the San Francisco Bay Area.

Table of Contents

Your Tax Deduction Companion	p. 1
Tax Deduction Basics
How Tax Deductions Work	p. 6
The Value of a Tax Deduction	p. 9
What Professionals Can Deduct	p. 12
Choice of Business Entity
Types of Business Entities	p. 19
Limiting Your Liability	p. 26
The Four Ways Business Entities Are Taxed	p. 33
Comparing Tax Treatments	p. 39
Should You Change Your Business Entity or Tax Treatment?	p. 63
Operating Expenses
Requirements for Deducting Operating Expenses	p. 70
Operating Expenses That Are Not Deductible	p. 75
Tax Reporting	p. 76
Meal and Entertainment Expenses
What Is Business Entertainment?	p. 80
Who You Can Entertain	p. 81
Deducting Entertainment Expenses	p. 82
Calculating Your Deduction	p. 86
Expenses Reimbursed by Clients	p. 91
Car and Local Travel Expenses
Deductible Local Transportation Expenses	p. 94
The Standard Mileage Rate	p. 99
The Actual Expense Method	p. 101
Other Local Transportation Expenses	p. 113
Reporting Transportation Expenses on Schedule C	p. 114
When Clients Reimburse You	p. 115
Professionals With Business Entities	p. 115
Long Distance Travel Expenses
What Is Business Travel?	p. 122
What Travel Expenses Are Deductible	p. 127
How Much You Can Deduct	p. 129
Maximizing Your Business Travel Deductions	p. 139
Travel Expenses Reimbursed by Clients	p. 142
The Home Office Deduction
Qualifying for the Home Office Deduction	p. 146
Calculating the Home Office Deduction	p. 158
How to Deduct Home Office Expenses	p. 167
Audit-Proofing Your Home Office Deduction	p. 171
Deductions for Outside Offices
If You Rent Your Office	p. 174
If You Own Your Office	p. 177
If You Lease a Building to Your Practice	p. 187
Deducting Long-Term Assets
Long-Term Assets	p. 191
Section 179 Deductions	p. 194
Depreciation	p. 204
Tax Reporting and Record Keeping for Section 179 and Depreciation	p. 226
Leasing Long-Term Assets	p. 228
Start-Up Expenses
What Are Start-Up Expenses?	p. 234
Starting a New Practice	p. 235
Buying an Existing Practice	p. 237
Expanding an Existing Practice	p. 238
When Does a Professional Practice Begin?	p. 239
How to Deduct Start-Up Expenses	p. 241
Organizational Expenses	p. 244
Medical Expenses
The Personal Deduction for Medical Expenses	p. 249
Self-Employed Health Insurance Deduction	p. 250
Deducting Health Insurance as an Employee Fringe Benefit	p. 253
Adopting a Medical Reimbursement Plan	p. 258
Health Savings Accounts	p. 264
Retirement Deductions
Why You Need a Retirement Plan (or Plans)	p. 280
Types of Retirement Plans	p. 285
Individual Retirement Accounts-IRAs	p. 286
IRAs for Businesses	p. 291
Qualified Retirement Plans	p. 295
Keogh Plans	p. 298
Solo 401(k) Plans	p. 299
Roth 401(k) Plans	p. 300
Inventory
What Is Inventory?	p. 302
Do You Have to Carry an Inventory?	p. 305
Deducting Inventory Costs	p. 306
IRS Reporting	p. 308
More Deductions
Advertising	p. 313
Business Bad Debts	p. 315
Casualty Losses	p. 321
Charitable Contributions	p. 323
Clothing	p. 325
Disabled Access Tax Credit	p. 326
License Fees, Dues, and Subscriptions	p. 327
Education Expenses	p. 328
Gifts	p. 331
Insurance for Your Practice	p. 331
Interest on Business Loans	p. 333
Legal and Professional Services	p. 336
Taxes	p. 337
Domestic Production Activities	p. 341
Hiring Employees and Independent Contractors
Employees Versus Independent Contractors	p. 346
Tax Deductions for Employee Pay and Benefits	p. 350
Reimbursing Employees	p. 356
Employing Your Family	p. 358
Tax Deductions When You Hire Independent Contractors	p. 367
Professionals Who Incorporate
Automatic Employee Status	p. 372
Paying Yourself	p. 374
Employee Fringe Benefits	p. 386
Shareholder Loans	p. 394
How You Pay Business Expenses
Your Practice Pays	p. 398
Using Personal Funds to Pay for Business Expenses	p. 400
Your Client Reimburses You	p. 407
Accountable Plans	p. 409
Amending Tax Returns
Reasons for Amending Your Tax Return	p. 414
Time Limits for Filing Amended Returns	p. 415
How to Amend Your Return	p. 416
How the IRS Processes Refund Claims	p. 418
Staying Out of Trouble With the IRS
Anatomy of an Audit	p. 420
The IRS: Clear and Present Danger or Phantom Menace?	p. 422
How Tax Returns Are Selected for Audits	p. 423
Tax Shelters, Scams, and Schemes	p. 426
Ten Tips for Avoiding an Audit	p. 430
Record Keeping and Accounting
Recording Your Expenses	p. 436
Documenting Your Deductions	p. 438
Accounting Methods	p. 457
Tax Years	p. 463
Help Beyond This Book
Secondary Sources of Tax Information	p. 466
The Tax Law	p. 472
Consulting a Tax Professional	p. 478
Index	p. 481
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