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If you use a portion of your home for business purposes, you may be able to take a home office deduction whether you are self-employed or an employee. Expenses that you may be able to deduct include the business portion of real estate taxes, mortgage interest, rent, utilities, insurance, depreciation, painting, and repairs. You can claim this deduction for the business use of a part of your home only if you use that part of your home regularly and exclusively:
Generally, the amount you can deduct depends on the percentage of your home that you use for business. Your deduction will be limited if your gross income from your business is less than your total business expenses. If you use a separate structure not attached to your home for an exclusive and regular part of your business, you can deduct expenses related to it. The rules vary depending on whether you’re self-employed, a qualified daycare provider, or storing business inventory or product samples. If you are an employee, you have additional requirements to meet. The regular and exclusive business use must be for the convenience of your employer. Call us if you want to explore deducting for the business use of your home. |
Posts Tagged ‘Business’
Deducting Your Home Office
Friday, July 15th, 2011Affordable Care Act Tax Provisions
Monday, July 19th, 2010|
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The Affordable Care Act was enacted on March 23, 2010. It contains some tax provisions that take effect this year and more that will be implemented during the next several years. The following is a list of provisions now in effect; more provisions are expected. |
Safeguard Your Tax Records from Disaster
Tuesday, July 13th, 2010|
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| Individuals and busnesses can safeguard their tax records from disaster by taking a few simple steps. (more…) |
Watch Out for IRS 401(k) Plan Questionnaires
Tuesday, June 22nd, 2010|
Daniel Weintraub, CPA, Partner |
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The Internal Revenue Service (IRS) has begun sending out questionnaires and letters to 1,200 randomly selected 401(k) plan sponsors. Employee Plan Examinations previously conducted by the IRS indicate that 401(k) plans are by far the most non-compliant plan type in the retirement plan universe. These plans have a significant impact on the health of private retirement in America and make up over 60% of the retirement plan universe.  It is important that they maintain the highest level of compliance possible: the Questionnaire is intended to assist the IRS in identifying compliance areas where additional education, guidance and enforcement are needed. |
Generating Professional Reports with QuickBooks
Tuesday, June 15th, 2010|
Chris Blach, QuickBooks ProAdvisor |
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 Let’s take a look. Reporting changed a lot between QuickBooks 2009 and 2010 in terms of interface, navigation, and access to reports. We’ll look at version 2010 since the core reporting mechanisms are similar, and wrap up with a brief summary of the new features in 2010.  (more…) |
How Long Should You Keep Your Tax Records?
Tuesday, June 8th, 2010|
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| Storing tax records: How long is long enough?
Spring is a great time to clean out that growing mountain of tax and financial papers that clutters your home and office. Here’s what you need to keep and what you can throw out without fearing the wrath of the IRS. Generally you to maintain copies of your tax returns and supporting documents for at least three years from the date you filed your return. This is called the “three-year rule ” and leads many people to believe they’re safe provided they retain their documents for this period of time. However, there are some exceptions. For example, if the IRS believes you have significantly underreported your income (by more than 25 percent ) it may go back six years in an audit. To be safe, use the following guidelines. (more…) |
Timeline for Tax Changes in Health Care Reform Legislation
Tuesday, June 8th, 2010|
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The Patient Protection and Affordable Care Act and the related Health Care and Education Reconciliation Act overhauls the U.S. health care system and affects nearly all taxpayers, many employers, and many elements of the health care industry. This massive overhaul contains a host of tax changes, many of which are both complex and novel. To compound the challenge, the tax changes go into effect over a number of years – ten if two retrocactvely effective tax changes are counted and nine if they are not.Â
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Below is a timeline of the tax changes and a concise summary of each new tax provision.
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Financial Planning Tips for May 2010
Tuesday, May 4th, 2010|
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When to Review Your Life Insurance Coverage It makes good financial sense to periodically examine your life insurance coverage to make sure the coverage is still sufficient. After all, life insurance is often a family’s most important financial and estate planning tool. With today’s frequent changes in financial circumstances and goals, it’s a good idea to re-examine your life insurance coverage on the occurrence of any of the following:
 A Slip of the Lip May Bring on a Tax Audit Many taxpayers have learned, to their dismay, that it generally isn’t wise to talk carelessly about their taxes – especially about sensitive areas. Why? Because the wrong person overheard their careless talk and “turned informer,” either for revenge or in the hope of an “informer’s reward.” An informer’s “tip” to the IRS will often trigger a tax audit. Even though the taxpayer has done nothing improper, he or she may have to suffer through the audit. Not only is this time-consuming, but it can also result in additional taxes due to the discovery of an innocent error on the return or the disallowance of a marginal deduction.
  Check Your Credit Report Order a copy of your credit report from one of the major credit reporting agencies. Read the report carefully and report any discrepancies to the appropriate agencies. This not only ensures that the records are accurate, but also helps prevent others from obtaining credit in your name.  Review Budget vs. Actuals Compare April income and expenditures with your budget. Make adjustments as appropriate to your May expenditures. Make sure you have invested your planned savings amount for April.  Make Withholding Adjustments Based on the results of your prior year’s tax return, make any necessary adjustments to your tax withholding by completing Form W-4 and giving it to your employer.
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Getting The Most From Auto Expenses
Monday, March 22nd, 2010|
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If you use a car for business, you have two choices for claiming deductions:
Which method is better?For some taxpayers, the standard mileage rate produces a larger deduction. Others fare better tax-wise by deducting actual expenses.
Generally, the standard mileage method benefits taxpayers who have less expensive cars or who travel a large number of business miles. How To Make the Most of Your Auto DeductionsKeep careful records of your travel expenses. We won’t be able to determine which of the two options is better for you if you don’t know the number of miles driven and the total amount you spent on the car. Furthermore, the tax law requires that you keep travel expense records and that you give information on your return showing business versus personal use. If you use the actual cost method, you must keep receipts.
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Tax Benefits For Employers Who Hire and Retain Unemployed Workers
Friday, March 19th, 2010|
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Two new tax benefits are now available to employers hiring workers who were previously unemployed or only working part time. These provisions are part of the Hiring Incentives to Restore Employment (HIRE) Act enacted into law March 18, 2010. Employers who hire unemployed workers this year (after Feb. 3, 2010 and before Jan. 1, 2011) may qualify for a 6.2-percent payroll tax incentive, in effect exempting them from their share of Social Security taxes on wages paid to these workers after March 18, 2010. This reduced tax withholding will have no effect on the employee’s future Social Security benefits, and employers would still need to withhold the employee’s 6.2-percent share of Social Security taxes, as well as income taxes. The employer and employee’s shares of Medicare taxes would also still apply to these wages. In addition, for each worker retained for at least a year, businesses may claim an additional general business tax credit, up to $1,000 per worker, when they file their 2011 income tax returns. The two tax benefits are especially helpful to employers who are adding positions to their payrolls. New hires filling existing positions also qualify but only if the workers they are replacing left voluntarily or for cause. Family members and other relatives do not qualify. In addition, the new law requires that the employer get a statement from each eligible new hire certifying that he or she was unemployed during the 60 days before beginning work or, alternatively, worked fewer than a total of 40 hours for someone else during the 60-day period. The IRS is currently developing a form employees can use to make the required statement. Businesses, agricultural employers, tax-exempt organizations and public colleges and universities all qualify to claim the payroll tax benefit for eligible newly-hired employees. Household employers cannot claim this new tax benefit. Employers claim the payroll tax benefit on the federal employment tax return they file, usually quarterly, with the IRS. Eligible employers will be able to claim the new tax incentive on their revised employment tax form for the second quarter of 2010.
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