Deductions and Write-Offs

Dues paid to trade associations, community booster clubs, chamber of commerce's like the Lions club are deductible as an miscellaneous itemized deduction on IRS Schedule A subject to the 2% MAGI limitation.

Yes. Dues paid to trade associations, community booster clubs, chamber of commerce's like the Rotary club are deductible as an miscellaneous itemized deduction on IRS Schedule A subject to the 2% MAGI limitation.

Generally, the IRS requires 2 types of records for substantiation. You should maintain a diary (calender diary recommended)or account book to list the place, time, who you met with, and the business purpose of your travel and entertainment. Receipts, itemized bills or similar statements for lodging are needed regardless of the amount.For other expenses of $75 or more a receipt is needed. A bill should show the amount of the expense, the date of the expense, where the expense was incurred and the nature of the expense.

No. As a cash basis taxpayer you cannot claim a bad debt loss for salary that was earned but not paid to you.

Individuals who make charitable contributions to charitable organizations in excess of the deductable 50%,30%,20% AGI ceiling for the tax year may carry this excess deduction forward for a period of 5 years.

Taxpayers are entitled to deduct any expenses for using their homes for business purposes if the expenses are attributable to a portion of the home or separate structure used Exclusively and On A Regular Basis as the principal place of any business carried on by the taxpayer (occasional use is not sufficient) or a place of business that is used by clients, customers, patients, in meeting or dealing with the taxpayer in the normal course of business. If the taxpayer is an employee, the business use of the home must also be for the convenience of the employer. A home office deduction may be claimed if the taxpayer regularly and exclusively uses part of the home for conducting the administrative or management activities of the business. Home office expenses may include real estate taxes, mortgage interest and operating expenses such as insurance and utilities and also depreciation. Home office deductions may be limited. The allowed deduction is calculated and reported on IRS Form 8829 and then transferred to the taxpayers Schedule C. There are certain tax consequences of claiming a office in the home deduction. A consequence occurs when the taxpayer sells his residence. Current law allows a $500,000 exclusion on the sale of a residence ($250,000 for non joint returns). If a residence is sold with a home office, the gross sales price must be apportioned over the residence and the business office. A taxable gain on the sale may occur. If a residence is sold without a home office the full exclusion may be taken. Some CPA's suggest not claiming a office in your home for the two years prior to the sale of the residence. Speak to your local CPA about your specific circumstances to work out a strategy that works for you.

Uniform Transfer to Minors and Gift to Minors accounts are custodial accounts set up in a child’s name. There are no income eligibility limits to set up an account. Contributions are not tax deductible.
You may put up to $14,000 a year without any gift tax consequences.
As the custodian you have the choice to invest the money in any investment you choose. The current year tax consequences are that the first $1000 of the investment earnings is tax free; the next $1000 will be taxed at the child’s tax rate.
Any earnings above $2,000 will be taxed at the parent’s rate until the child is 18 years of age. After 18 the earnings are taxed at the child’s rate. An important item to note with these custodial accounts is that the account belongs to the child.
The child gains full control of the Uniform Gift account at age 18 and gains control of the Uniform Transfer account at age 21. Speak to your local CPA for more information on these custodial accounts.

Costs incurred in entertaining customers, prospective customers, clients, suppliers, employees and other business associates are valid business expenses that are subject to conditions and restrictions.
For entertainment costs to be deductible, the following must be documented; the time, place and the nature of the entertainment, a description of the business purpose involved, the amount of each separate expense, the business relationship and identification of the persons entertained.
A calendar diary is recommended to maintain this information.

The first year limit for cars placed in business service in the current year is $11,160, if you elect the special depreciation allowance for qualified passenger auto's.