Small Business
The most frequently asked tax questions related to Small Business
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Answer Tax QuestionsTax preparation fees
Asked Saturday, September 23, 2000 by an anonymous user
Tax preparation and audit fees are deductible. A portion of these fees may be allocated to the individual's business tax forms (Schedule(s) C,E,F) or as an itemized deduction on Schedule A subject to the 2% limitation.
Commissions earned, but not yet paid
Asked Friday, September 22, 2000 by an anonymous user
Generally, for cash basis taxpayers, Form 1099-Misc will be issued for the amount paid. Accrual basis entities will pay tax on commissions earned.
Commissions earned are taxable in the year earned and credited to your account and subject to your drawing, regardless if you actually drew that amount out of the account or not.
Commissions earned are taxable in the year earned and credited to your account and subject to your drawing, regardless if you actually drew that amount out of the account or not.
Performing Artist
Asked Friday, September 22, 2000 by an anonymous user
If you meet the criteria for a "performing artist", you may use your business deductions to arrive at an adjusted gross income.
The deductions are not considered an itemized deduction, but rather as an offset against adjusted gross income. Speak to your local CPA to determine if you meet the criteria for a "performing artist" and whether you can take advantage of this income offset reportable on IRS Form 2106.
The deductions are not considered an itemized deduction, but rather as an offset against adjusted gross income. Speak to your local CPA to determine if you meet the criteria for a "performing artist" and whether you can take advantage of this income offset reportable on IRS Form 2106.
Dues and Subscriptions - Deductibility
Asked Friday, September 22, 2000 by an anonymous user
Generally, union, professional society, trade association, booster club, Chamber of Commerce dues are deductible as an itemized deduction subject to the 2% AGI limitation on IRS Schedule A.
Voluntary payments to a union unemployment strike or benefit fund are not deductible.
Costs for running for a union office are not deductible.
Job related subscriptions to professional journals and trade magazines are deductible as an itemized deduction subject to the 2% AGI limitation on IRS Schedule A.
Voluntary payments to a union unemployment strike or benefit fund are not deductible.
Costs for running for a union office are not deductible.
Job related subscriptions to professional journals and trade magazines are deductible as an itemized deduction subject to the 2% AGI limitation on IRS Schedule A.
Uniform - Cleaning
Asked Friday, September 22, 2000 by an anonymous user
If you can claim the expense of purchasing uniforms or special work clothes, then the cleaning, laundering, and repair of those items are also deductible as an itemized deduction subject to the 2% AGI limitation on IRS Schedule A.
Cell phones
Asked Friday, September 22, 2000 by an anonymous user
Cellular phone equipment (similar to computers) must be used for the "convenience of the employer" and be a "condition of employment" for the taxpayer in order for it to be fully expensed or for the cellular phone costs to be depreciated.
Condition of employment means you cannot properly do your job without it.
You may write off the cost under the first year expensing rule or use a 5 year MACRS life for depreciation.
Condition of employment means you cannot properly do your job without it.
You may write off the cost under the first year expensing rule or use a 5 year MACRS life for depreciation.
Tools
Asked Friday, September 22, 2000 by an anonymous user
If you purchase your own small tools for use on your job and they are not reimbursed from your employer, you may deduct the cost as an itemized deduction subject to the 2 % limitation on Schedule A.
If the tools have an expected useful life of more than one year, then the costs should be depreciated or the first year expense election may be taken.
If the tools have an expected useful life of more than one year, then the costs should be depreciated or the first year expense election may be taken.
Telephone - job related
Asked Friday, September 22, 2000 by an anonymous user
You may not deduct any part of the standard monthly charge for the first telephone line into your home.
If you have more than one line which is used for business, the costs are fully deductible.
The costs will include phone rentals, business long distance calls, and optional services such as call forwarding and call waiting.
To avoid possible problems with the IRS, it is suggested that you maintain separate business and personal phone lines.
If you have more than one line which is used for business, the costs are fully deductible.
The costs will include phone rentals, business long distance calls, and optional services such as call forwarding and call waiting.
To avoid possible problems with the IRS, it is suggested that you maintain separate business and personal phone lines.
Suits & Dresses - cleaning
Asked Monday, September 11, 2000 by an anonymous user
The costs of buying and maintaining clothing that can be considered suitable for street wear are not deductible.
The costs of buying and maintaining Uniforms or work clothes not suitable for street wear are deductible. Uniforms for police or fireman are examples of uniform itemized deductions.
The costs of buying and maintaining Uniforms or work clothes not suitable for street wear are deductible. Uniforms for police or fireman are examples of uniform itemized deductions.
