Deduct It! Lower Your Small Business Taxes

By Attorney Stephen Fishman, Nolo Press

Features:

From start-up to success, you need to Deduct It!

The fastest way for any small business to make more money is to pay less to the IRS. Let Deduct It! show you how to maximize the business deductions you're entitled to -- quickly, easily and legally.

Comprehensive -- yet easy to read with many interesting and relevant examples -- the book is organized into practical categories featuring common deductions, including:

• start-up expenses
• operating expenses
• health deductions
• vehicles
• travel
• entertainment
• meals
• inventory
• equipment
• and many more

Table of Contents

Introduction: How to Use This Book

• A. Who Can Use This Book
• B. Why You Need to Know About Tax Deductions
• C. The Ever-Changing Tax Laws
• D. Icons Used in This Book

1. Tax Deduction Basics

• A. How Tax Deductions Work
• B. How Businesses Are Taxed
• C. The Value of a Tax Deduction
• D. What Businesses Can Deduct

2. Beating the Hobby Loss Rule

• A. What Is a Business?
• B. Tax Consequences of Being a Hobbyist
• C. Income-Producing Activities

3. Start-Up Expenses

• A. What Are Start-Up Expenses?
• B. Starting a New Business
• C. Buying an Existing Business
• D. Expanding an Existing Business
• E. When Does a Business Begin?
• F. How to Deduct Start-Up Expenses
• G. Expenses for Businesses That Never Begin
• H. Organizational Expenses
• I. Avoiding the Start-Up Tax Rule's Bite

4. Business Operating Expenses

• A. Requirements for Deducting Operating Expenses
• B. Operating Expenses That Are Not Deductible
• C. Tax Reporting

5. Deducting Long-Term Assets

• A. Long-Term Assets
• B. Section 179 Deductions
• C. Depreciation
• D. Tax Reporting and Record Keeping for Section 179 and Depreciation

6. Inventory

• A. What Is Inventory?
• B. Deducting Inventory Costs
• C. Maintaining an Inventory
• D. Determining the Value of Inventory

7. The Home Office Deduction

• A. Qualifying for the Home Office Deduction
• B. Corporation Employees
• C. Calculating the Home Office Deduction
• D. IRS Reporting Requirements
• E. Audit-Proofing Your Home Office Deduction
• F. Deducting an Outside Office or Workplace

8. Car and Local Travel Expenses

• A. Deductible Local Transportation Expenses
• B. The Standard Mileage Rate
• C. The Actual Expense Method
• D. How to Maximize Your Car Expense Deduction
• E. Other Local Transportation Expenses
• F. Reporting Transportation Expenses on Your Tax Return

9. Business Travel

• A. What Is Business Travel?
• B. What Travel Expenses Are Deductible
• C. How Much You Can Deduct
• D. Maximizing Your Business Travel Deductions

10. Meal and Entertainment Expenses

• A. What Is Business Entertainment?
• B. Whom You Can Entertain
• C. Deducting Entertainment Expenses
• D. Calculating Your Deduction
• E. Reporting Entertainment Expenses on Your Tax Return

11. Hiring Workers

• A. Employees Versus Independent Contractors
• B. Tax Deductions for Employee Pay and Benefits
• C. Reimbursing Employees for Business-Related Expenditures
• D. Employing Your Family or Yourself
• E. Tax Deductions When You Hire Independent Contractors

12. Retirement Deductions

• A. Why You Need a Retirement Plan (or Plans)
• B. Individual Retirement Accounts-IRAs
• C. Employer IRAs
• D. Keogh Plans
• E. Solo 401(k) Plans

13. Medical Expenses

• A. The Personal Deduction for Medical Expenses
• B. Deducting Health Insurance Premiums
• C. Adopting a Medical Reimbursement Plan
• D. Health Savings Accounts

14. Additional Deductions

• A. Advertising
• B. Business Bad Debts
• C. Casualty Losses
• D. Charitable Contributions
• E. Clothing
• F. Dues and Subscriptions
• G. Education Expenses
• H. Gifts
• I. Insurance for Your Business
• J. Interest on Business Loans
• K. Legal and Professional Services
• L. Taxes and Licenses
• M. Domestic Production Activities

15. Record Keeping and Accounting

• A. Basic Record Keeping for Tax Deductions
• B. Records Required for Specific Expenses
• C. How Long to Keep Records
• D. What If You Don't Have Proper Tax Records
• E. Accounting Methods
• F. Tax Years

16. Claiming Tax Deductions for Prior Years

• A. Reasons for Amending Your Tax Return
• B. Time Limits for Filing Amended Returns
• C. How to Amend Your Return
• D. How the IRS Processes Refund Claims

17. Staying Out of Trouble with the IRS

• A. What Every Business Owner Needs to Know About the IRS
• B. Ten Tips for Avoiding an Audit

18. Help Beyond This Book

• A. Secondary Sources of Tax Information
• B. The Tax Law
• C. Consulting a Tax Professional

Index