Leave it to the IRS to put you smack in the middle of two conflicting tax laws! One law denies your deductions for personal meals Another law allows meals as tax-deductible entertainment When the IRS and/or the courts invoke the infamous “Sutter rule,” you lose your business meal deductions to the extent that they don’t exceed the cost of your personal … [Read more...]
Audits
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Does claiming a home-office deduction increase your risk of an audit?
A lot of people believe that claiming a home office deduction is like waving a cape in front of a bull. They think that if they claim this valuable deduction the IRS will react with an audit and put them in a world of pain. But is this true? Does writing off your home office really open a Pandora’s box? You’ll get straight answers when you read my new article titled Tax … [Read more...]
How mortgage brokers can beat the AMT
When the Federal Housing Authority (FHA) made the Alternative Minimum Tax (AMT) apply to mortgage brokers, a lot of them got upset. Which should come as no surprise. You see, the IRS was disallowing business expenses on Schedule C and moving those expenses to the itemized deduction category. Of course, miscellaneous itemized deductions are not deductible for the AMT, so … [Read more...]
Avoid a fatal mistake with independent contractors
If you’re using independent contractors who are paid on a 1099, be careful. Be very careful. You see, if you don’t handle things exactly right, the IRS may decide that your independent contractors are actually W-2 employees. Which can open a large can of worms. If you want to play it safe and make sure that your independent contractors stay independent, don’t miss my new … [Read more...]
How to deduct mortgage interest on a tax-deductible home office
As you may know, the IRS limits the tax deduction (for the home-mortgage interest-deduction) to a maximum mortgage balance of $1.1 million. But what happens when you… Have a home office for which you claim tax deductions? AND Also have a mortgage in excess of $1.1 million? The answer can be tricky, which is why it’s worth reading my brand new article titled Tax … [Read more...]