First, the bad news: As we explained previously, tax reform wiped out 50 percent business-entertainment deductions. Which means you can no longer write off “directly related or associated” business-entertainment expenses. In other words, you can wave good-bye to deductible business meals, ballgames, etc., with clients and prospects. Now, for the good news: All is not … [Read more...]
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How to Survive an Entertainment-Deduction Audit
It’s a fact… You don’t need a receipt for an entertainment expense that’s under $75. But don’t think the IRS is asleep at the switch. They know that a lot of folks deduct many under-$75 meals, etc., that aren’t legit. What’s more, they can smell fishy entertainment deductions a mile away and, in an audit, make your life miserable if you’re not careful. Want to learn … [Read more...]
Yikes! New IRS Audit Tool: The Form 1099-K Letter
The IRS is constantly looking for ways to nail tax-cheats and they’ve come up with a doozy. I’m talking about the 1099-K. This is the form that banks and others send to the IRS telling the IRS how much they remitted to you for your credit card, debit card, and similar transactions. The 1099-K reports the gross amount of transactions including credit-card sales, sales tax, … [Read more...]
How to maximize vehicle-mileage deductions (Part 1)
Whether you’re running a corporation, proprietorship, or partnership, you want to claim the maximum mileage deductions possible. But be careful. You see, it’s extremely important to deduct only legitimate miles. If the IRS finds mileage-deduction violations, you’ll look like a tax cheat and potentially open the door to a detailed audit. No fun. So how do you deduct all … [Read more...]
How a little knowledge can save you in an audit
Most tax advisors serve their clients well. But that doesn’t mean that you should be ignorant of the tax law and passively accept all your tax professional’s advice uncritically. Hey. It’s your money and you need to be aware of what’s going on… especially if you’re called into an IRS audit. That’s what Mrs. and Mr. Smith found out the hard way. Read the full article. You … [Read more...]