Archive for May, 2010
Deductible Entertainment Expenses
May 13th, 2010
Question: Paid with Guaranteed Payments – can I deduct SE business expenses?
I am getting paid as an independent contract in a business that I own a small portion of, and my K-1 reports this payment as Guaranteed Payments to Partner. I know the method of reporting is correct, but since I am filing as a self-employed independent contractor, I would hope to be able to take my self-employment business expenses (expenses that the company did not reimburse me for) as deductions. Expenses such as car, travel, meals & entertainment, advertising/promotional, etc.
The argument that I would make is that the earnings I received as Guaranteed Payments to Partner would not have been possible without incurring business expenses along the way, thus the expenses should be deductible. My expenses equate to 18% of my Guaranteed Payments income, so this will be a significant deduction.
Is this logic correct? Can anyone point to somewhere in the code that allows this, or just give me clarity? I can’t find anything online or in the code that allows or disallows this.
Answer: I believe that you are correct. I would further suggest that you go to the IRS website and look for Schedule C and its accompanying instructions. I have reason to believe that if you examine this schedule and the instructions for filling out this form the answer(s) to your question will become self apparent.
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1099 Tax Deductions
May 13th, 2010
Question: What is the 2007 standard tax deduction for under $50,000 single male no kids?
I’m trying to figure out if I should take the standard deduction or do line-item. I am a 1099 independent contractor and have mileage, medical, home office supplies (but no home office) and charitable donations I can deduct. I did not contribute to any retirement plans. I am trying to determine if my line-item deductions amount to more than the standard deduction. Thank you.
Answer: A standard deduction for someone with filing status of single is $5350 for 2007.
Your business mileage as an independent contractor would go on your schedule C, not on schedule A anyway, so you don’t have to itemize to deduct that. Same for office supplies for your contractor work.
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TurboTax Home & Business Federal + State + Federal efile 2009 $42.89 TURBOTAX HOME & BUSINESS WITH… |
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Understanding Your Tax Returns: Your Income From Self-Employment And Real Estate Rental, And Your Deductions For Depreciation Understanding Your Tax Returns is a new series of tax publications designed to help taxpayers across the USA. The objective of these publications is to help taxpayers to understand United States income tax code as far as Form 1040; US Individual Tax Returns is concerned. With a good basic knowledge of the tax code, taxpayers will potentially be in the position to literally increase their income ta… |
Health care law’s hidden tax change to launch 1099 avalanche
An all-but-overlooked provision of the health reform law is threatening to swamp U.S. businesses with a flood of new tax paperwork.
Tax Forms & Deductions : How to File a 1099 Form
Income Tax Deduction Ontario
May 12th, 2010
Question: ontario taxes tuition?
I have what I think is a pretty straightforward question about filing tax returns in Ontario, Canada. Is it better to claim tuition costs in a year in which my income was about $35,000, or in a future year in which I’ll have about $70,000 income?
I believe the answer is straightforward – with higher earnings you are in higher tax bracket and it’s more beneficial to claim deductions in those years – but I thought I would try to confirm this is correct. For instance, I’m not sure if the deduction is claimed as if it were spent from your earnings in the lower tax bracket (15% on the first $40,970 of taxable income) or as if it were spent from earnings in the higher tax bracket (22% in Ontario on the portion of taxable income between $40,970 and $81,941). Thanks.
Answer: Tuition and education are not a deduction but a pre calculated tax credit that is a fixed amount. 15% federal 5.05% provincial(Ontario). no exeptions. The only advantage to tuition and education credits is if you don’t need them they carry forward indefinetly until you do need them. You can not use them to offset the higher taxes from the higher tax brackets or the Ontario health premium or CPP payable.
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WCSB Oil & Gas Royalty Income 2010-II Limited Partnership-Maximum Issue: $20,000,000
CALGARY, ALBERTA– (Marketwire – May 10, 2010) – WCSB Oil & Gas Royalty Income 2010-II Limited Partnership (“the Partnership”) is pleased to announce that it has filed a preliminary prospectus dated May 7, 2010 relating to the initial public offering of units of the Partnership. The Offering is a $20,000,000 maximum offering and its initial closing is expected to take place by early June.
Tax Advice for Entering the Workforce – Tax preparation Canada
Taxcut Software
May 12th, 2010
Question: Paper check or direct deposit for Stimulus plan if filed through H&R Block taxcut online software?
I received my tax refund through direct deposit pretty fast as I filed my taxes early this year. However, I have not received the economic stimulus check or even the 2nd notice of how much to expect. I was supposed to be expecting my deposit on May 16. Could this be because I filed through H&R’s online tax prep?
I did not have any fees deducted from my refund, nor did I get an anticipation loan.
Answer: It makes no difference what service you used to file your taxes. I used Block’s TaxCut online and had my stimulus check DD as scheduled.
You might be getting a check in the mail if you had your prep fees deducted from your refund. The IRS has the payment schedule for mailed checks; mailing takes a little longer than DD.
If you could’ve been claimed or were claimed as a dependent, you don’t qualify.
You can always check out the IRS.gov and get more information about the stimulus payment.
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TurboTax Home & Business Federal + e-File + State 2010 – [Old Version] $8.07 Designed for sole proprietors, self-employed, consultants, 1099 contractors, and single-owner LLCs. Expanded interview walks you through entering business income and expenses to help you maximize business and personal deductions, home office deductions, depreciation and more. Create W-2 and 1099-MISC forms for your employees and contractors. The Intuit TurboTax Home & Business Tax Year 2010 Softwa… |
H&R Block reports better-than-expected Q4 profit
H&R Block Inc , the largest U.S. tax preparer, posted a better-than-expected quarterly profit, partly helped by lower operating expenses, but declined to provide a guidance.
Tax Cut Dreaming
2008 Standard Deduction Head Of Household
May 12th, 2010
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Hewitt on Europe
Market pressures push eurozone to act fast