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tax deductions?

what are some of the tax deductions for an at home business that you own & operate?

Answer Question
 
lacyjones

Asked by lacyjones at 8:47 AM on May. 11, 2009 in Money & Work

Level 17 (4,140 Credits)
Answers (4)
  • Part of rent, phone, electric, internet, groceries. You can also deduct gas, water, etc.
    TheDiva320

    Answer by TheDiva320 at 9:03 AM on May. 11, 2009

  • You can deduct those items TheDiva320 said but you must keep track of what is business and what is personal. For example if you have a home office, do you use it exclusively for business? If not the IRS may disallow it, same goes for all expenses (computer, printer, etc....), you can only deduct the % of the gas water, utilities that relate to the use of your home office, so if it's 10% of the total square footage and used exclusively for business then and only then can you deduct 10% of your utilities (including internet). Groceries are NOT allowed, as you would still have to pay for your own food if you were working at an office outside your house.
    finallyamom40

    Answer by finallyamom40 at 10:20 AM on May. 11, 2009

  • If you deduct your house/mortgage, be warned. When you sell, the government treats part it as if your business sold its share. Then you owe! I never deduct my mortgage, only non-capital things that get used up; things like internet and paper and ink. I do deduct my computer, but they want to know when you "take that out of service" too.
    Anonymous

    Answer by Anonymous at 11:05 AM on May. 11, 2009

  • The guidelines for home office deductions have become very strict. The area (including the computer) must be used only for one business, and not for any non-business purposes.
    http://www.irs.gov/newsroom/article/0,,id=108138,00.html
    rkoloms

    Answer by rkoloms at 5:08 PM on May. 11, 2009

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