Here are some deductions you may not know about - along with tips for determining whether you can or can't deduct your expenses
The general IRS definition of a deductible business expense is “ordinary and necessary”. When this rule is applied to various expenses, it is usually fairly easy to determine if an expense is deductible. However, some areas are a little more difficult. Here are a few tips for expenses you may not have known were deductible:
If you pay for these expenses personally rather than through the business, you need to use something referred to as an "accountable plan" for your business. You turn in a record of your expenses, the business cuts you a check. The business gets the deduction and you are reimbursed but pay no taxes on the check you receive.
There is also a way to deduct expenses you pay personally for a business in which you have other partners or shareholders. If you are in this situation (unreimbursed partnership or s-corporation expenditures), be sure to let your CPA know so she can record them on the appropriate section of your income tax return.