2009 tax deductions

2009 tax deductions

Schedule C Tax Deductions: "b" is for Bad Debts, Bank Charges & Books

Are you wondering whether you are deducting the law all the dépenses Allowance for your sole proprietorship? Here are Three Commonly Overlooked deductions That begin with the Letter "B".

1. Bad Debts. If you use the Accrual Method of bookkeeping, you record from a dirty revenu When You invoice the customer, Regardless Of When OR Events whether THEY pay you. So What Happens If They do not pay you? Let's Say That Have Several months PASSED and you keep statements Sending Them That continues to Be ignored. By the end of the year, if you've done all you can do to collect the payment Without success, you can take a deduction for the uncollectible amount. This Is Known as a "bad debt "and you should" write it off.

What Happens If You Deduct the bad debt on your 2008 return and the customer surprises you by making payment in 2009? You Simply record the payment revenu we have your 2009 return.

If you use the Cash Method of bookkeeping, you record the revenu Only When the customer country you, so there really is No bad debt to deduction.

2. Bank charges. All Those annoying nickel and dime bank fees APPEAR That on Your monthly bank statement are deductible business expense. The key here Is To take the time to examine very carefully Every monthly bank statement and bank charges giving further Then record in your bookkeeping software program or manual record keeping "system. It's easy to load Overlook thesis Because You did not write a check or use your Credit card to Incur em.

La même fixe thing to merchant credit card fees. If you accept credit card payments from customers, fees are Probably Assessed to your bank account Every thesis month and fees are deducted from your bank Automatically scale. Be sure to record giving further charges, too, or you'll miss out on bona fide tax deduction.

3. Books, Magazines, Trade Journals. Any book you purchase for business use Is a Legitimate tax deduction. Be Careful here not to limit this deduction to only giving further books deal with your That Particular Industry, product Gold service. Self-help books Contain Much That Is advice applicable to your life as a business owner, "as well as books on topics as time management SUCH, people skills, salesmanship and marketing.

And While We're on the topic of reading material, Probably you subscribe to newspapers, magazines and trade journals you read That Primarily for Business Purposes, N thesis are deductible "as well.

Since none of contention Three dépenses Specifying Have a Schedule C line in Part II, the best place to put 'em Is in Part V, Other Expenses. The total of all thesis Other Expenses (line 48) IS THEN transferred is To Schedule C, Line 27.

About the Author

Looking for more small business tax tips? For a free copy of the 25-page Special Report "How To Instantly Double Your Deductions", visit http://www.yousaveontaxes.com . Wayne M. Davies is author of 3 ebooks on tax reduction strategies for small business owners and the self-employed.

Can I deduct 2008 and 2009 property taxes on my 2009 tax Schedule A/B?

Local Tax assessors allow me to physically pay property taxes in the assessed year, or within 2 months of the following year. If I pay two years worth of taxes in the same year (i.e. 2008 taxes in January 2009 and 2009 taxes in December 2009), my deductions would be significantly higher. Note that my standard deduction is very similar to my itemized deductions, so there is very little advantage to itemize (unless I can move my property tax payments to increase every-other year's itemized value).

Yes, this is a valid way to shift deductible expenses from one year to another. The IRS only cares about when you spent the money - not the date it was due to your town or city. You could also do it in reverse - pay 2010's taxes in December of this year.

And, you can prepay your mortgage a few days early to pick up one more interest payment - just know it will be one less the next year.

You can also do the same with your state income taxes but it is trickier to do as you don't want to trigger an underpayment penalty with your state. Overwithhold on your state income taxes so you get a bigger deduction, then when you get a refund, recognize the refund in a later year.

You also might want to look at categories such as student loan payments, education expenses, and if you are self-employed, any business expenses you can bunch up or spread out as needed.

How do Tax Deductions Work for 2009, 2010.mov

 

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2009 tax deductions

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