How Much Could You Bank If You Turned Your Charitable Contributions into Business Expenses?

If you do not itemize your deductions, pay self-employment taxes, or suffer deduction phaseouts, you will likely benefit from making your donations deductible as business expenses. But if you decide to make business contributions to charity, make sure you know how to make your proof stand up to scrutiny.

Nontaxable 1099

Not reporting the 1099 information is always a mistake. If you have a rental property that you rented less than 15 days this year, it is not taxable. If you do get a 1099, you should include it in your tax return, but follow our strategy to avoid any problems.

Bad Records Cost $78,775

Mr. Lam, a financial planner, lost every penny of his claimed $240,985 in deductions either because he had no proof or because both the IRS and the court declared his proof inadequate. Know the rules! Keep good records!

You Lose When You Answer Late

Learn from one taxpayer’s mistake: if you hire a lawyer for tax court, hire a tax lawyer.

Vitamins

Vitamin use falls into two different categories depending if you reimburse them under Section 105 Medical Plan or file them in your tax returns under your 1040.

105 Medical Plan

Here’s an example of a perfect plan for using the Section 105 Medical Reimbursement Plan for an employee-spouse in a single proprietorship.