Ask An Accountant-Deducting Business Mileage

It’s that time of the year to get your year end tax information organized. My “Ask An Accountant” series should help with many questions that may arise. Remember, if you have a tax question, email my husband who is an experienced accountant at cjwtaxpro@gmail.com

Question:

I travel quite a bit to teach coupon classes.  Can I deduct the mileage?  If so, what are the rates?

Answer:
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Ask An Accountant: Paying Your Taxes On Profit

It’s almost December so I know many of you may be scrambling to get your year end tax information organized.  My Ask An Accountant series should help with many questions that may arise.  Remember, if you have a tax question, email my husband who is an experienced accountant at cjwtaxpro@gmail.com

Question:
I have a small business and I was wondering if I pay my taxes based on the income I earn or the income left after I have paid expenses?

Answer:

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Ask An Accountant: Organizing Year End Data

It’s November and we have gotten a lot of questions concerning what information you need to be prepared for tax season.  Below is a 10 point checklist for information to gather & organize for your accountant. 

My husband is an experienced accountant and will be answering question sent to him at cjwtaxpro@gmail.com with the subject line “Ask An Accountant”. You can see previous questions/answers by clicking on “Ask An Accountant“.

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Ask An Accountant-Do I Claim Swag Bucks or Daily Deal Sites Credits?

As year end is quickly approaching, many people have tax questions and are looking for deductions to help with their taxes. My husband is an experienced accountant and will be answering question sent to him at cjwtaxpro@gmail.com with the subject line “Ask An Accountant”. You can see previous questions/answers by clicking on “Ask An Accountant“.

Question:
Do I have to claim Swag bucks credits or referral credits awarded to me from daily deal sites?

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Ask An Accountant-Deducting Meal Costs For A Cooking Blog

As year end is quickly approaching, many people have tax questions and are looking for deductions to help with their taxes.  My husband is an experienced accountant and will be answering question sent to him at cjwtaxpro@gmail.com with the subject line “Ask An Accountant”.  You can see previous questions/answers by clicking on “Ask An Accountant“.

Question:
I own a cooking blog and blog about recipes and my family meals.  Can I deduct the cost of the ingredients needed for the food shown on my site?

Answer:
Here are some questions you need to ask yourself. Your answers will determine deductions.

1.       Is the blog a business (profit motive) or a hobby (not profit driven)?

2.       Only 50% of meals & entertainment are deductible for business purposes, so I would not deduct any more than that.  This also assumes the meal is consumed by the family after being posted on the website.

3.       If a business, then I would deduct 50% of the cost of the meals used on the website in the month they were cooked & eaten.  If a hobby, you can only deduct expenses equal to the hobby income, so the best case scenario you would report a net 0 profit (can’t have a hobby loss).  In the hobby scenario, I would still only deduct 50% of the cost of the meals.

*Please keep in mind this post is for informational purposes only and answers given are very general.  Do not rely on this column for definite tax answers as many things depend on individual circumstances.  Please contact your personal accountant or financial advisor for your particular situation.

photo credit: austinpost.org

Ask An Accountant: Blogger Question-Can I Deduct Professional Advice?

Although tax season is over, tax questions arise year round.  My husband is an experienced accountant and will be answering questions sent to me at cjwtaxpro@gmail.com with the subject line “Ask an Accountant”.  See previous questions and answers HERE

Question:

I am a blogger who has recently set my site up to be a “business”. This required seeking advice from lawyers and an accountant.  Can I deduct the fees I was charged for this advice?

Answer:

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Ask An Accountant-How Does IRS Determine Who To Audit?

 

Although tax season is over, tax questions arise year round.  My husband is an experienced accountant and will be answering questions sent to me at cjwtaxpro@gmail.com with the subject line “Ask an Accountant”.  See previous questions and answers HERE

Question:

My sister and law, brother in law and my husband all recently got letters from the IRS asking for all of this documentation from previous tax years. For my sister in law they are requesting information for 3 years, for my brother in law 2 years and for my family one year. We all get your taxes done by the same person. They are asking for copies of children’s birth certificates, marriage licenses, etc. How and why does the IRS determine to audit individuals?

Answer:

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Ask An Accountant-Is My Blog A Business Or Hobby?

 

Although tax season is over, tax questions arise year round.  My husband is an experienced accountant and will be answering questions sent to me at cjwtaxpro@gmail.com with the subject line “Ask an Accountant”.  See previous questions and answers HERE

Question:

When should a blogger start considering themselves a business for tax  purposes? Is there certain criteria that, once hit, a blogger must start  to consider their blog a business instead of a hobby?

Answer:

The blog is considered a business when there becomes a profit motive.  Either way, business or hobby, the income needs to be reported.  With this in mind,  the hobby expenses are limited to the hobby income, meaning you can never take a hobby “loss”.  A business can show a loss that may offset other income sources based on the way the business is structured.

*Please keep in mind this post is for informational purposes only and answers given are very general.  Do not rely on this column for definite tax answers as many things depend on individual circumstances.  Please contact your personal accountant or financial advisor for your particular situation.

photo credit: austinpost.org

Ask An Accountant-IRA Early Withdrawal Penalties

Although tax season is over, tax questions arise year round.  My husband is an experienced accountant and will be answering questions sent to me at cjwtaxpro@gmail.com with the subject line “Ask an Accountant”.  See previous questions and answers HERE

Question:

I am considering taking an early withdrawal from the Rollover IRA account ($13k out).  I recently had surgery and this is needed to clear bills, debt and get the budget back.  I know I am looking at a 10% hit on the taxes next year for a penalty ($1,300), but what else am I looking at?  How much else should I expect ?

Answer:

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Ask An Accountant-How Should I Claim Day Care?

Although tax season is over, tax questions arise year round.  My husband is an experienced accountant and will be answering questions sent to me at cjwtaxpro@gmail.com with the subject line “Ask an Accountant”.  See previous questions and answers HERE

Question:

 I have two questions:
 
1. Can I claim the after school program my son is in? He is in Kindergarten and instead of paying for an after school sitter we are paying for an after school program at the school. Is that deductable?
 2. Can we claim/deduct our moving expenses?

Answer:

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Ask An Accountant-Claiming Income Under $600

Although tax season is over, tax questions arise year round.  My husband is an experienced accountant and will be answering questions sent to me at cjwtaxpro@gmail.com with the subject line “Ask an Accountant”.  See previous questions and answers HERE

Question:
I am a blogger who works with various affilate companies and vendors.  Is it true that if one of them pays me less than $600 a year then I don’t have to claim that income?

Answer:
No, that is not true.  You have to claim everything you make.  However, if you earn less than $600 from a company, they do not have to send you a 1099. Basically the company is not required to report it but you still should.

*Please keep in mind this post is for informational purposes only and answers given are very general.  Many things depend on individual circumstances.  Please contact your personal accountant or financial advisor for your particular situation.

photo credit: austinpost.org