ARE YOU SELF EMPLOYED/SUBCONTRACTOR/1099
QUALIFYING HOME OFFICE
A home office will qualify as the principal place of business if it is used exclusively and regularly by the taxpayer
to conduct administrative or management activities of a trade or business, and if there is no other fixed location
of the business where the taxpayer can conduct these activities.
COMPUTER AND CELLULAR PHONE
If you purchased a computer or cellular phone and use it for business, you may be able to claim a depreciation
deduction. Your employer must require you to have the phone or computer as a condition of employment, and
you must use them for the convenience of your employer. You must keep a record of the personal and business
use of the computer or phone to determine the percentage of business use.
If you use your car for business purposes you may deduct 34.5 cents a mile for un reimbursed mileage
expenses. Be sure that you keep a written record of your total mileage and business mileage.
ACTUAL EXPENSES OF CAR
When you use a car for business, you may deduct the mileage expense by using either the standard mileage
rate or the actual expenses of maintaining the vehicle. If you take the actual expenses, you can deduct the
depreciation, gas, oil, insurance, tires, licenses, repairs etc. If you choose to take actual expenses, you cannot
change to the standard mileage deduction method.
If you incur entertaining costs for business reasons, you may be able to deduct 50% of the amount. The expense
must be considered ordinary or necessary to your profession. Entertainment includes any activity generally
considered to provide entertainment, amusement, or recreation.
If you incur any advertising cost for you business, you may be able to deduct the actual expenses. The expenses
must be ordinary and necessary. Some expenses include business cards, letter heading, postcards and fliers,
radio ads, newspaper ads and commercial ads to name a few.
You may be able to deduct the expenses you occurred for the supplies you purchased for your business if the
supplies were ordinary and necessary.
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