Business Tax Deduction Checklist
The IRS Code is pretty vague as to what qualifies as a tax dedcution for your business which leads many business owners to search for a tax deduction checklist. You can find yours here, in My Tax Tutor for Small Business Owners.
The IRS Code merely says that an expense has to be necessary, ordinary and reasonable for it to be deductible for a small business. Oh, and of course, it has to be made in connection with your trade or business.
You would think that necessary means that you cannot do your business without it. But the IRS definition goes beyond such a narrow definition of necessary to include things that may be ‘helpful’ in your business, even if you could do business without them. Confusing, isn’t it?
Ordinary is, well, ordinary. Meaning it is usual for your type of business to have this type of expense.
Reasonable basically means not lavish or extravagent.
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