Outright.com Giving Away $2,000 to Wise Bread Readers

By Will Chen on 22 March 2010 (Updated 13 April 2010) 395 comments

Winner Announcement:

I have emailed Jacob and DMed ShesAnAngel417.  Please reply ASAP to claim your prize!

Outright.com, a free online bookkeeping service for the self-employed and small business owners, is giving away $2,000 to Wise Bread readers!

My favorite part of Outright.com is their community where you can get free expert advice from accountants and bookkepers.  For example, their community members got answers on questions like:

Of course, you should always be careful about getting free advice online, and I would double check everything with your own accountant later.  However, it is nice to have a quick tax resource that is 100% free.

In addition to the contest, Outright.com co-founder Kevin Reeth also shared some great tips on the most overlooked business deductions and most common tax mistakes later in this post (jump to interview). 

But first, the contest!

 

Blog Comment Contest:  $1,500

Prize: 1 winner of $1,500, randomly selected from the comments in this post.

How to Enter

Simply leave a comment below answering any one of these questions: 

  • For everybody: What is your most pressing tax question before April 15th? (By the way, you can get free expert advice from accountants, bookkeepers and other business owners at Outright's Community.)
  • If you are self-employed or a business owner: What is the one expense that you wish the IRS would let you deduct for your business and why?  (Need some ideas?  Add your expenses to Outright.com and discover what is deductible.)
  • If you don't have a business:  What do you think businesses should or should not be able to deduct and why?

Don't forget to enter your email address while leaving a comment.  We can't contact the winner if you don't leave an email address.  One blog comment per person please.

 

Twitter Contest: $250

Prize: 1 winner of $250. Randomly selected.

How to Enter

Follow @WiseBread on Twitter (we can't notify you as the winner if you don't follow us).  Then simply tweet one of these messages: 

 

Outright.com Facebook & Community Contest: $250

Prize: 1 winner of $250. Outright.com will randomly select one of their new fans following them on Facebook or joining Outright.com's Community.

Two Ways to Enter

Yes, you can do both to increase your chances of winning.

 

Rules For All Three Contests

The Blog Comment, Twitter, and Facebook/Community contests all end at 11:59 pm EST on 4/2/10.  Winners will be announced on this post on 4/6/10. You can enter all 3 contests, but you can only win once. US residents only, must be 18 or over, void where prohibited.

 

Interview With Outright.com Co-founder Kevin Reeth

What are the most commonly overlooked tax deductions for the self-employed?

There are plenty of deductions out there for self-employed professionals that, thanks to the complicated tax code, are often overlooked.

We’ve found that the home office deduction tends to be the most commonly overlooked—and the one that causes the most confusion for those who are self-employed. This deduction allows an individual to write off any expenses incurred from running a business out of their home, for example, you may write off a percent of your rent or mortgage based on the proportion of your home that the office occupies. But we’ve found so many people are worried about an audit that they are scared to use this deduction, missing out on huge savings. Don’t be overly worried about the deduction—if you run your business out of your home and have a room or a portion of your home dedicated to your business, measure the square footage and write it off. Even though more than half of all small businesses are home-based, the majority don’t claim the home office deduction.

Mileage is another often overlooked deduction. Deducting transportation expenses is one of the most tedious and confusing components of tax prep for the self-employed, but again, it can reap huge rewards. For those who are on the road a lot, like contractors, plumbers or realtors--who average 20,000 miles per year on the road--writing off business-related transportation can save thousands of dollars a year. You can deduct $0.50/mile for each work-related mile traveled.

A good (but confusing) deduction for the self-employed is office equipment. Unless you buy a lot of equipment (in 2009, the limit was up to $250,000), you can write off the full purchase price for that equipment in the year in which it’s first used.  However, if you aren’t making a lot of money, you might be wasting a possible deduction.  You can instead choose to “depreciate” the item, which means writing off the cost over multiple years. Most office equipment gets depreciated over 5 years (computers, copiers, fax machines, etc.)  Office furniture gets depreciated over 7 years.  So, see how your overall profit and loss is looking for the year before deciding which way to go – it can make a difference down the road when you might be earning .

What are some of the more common tax/deduction mistakes made by the self-employed?

Again, the process for filing taxes can be super complicated and we see both first-time and seasoned filers making mistakes that can either lead to an audit or cause them to miss out on key deductions. One big mistake is not paying taxes because they don’t think it’s a lot of money or because they have other bills. Or they wait until the end of the year, instead of paying estimated taxes throughout the year. Another is to allow themselves to get disorganized, which causes them to miss important deductions or critical tax deadlines. Other mistakes include:

1.  Forgetting to sign and date your return. This is so common, the IRS even posted a video on You Tube, with sign language, to remind people to sign and date their returns.
 
2.  Math errors. The frequency of math errors has gone down recently as more people are using software or professional return preparers, but simple addition and subtraction errors are still an easy mistake you need to avoid.  Double check any manual math before sending in your return.
 
3.  Wrong social security numbers for you, your spouse or your dependents.  A sure way to get a letter from the IRS is to put an incorrect social security number on your return.  Their computers automatically match names and social security numbers for every return.
 
4.  Not matching information returns to your personal tax return.  You know all the information returns you get in January and February like W-2's, 1099's and 1098's, well the IRS gets a copy of those also and they match up your return with their copy.  Sometimes you may have a legitimate reason why amounts on a 1099 will not agree with your return, but a W-2 should always match what you report.  If you get an information return that is not correct, contact the person who sent it and have them send you a corrected copy.
 
5.  Mixing up deductions and credits.  Deductions are used to calculate how much of your income is taxed, whereas credits are dollar for dollar reductions in your tax liability.  Use a bookkeeping application like Outright.com for your business to record everything accurately.
 
6.  Putting the wrong bank account information on your return.  If you are getting a refund, the IRS allows you to choose to have your money direct deposited into your checking or savings account.  All those little electronic looking numbers at the bottom of your check are how the IRS knows where to send your money through the banking system.  When you put those numbers at the bottom of your return, you can be off one number and that refund will not find its way into your account.
 
7.  Failing to file electronically.  Electronic filing was first introduced in 1990 and turns 20 this year.  When you file a return manually, most of the information has to be scanned or manually keyed in by an IRS employee.  In their own studies the IRS found that they themselves made mistakes on 20 percent of the returns that were processed manually compared to under 1% on electronically filed returns.

Are there any special new tax rules for 2009 the self-employed should watch out for?

Very few of the 2009 tax law changes had any positive or negative impact on small businesses, but with the constant media coverage of the changes to the individual tax laws, most self-employed workers are worried they can’t keep up.

There are two tax law changes that self-employed workers should keep in the back of their minds when filing taxes: the Making Work Pay tax credit and the ability to carry back operating losses.

Although the Making Work Pay tax credit is targeted towards employees, self-employed business owners can benefit too. This is not a deduction, but rather a credit, meaning you can write it straight off your tax liability. The credit is worth up to $400 for working individuals who earn between $75,000 and $95,000—significant sums for self-employed workers.

If your business hasn’t performed as well as expected, you can take advantage of the ability to carry back operating losses. This means small businesses with deductions exceeding their income in 2008 can use a new net operating loss tax provision to get a refund of taxes paid in prior years.

Who uses Outright.com?

Anyone who works for themselves or has started a small business can use Outright.com. The majority of our users are sellers on sites like eBay, etsy and Amazon. Many of our users are freelance writers, web designers, realtors, and bookkeepers. We also have a large presence of people who are craftsmen and some more unusual professions, like a canine holistic therapist.

What are some of your favorite free apps for the self-employed besides Outright.com?

Right now, there are some really great resources out there for the self-employed.

We love social networks like LinkedIn because it makes it easy for self-employed workers to connect with potential clients without spending thousands of dollars on marketing and customer relationship software.

We recommend people get a web presence. Create a blog on Wordpress, Typepad or Blogger. We are also huge fans of Google apps—especially Gmail and Google Calendars. They’re free and incredibly helpful in making your business look even more professional. You can integrate all of these to your domain name and website through Google Apps for Your Domain.

Another great free tool for the self-employed is Craigslist both for buying cheap office equipment (that’s still in good condition) and reaching potential clients by promoting your services. Plus, if you grow and need to hire, Craigslist is a great way to find potential employees.

For free finance related tools, we love Shoeboxed and Xpenser. Shoeboxed lets you scan receipts and automatically turn them into categorized expenses. Xpenser is a mobile epense tracking service that lets you easily record expenditures while you’re out and about, by email, text message, or even Twitter. Both Shoeboxed and Xpenser hook up seamlessly with Outright.com, making tax time even simpler.

And then of course, once you do start making a little bit of money, then we strongly recommend people take a look at Outright.com.

Why is Outright free?  How do you make money?

Let's just say that we don’t think people should have to pay a lot of money to do their financial record-keeping, especially in an era of great online tools.  We provide Outright for free in order to help as many entrepreneurs as possible.  We have begun offering additional paid services, such as a 1099 e-filing service, and will continue to do so.  But Outright.com’s basic bookkeeping service will remain free.

About Outright.com

"Outright.com is streamlining the work involved with owning a business, helping entrepreneurs pay the right taxes, record financial transactions, and keep their businesses on track and growing.

Outright.com was created after watching entrepreneurs struggle to capture all of their business deductions, often piecing together different solutions. Whether sticking every possible receipt in a file folder and shipping it off to a bookkeeper, tracking everything in a huge spreadsheet, or even using a couple of different web sites to track transactions and create invoices, the results were invariably the same: too much time and effort spent on the least enjoyable part of running one's own business. Our goal: to keep it as simple as possible; helping entrepreneurs track all of their income and expenses to get their taxes done accurately."

Don't forget to leave a comment below for a chance to win $1500!

Tagged: Giveaways, Taxes
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Guest's picture
kenf

The one expense I wish the IRS would allow deductions for would be taking a far more liberal view towards what constitutes a deductible home office expense. The current language is far too vague and doesn't seem to envision our rapidly evolving digital world where clients are often not met with physically but through phone, e-mail, teleconference, webconference etc.

Guest's picture
Jacob

As a business owner, I would like for higher education to be tax deductible. Say for instance, I would like to obtain a master's degree in my spare time. I would like to be able to write off those expenses! It would encourage those with a business to further educate and create more options!

Guest's picture
Rich Grebe

Yes, I agree. To stimulate small home-based business, it would be benificial to be able to deduct all the depreciation on capital and equipment relating to that business in the first year or two of beginning the business. Often, it is at the onset of establishing a home-based business when capital costs are highest and the business has limited income due to a lack of established clients.

Guest's picture
MaggieS

I think training a new employee should be deductible since it helps the economy and the tax base to have more people employed. Whether the training is formal as in classes or a more informal training on the job up to about 6 months, I think it's very valuable to our society as a whole. It's important to have a well-trained workforce, so why not support that with tax breaks?

Guest's picture
Guest

I most wish the IRS would allow people to take a deduction for charitable donations, even when they don't fully itemize their taxes in other ways. How much more vibrant would our civic life be if we could deduct for every $100 we give from our hearts?

Guest's picture
Christy

Thank you for the valuble information.

Guest's picture
Greg

Mileage and equipment, especially.

Guest's picture
Guest

One expense I believe small businesses should be able to deduct are those relating to professional development. Association costs, conferences, Webinars, and other expenses that help small business owners learn and grow should be deductable.

- DG

Guest's picture
Terence

What do you think businesses should or should not be able to deduct and why?

I believe businesses should be able to deduct costs relating to their businesses, but that it should not cross over too far into "family usage" (phones, internet, etc.)

Sure maybe you'd be able to deduct car mileage and related travel expenses, but keep it fair for everyone.

Guest's picture
David Horowitz

I think businesses should be able to deduct expenses for professional training, such as conferences. Professional development can be important to the success of any business, but is also expensive. Getting tax help could give more incentive to small business owners to "skip out" on work by learning new skills instead.

Guest's picture
Selene M.

Business should be allowed to deduct specific expenses such as advertisement cost, donations, health insurance costs, mileage and stipends paid, and business supplies. Business needs tax help just as much as individuals, and if items are deductible, businesses will spend that much more on them, thus helping the overall economy.

Guest's picture
AmandaD_TX

I'd support businesses being able to deduct additional benefits for employees- like health insurance.

Guest's picture
Amanda

I do not run a small business out of my home, but I think that the use of home office and mileage related to your business should be able to be deducted. That being said, I think the current language is vauge and unclear, and too many are either not taking advantage of the deduction or are abusing it (i.e., it's one end of the spectrum or the other!).

Thanks - great blog!

Guest's picture

I agree with the Professional Development deductions.

Guest's picture
Mark

While the IRS already allows a deduction for home office usage, I wish there would be less restrictions on it as it is difficult with a small home to section off a portion of your house for business only. This is especially true in this day of laptops and wi-fi.

Guest's picture
Kelli

...anything that is truly a cost of running the business: equipment, cost of renting space, uniforms, etc., etc.

Guest's picture
David K

In my experience I have been able to claim many of my personal expenses for my job. I think we should be given a more liberal definition of what is tax deductible. I think that it should go beyond buying clothes for your job, etc and include any other para-professional development. Then again, I already claim all these things but I've been fortunate to not yet get audited.

Guest's picture
sona

I understand it can be hard to keep the home office expenses separate from home expenses ... but if you are running a small business, then these should be completely different phone lines. Try using phonebooth or google voice to log all the minutes used, get a separate phone number if the need be. And clearly track the minutes used for business and home/personal.
The false tracking/claiming of the home office expense by many has led to through scrutiny of your taxes/higher chances of audit if you pick the home office deduction.

Guest's picture
Brian

I am not currently self-employed, but I've toyed with the idea several times.

My top three write-offs would be workspace (% of mortgage), equipment (computer, etc.) and utilities (electricity, WiFi, etc.). The sticky part as someone (Mark) mentioned previously is what portion of WiFi should be deducted. I thought about this and here's what I came up with: I would already have a separate business PC, so I could measure the % usage from that IP vs the rest of the household. Electricity would be the harder part to measure...

Guest's picture
Kristin

My health insurance premium should be a business expense as someone who is self employed.

Guest's picture
Michelle Millender-Baeck

Being self-employed can be a time consuming venture. As hourly and salary get paid for the hours worked, is there a deduction available for hours worked in my business? Office space, mileage and other expenditures are deductible why not my time? If so, how and if not, why not?

Guest's picture
Audrey H.

I believe a small business owner should be able to deduct for stress and pain & suffering! Only half tongue in cheek. :)

Guest's picture

I have just started my home based business this last year and my CPA deducted ALL of my insurance premiums because of my business. I also would like to see specific instructions about the home office deductions so more people would be able to use it!

Guest's picture
Sushi

Professional development should be deductible. Conferences and the costs associated with going to one are not-so-surprisingly expensive.

Guest's picture

Here's any answer to #2.

Businesses should be given more freedom to deduct their legitimate expenses. On the other hand, the definition of businesses should be more strict so as to bar anyone just claiming to be one to take advantage of the system.

Applying some simple accounting rules should filter out most shell companies.

Guest's picture
Diane

Meals in full. Now you can only deduct a certain % of this expense (presumably because they think there is fraud associated with this expense category). What this means is that I spend money while traveling for client business, but cannot fully deduct all the food I eat while on the road. What - is that burger only 50% a client expense? Makes no sense at all.

Guest's picture
Mipo777

I agree that clear standards of home office should be defined and deductable.

Guest's picture
Gil

What do you think businesses should or should not be able to deduct and why?

I also believe that the home office deduction rules could be expanded. Currently I don't take it because I don't fit all the requirements to a tee. (Even though I work 40 hours from this space). If I have to pay a fee for a home occupancy permit within my city of residence, I believe I should be able to deduct my "home office" (even if I occasionally use the area for non-business work). But on the flip side I understand why the rules are as they are. It's always those that would take advantage of such laws to ruin it for the rest.

Guest's picture
Savannah

Small business owners should be able to deduct home office expenses, but as mentioned in the post, I have certainly seen people be afraid of all the detailed rules and of potential audits. A trustworthy tax professional should be able to walk you through the deduction process to ensure accuracy.

Guest's picture
Josephine

I'm not self employed so I'm not sure of the exact rules, but I agree that professional development should be deductible.

Guest's picture
Ali

I own a small business, and agree wholeheartedly that professional development should be deductible, as well as any legitimate business expenses that stem from advertising, production, and operation of your business.

This is going to sound odd, but as a little stimulus package, it would be pretty nifty to get a tax credit for paying down principal amount of business loans, not just the interest. In this economy where it's so tough for small businesses to get credit and keep the cash flow running, it would be great if the IRS could let us put some money into the hands of creditors and investors rather than in the IRS's pockets. The loans themselves aren't income, so paying those can't be deductible expenses. BUT, if we could get a credit during this tough time, as a little tax help for small businesses, that would be pretty nifty.

Guest's picture
Patrick

I am not a business owner, but I agree wholeheartedly that home office deductions should be more lenient and clear. I have tried to take this deduction many times for my dedicated home office, but did not meet the ambiguous standards. Otherwise, I would say professional membership dues and conferences and training should be deductible.

Guest's picture
Michael

I could've used this a few years ago when I was running a home business. One of the reasons I haven't started it back up since I moved out of state is because I hated doing the taxes. Maybe it's time to re-evaluate.

Guest's picture
karmella

I'd like to see broader views of home office space as well, and if I'm working remotely (coffee shop, etc) I'd like to see those expenses deductible.

Guest's picture
Jill

Businesses should be able to deduct anything that they use to run their business: office space, equipment, mileage, etc.

Guest's picture
Kim

Mileage isn't hard to track, but it's a pain. Unless there are repeated trips, I end up missing this one.

Guest's picture
Melissa T-G

the expense of hiring a tax professional when establishing a small business, and yearly thereafter, should be deductible.

Guest's picture
Jen

I am newly self-employed as a consultant, and have yet to wrap my head around what is and is not deductible.

I am hoping that continuing education classes that are work related (in my case, anything software development related) are deductible.

In any case, the site looks great, and I look forward to using it! In less than 10 minutes of reading, estimated tax payments have been demystified for me, and it looks like there is a wealth of information here. Thanks!

Guest's picture
Amanda

I don't own a business myself but I think that any valid expensive operational expenses. I also agree with the person above me that said the amount spent on tax preparation assistance should be deductible.

Guest's picture
Steve

Deduct all professional training.

Guest's picture

equipment, mileage for sure.

email arthur (**AT) financialbondage (dot) org

Guest's picture
Cassandra R.

What do you think businesses should or should not be able to deduct and why?

I think many things should be deductible, such as mileage, tax prep, and professional development. However, what I find more important is making sure the guidelines are clear about what can and cannot be deducted. Like someone above said, you get people who don't know they can deduct something, and you also get those who take advantage of the situation. It's important to get that clearly laid out.

Guest's picture
JBP

The one thing that immediately came to mind is the expenses associated with creative development. I think this should apply to the obvious cases, such as professional development workshop fees, etc., but also to the more back-of-the-napkin type expenses. Admittedly, that naturally gets into an area of expenses which are not easily cataloged, and not every beverage and ideas-lunch should feasibly be deducted. However, I think there's room to allow a standard deduction for money allocated to creative development across the board, and perhaps as a percentage of the size of the small business in question.

I should also add the caveat that I know next to nothing about the operation of a small business, but that's what I would want most were I a newcomer to the entrepreneurial/small business world.

Guest's picture
Ryan

I believe that professional development is something that the IRS should let small business deduct. This type of development is vital in the success of small businesses!

Guest's picture
Trung Ly

My brothers and I started a business last year renting out a vacation home. When I went to do the taxes for the partnership, my tax account said we couldn't deduct the cost of the down payment we put down to purchase the house. I wish I could've deducted that since it was the single biggest expense we had.

Guest's picture
Charlie Brinson

I am not a business owner but I think that a company should be allowed to deduct the paid vacation time that it gives its employees. It doesn't seem fair that they would have to be taxed when they are already paying someone for not doing a damn thing.

Guest's picture
Randall Brown

I think that any class you attend, in order to improve any part of your business, should be deductible.

Guest's picture
Scott

I wish the IRS would offer clearer and broader interpretation of being able to deduct home office space for telecommuting. Being able to deduct if it is for your employers convenience makes me hesitant to deduct. They do have room for me in the office, but it is a mutual benefit for me to work from home. Does that qualify as convenient for my employer?

If this was clearer I would be more comfortable using this deduction. Kevin is so right when he said "we’ve found so many people are worried about an audit that they are scared to use this deduction, missing out on huge savings." Being scared of an audit is what holds me back from making deductions I am not confident about.

Guest's picture
Guest

Businesses shouldn't be able to deduct as much as they do, but having a deduction by providing their employees with good health insurance is a good idea.

Guest's picture
Walter Daniels

This is in line with the political nonsense of "taxing businesses." Every dollar that a business takes in, comes from the customer. The reality is that prices cannot be raised on an infinite basis. Except for drugs and taxes, there is no such thing as a product with no competition. There is always the option of doing without, no matter how "necessary" a product is, you can always do without. In plain terms, this means prices cannot go up forever.
Once a price exceeds what people will pay, it stop selling. Once this happens, all business income ceases. The business owner/operator is entitled to a reasonable income, unless you countenance stealing their efforts. This is otherwise known as that evil word, profits. If there are no profits, there is no business. Without business income, there are no taxes to be paid, no employees to be paid, and a general collapse of the economy, along with no money for Government programs.
The fewer deductions allowed, for honest expenses, the lower the profits, and the greater the chance of no taxes from an operating business. Taxes are like taking water for a well. As long as there is water there, you can get some. If the well stops filling, pretty soon no more water. If businesses stop making money, the tax well stops filling, and soon no money to tax.

Guest's picture
Lynda

I don't have my own business, but I think you should be able to deduct education-related expenses like classes or books. Taking clients out for meals are iffy - they should normally be deductibel unless if you opt for higher end meals when a cheaper alternative could suffice.

Guest's picture
Bella

I don't own a small business but have family members that do. I think that the IRS should allow leniency on capitalizing items (property, machines, etc.), allowing them to be tax deductible until the business is able to make a profit out of it. I know this is a big reason lots of small businesses fold because they aren't able to make up the losses fast enough-especially for brick and mortar stores.

Guest's picture

travel, equipment, including paper, file folders, right down to the paper clips.

Guest's picture
Caitlin Chase

I think anything that is truly needed and useful for the company to develop/grow. Things that are essential to the running of the business.

Guest's picture
jennifer

I don't think they should be able to deduct travel and food to build business contacts.

Guest's picture
Shannon

classes and books that go toward your occupation, but may not be from a particular school.

Guest's picture
Mandy

I have always thought that it stinks that you can't deduct for equipment, especially home office equipment, that isn't "exclusively" for work use. I can understand the point - they don't want people deducting things bought "for the business" that are only used for the business 5% of the time. But still, there's got to be a better way to word or handle the deductions.

Guest's picture
Airy

As a business, being able to deduct "green" eco-friendly things you've done with your business/office. They give tax breaks for home owners, why not for businesses too?

Guest's picture

What is the one expense that you wish the IRS would let you deduct for your business and why?

I wish I could deduct my MBA education and expenses. It is helping my business and helps me develop myself. I think alot of people, besides myself could benefit from this.

I would also like to deduct my CPA test prep materials!!

Guest's picture
arun

Businesses should be able to deduct professional development expenses which include training, attending conference.

Guest's picture
Tim

Greater Home Office Deductions for sure, yes its your home, but when your self employed its also your office way to many hours of the day!

Guest's picture
Penny

Mu husband and I have a very small photography business and we only make a small amount as it is. I'm not sure what I wish we could deduct, but I wish the govt would work it so I didn't have to wait to get money back through a tax return and that I get to keep my hard earned cash in my own pocket!

Guest's picture
Tana Inskeep

I think it would be great if we could deduct business related conferences and classes taken to improve our skill.

Guest's picture
Cheryl

They should be able to deduct a portion of the helathcare benefits they provide employees - which may be incentive to gain more benefits.

Guest's picture

I think businesses should be able to deduct for hiring recent college graduates. The unemployment rate swells every May/June with an influx of new job seekers entering the job force. I'm graduating in a few months, and like many of my fellow soon-to-be grads, we're eager to get to work, pay off our loans and stop relying on our parents for financial support. We're up to date on all of the new resources and technology that can help your business, and let's face it, you can pay us less!

Guest's picture
Mikal

With all the technology advances, home businesses should be encouraged by the government. They save resources and most are more environmentally friendly. However, the vague rules for deductions (which sometime are interpreted differently by different sources) discourage home business.
The government (IRS) should simplify the complex rules that apply and help the home business owners operate in a legitimate and profitable way.

Guest's picture
David

What is the one expense that you wish the IRS would let you deduct for your business and why?

Honestly, I am able to deduct quite a bit as a performer and producer. However, since my life is pretty much about work.. I wish I could deduct more of my in home office... but if I deduct the true space I use, no one would believe me.

Guest's picture
Emily

Deducting the full cost of my computer.

Guest's picture
MikeTM

I think businesses should be able to deduct home expenses easier, not require exclusive use.

Guest's picture
Guest

I think drycleaning should be deducted. My suits are my uniform and I only wear them for really important (read: stressful) events. So they have to be drycleaned often:)

Guest's picture
Jeff

I think small businesses should be able to deduct professional development and training to stay competitive in the marketplace.

Guest's picture
Liz N.

Thanks for all the info!

I wish I was able to take the home office deduction. However, my apartment is too small to be able to devote space to only business. There should be a way to calculate the rent/electricity/internet costs that my office consumes, then determine what percentage of that is devoted to work. So, if my work takes up 1/4 of my time, I should be able to deduct 1/4 of my office expenses.

Guest's picture
Steven

Thank you for the valuble information.

Guest's picture

I agree with those commenters who think it should be easier to deduct home offices. It's so difficult to figure out whether or not you qualify for this deduction and if so how much you qualify for.

Guest's picture
Ginny

Sales reps who are independent contractors and on commission only should be allowed to deduct the meals eaten during the usual business day, while out driving to appointments, not just those for out-of-town trips.

Guest's picture
Aaron

First off, FANTASTIC idea for a site. I see lots of folks that will get some real benefit out of it and I think that adding the perks will be a valuable income stream for the outright.com folks.

Something I think shouldn't be deductible is extra compensation in regards to real estate. The way I understand it is that if you buy real estate in your name that the company uses, you can be paid extra compensation by the company for use of the property. Even if it is purposely bought just for the business. This extra compensation is deductible as is your normal pay. This just kinda seems like double dipping to me, but I may be a little fuzzy on the details.

Guest's picture

Education should certainly be deductible. If you're willing to improve your education in an effort to improve your business, you should be able to deduct that (or some) amount.

Better education makes better business. Better business makes the tax man more money. It's only logical.

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Brooke

I think businesses should be able to deduct any expense necessary to run there business. For example a phone line and internet that is used for the business they should be able to deduct these bills. They shouldn't have to pay for it out of pocket or from the revenue that the business makes.

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Desiree

I agree that the self employed should be able to deduct expenses related to professional development. So much of my work as a personal coach is dependent on continued training and techniques. It is a major business expense and should be deductible.

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Ahme

A good deduction would be for improving skills through education related to the business. Education and continuing education course work, workshops too.

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Therese

I think there should be deductions for mileage, professional development and office supplies.

Guest's picture

I'm not a business owner, and I'm not terribly business savvy, so I have no idea how this works, but it occurs to me - in light of today's legislation - that businesses should get tax breaks that scale to the insurance they provide their employees. This would give them incentive to provide really good plans instead of the cheapest they can lay hands on.

Or maybe that's already the case. If so, I think that's awesome.

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Crista

For those of us that have more unusual businesses, I wish the definition of home office equipment was a bit more liberal.

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Teresa

I think small business should be able to deduct travel expenses.

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Ruthie

I don't have a business, but I think small businesses should be able to deduct education/professional development expenses to be able to keep up a skill set in an industry.

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Em

There should be a flat mileage amount that any business can claim, so that only those with high mileage need to undertake the onerous recordkeeping.

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saudade

Deductions for providing healthcare to employees is something I could really get behind!

I also think that insurance deductions should be able to be taken by a self-employed person even if their spouse has an option to add them to their insurance but doesn't.

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Guest

Anything related to health care and education should be a deduction.

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Cynthia

I'm probably wrong, I think when you work from home, you can deduct the miles you drive from home to your worksite, but not the work-site back home. As in, you had to drive there for the meeting, but then you're "punched out" and have to drive home like everyone else. I think those miles should be deductible round-trip, because I wouldn't be way across town if I wasn't there for work reasons.

Carlos Portocarrero's picture

I think educational stuff should be allowed. And any kind of training or further education on efficiency and becoming more green should also be kosher with the tax man.

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Kristine

I believe small business owners should be able to deduct healthcare costs provided to the owner and employess either in whole or as an increasing percentage of what the business pays. This way the businesses have an incentive to provide better healthcare packages.

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Laura

I wish that there was a deduction that you could take for all the time you spend on the business that you don't get paid for. Starting a small business is very time consuming and you don't want to pay yourself for all the time spent at the beginning, because you aren't bringing in enough money. If there was a right-off for this, it would make it a little bit more worthwhile.

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Laura

I wish that there was a deduction that you could take for all the time you spend on the business that you don't get paid for. Starting a small business is very time consuming and you don't want to pay yourself for all the time spent at the beginning, because you aren't bringing in enough money. If there was a right-off for this, it would make it a little bit more worthwhile.

Guest's picture
P

I don't own a small business but I strongly believe they should be able to deduct the cost(s) for education and training towards advanced degree or certification related to their line of work. Also, with so much push towards technology, there should be some sort of credit if you replace your old equipment with new (energy saving?) machines or computers.

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Laura

The changes that I'd like to see for business deductions, have to do with business use of your home. The rules require you to have a specific space to claim and the size of that space determines the percentage of deductions you can claim. I work all over my home. With wireless Internet, who needs an office space any more?

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Eric

This is the first year I've taken the home office expense (I started working from home this year, and when I moved away from New York where my transcription job is located, they switched me from W-2 to 1099), and I agree that it should be more clearly defined. While you may use your computer room as your office, other parts of your house may get use that wouldn't normally, including some utilities, and it's hard to really quantify that in your taxes.

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Songbird

Health insurance and education.

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Arthur Fox

Nice tips on taxes

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kara

What is the one expense that you wish the IRS would let you deduct for your business and why?

I am a business owner and I think donated services should be able to be deducted.

Guest's picture
Tabtha

Business owners should be able to deduct personal and employee development costs, advertising and health care costs.