query: Intentions of Deductible Amount for Small Business

positive: "If your sole proprietorship losses exceed all other sources of taxable income, then you have what's called a Net Operating Loss (NOL). You will have the option to ""carry back"" and amend a return you filed in the last 2 years where you owed tax, or you can ""carry forward"" the losses and decrease your taxes in a future year, up to 20 years in the future. For more information see the IRS links for NOL. Note: it's important to make sure you file the NOL correctly so I'd advise speaking with an accountant. (Especially if the loss is greater than the cost of the accountant...)"

negative: ">a startup has every intention of doing right.  Most self-identified ""startups"" I have known (as distinguished from actual profit-seeking ""small businesses"") have, as their primary intent, the long-term goal of *selling shares to investors*.   This is different from an actual *business* that sells products to customers. I'm sometimes a little skeptical."

negative: $4,000 is a relatively small amount in the grand scheme of retirement. I think you should decide in general whether a Traditional or Roth makes more sense for you (with the intent that you will continue contributing to it in the future), and then treat the $4,000 like you would any other contribution.

negative: "I am going to keep things very simple and explain the common-sense reason why the accountant is right: Also, my sister in law owns a small restaurant, where they claim their accountant informed them of the same thing, where a portion of their business purchases had to be counted as taxable personal income. In this case, they said their actual income for the year (through their paychecks) was around 40-50K, but because of this detail, their taxable income came out to be around 180K, causing them to owe a huge amount of tax (30K ish). Consider them and a similarly situated couple that didn't make these purchases. Your sister in law is better off in that she has the benefit of these purchases (increasing the value of her business and her expected future income), but she's worse off because she got less pay. Presumably, she thought this was a fair trade, otherwise she wouldn't have made those purchases. So why should she pay any less in taxes? There's no reason making fair trades should reduce anyone's tax burden. Now, as the items she purchased lose value, that will be a business loss called ""depreciation"". That will be deductible. But the purchases themselves are not, and the income that generated the money to make those purchases is taxable. Generally speaking, business gains are taxable, regardless of what you do with the money (whether you pay yourself, invest it, leave it in the business, or whatever). Generally speaking, only business losses or expenses are deductible. A purchase is an even exchange of income for valuable property -- even exchanges are not deductions because the gain of the thing purchased already fairly compensates you for the cost. You don't specify the exact tax status of the business, but there are really only two types of possibilities. It can be separately taxed as a corporation or it can be treated essentially as if it didn't exist. In the former case, corporate income tax would be due on the revenue that was used to pay for the purchases. There would be no personal income tax due. But it's very unlikely this situation applies as it means all profits taken out of the business are taxed twice and so small businesses are rarely organized this way. In the latter case, which is almost certainly the one that applies, business income is treated as self-employment income. In this case, the income that paid for the purchases is taxable, self-employment income. Since a purchase is not a deductible expense, there is no deduction to offset this income. So, again, the key points are: How much she paid herself doesn't matter. Business income is taxable regardless of what you do with it. When a business pays an expense, it has a loss that is deductible against profits. But when a business makes a purchase, it has neither a gain nor a loss. If a restaurant buys a new stove, it trades some money for a stove, presumably a fair trade. It has had no profit and no loss, so this transaction has no immediate effect on the taxes. (There are some exceptions, but presumably the accountant determined that those don't apply.) When the property of a business loses value, that is usually a deductible loss. So over time, a newly-purchased stove will lose value. That is a loss that is deductible. The important thing to understand is that as far as the IRS is concerned, whether you pay yourself the money or not doesn't matter, business income is taxable and only business losses or expenses are deductible. Investments or purchases of capital assets are neither losses nor expenses. There are ways you can opt to have the business taxed separately so only what you pay yourself shows up on your personal taxes. But unless the business is losing money or needs to hold large profits against future expenses, this is generally a worse deal because money you take out of the business is taxed twice -- once as business income and again as personal income. Update: Does the business eventually, over the course of the depreciation schedule, end up getting all of the original $2,000 tax burden back? Possibly. Ultimately, the entire cost of the item is deductible. That won't necessarily translate into getting the taxes back. But that's really not the right way to think about it. The tax burden was on the income earned. Upon immediate replacement, hypothetically with the exact same model, same cost, same 'value', isn't it correct that the ""value"" of the business only went up by the amount the original item had depreciated? Yes. If you dispose of or sell a capital asset, you will have a gain or loss based on the difference between your remaining basis in the asset and whatever you got for the asset. Wouldn't the tax burden then only be $400? Approximately, yes. The disposal of the original asset would cause a loss of the difference between your remaining basis in the asset and what you got for it (which might be zero). The new asset would then begin depreciating. You are making things a bit more difficult to understand though by focusing on the amount of taxes due rather than the amount of taxable gain or loss you have. They don't always correlate directly (because tax rates can vary)."

negative: My basic rule of thumb is that if the the bill come from a government office of taxation, and that if you fail to pay the amount they can put a tax lien on the property it is a tax. for you the complication is in Pub530: Assessments for local benefits.    You cannot deduct amounts you pay for local benefits that tend to increase the value of your property.   Local benefits include the construction of streets, sidewalks, or   water and sewer systems. You must add these amounts to the basis of   your property.  You can, however, deduct assessments (or taxes) for   local benefits if they are for maintenance, repair, or interest   charges related to those benefits. An example is a charge to repair an   existing sidewalk and any interest included in that charge.  If only a   part of the assessment is for maintenance, repair, or interest   charges, you must be able to show the amount of that part to claim the   deduction. If you cannot show what part of the assessment is for   maintenance, repair, or interest charges, you cannot deduct any of it. An assessment for a local benefit may be listed as an item in your   real estate tax bill. If so, use the rules in this section to find how   much of it, if any, you can deduct. I have never seen a tax bill that said this amount is for new streets, and the rest i for things the IRS says you can deduct. The issue is that if the Center City tax bill is a separate line or a separate bill then does it count. I would go back to the first line of the quote from Pub 530: You cannot deduct amounts you pay for local benefits that tend to   increase the value of your property. Then I would look at the quote from the CCD web site: The Center City District (CCD) is a business improvement district. Our   mission is to keep Philadelphia's downtown, called Center City, clean,   safe, beautiful and fun. We provide security, cleaning and promotional   services that supplement, but do not replace, basic services provided   by the City of Philadelphia and the fundamental responsibilities of   property owners. CCD also makes physical improvements to the downtown, installing and maintaining lighting, > signs, banners, trees and landscape elements.  and later on the same page: CCD directly bills and collects mandatory payments from properties in   the district. CCD also receives voluntary contributions from the   owners of tax-exempt properties that benefit from our services. The issues is that it is a business improvement district (BID), and you aren't a business: I did find this document from the city of Philadelphia explain how to establish a BID: If the nature of the BID is such that organizers wish to include   residential properties within the district and make these properties   subject to the assessment, it may make sense to assess these   properties at a lower level than a commercial property, both because   BID services and benefits are business-focused, and because   owner-occupants often cannot treat NID assessments as tax-deductible   business expenses, like commercial owners do. Care must be taken to   ensure that the difference in commercial and residential assessment   rates is equitable, and complies with the requirements of the CEIA. from the same document: Funds for BID programs and services are generated from a special   assessment paid by the benefited property owners directly to the   organization that manages the BID’s activities. (Note: many leases   have a clause that allows property owners to pass the BID assessment   on to their tenants.) Because they are authorized by the City of   Philadelphia, the assessment levied by the BID becomes a legal   obligation of the property owner and failure to pay can result in the   filing of a lien. I have seen discussion that some BIDS can accept tax deductible donations. This means if a person itemizes they can deduct the donation. I would then feel comfortable deducting the tax because: If you can't deduct it that would mean the only people who can't deduct it are home owners.  So deduct it. (keep in mind I am not a tax professional)

negative: In the US there's no significant difference between what a business can deduct and what an individual can deduct. However, you can only deduct what is an expense to produce income. Businesses are allowed to write off salaries, but individuals can't   write off what they pay their gardener or maid (at least in the US) If you're a sole proprietor in the business of managing properties - you can definitely deduct payments to gardeners or maids. Business paying for a gardener on a private property not related to producing the income (like CEO's daughter's house) cannot deduct that expense for tax purposes (although it is still recorded in the business accounting books as an expense - with no tax benefit). Businesses are allowed to deduct utility expenses as overhead, individuals cannot Same thing exactly. I can deduct utility expenses for my rental property, but not for my primary residence. Food, shelter, clothing and medical care are fundamental human needs,   but we still pay for them with after-tax money, and pay additional   sales tax. Only interest (and not principal) on a mortgage is   deductible in the US, which is great for people who take out mortgages   (and helps banks get more business, I'm sure), but you're out of luck   if you pay cash for your house, or are renting. Sales taxes are deductible. You can deduct sales taxes you paid during the year if you itemize your deduction. You can chose - you either deduct the sales taxes or the State income taxes, whatever is more beneficial for you. BTW in many states food and medicine are exempt from sales tax. Medical expenses are deductible if they're significant compared to your total income. You can deduct medical expenses in excess of 10% of your AGI. With the ACA kicking in - I don't see how would people even get to that. If your AGI is low you get subsidies for insurance, and the insurance keeps your expenses capped. For self-employed and employed, insurance premiums are pre-tax (i.e.: not even added to your AGI). Principle for mortgage is not deductible because it is not an expense - it is equity. You own an asset, don't you? You do get the standard deduction, even if your itemized (real) deductions are less - business don't get that. You also get an exemption amount (for your basic living needs), which businesses don't get. You can argue about the amounts - but it is there. In some States (like California) renters get tax breaks for renting, depending on the AGI. CA renters credit is phasing out at AGI of about $60K, which is pretty high.

negative: Perhaps someone has an investment objective different than following the market. If one is investing in stocks with an intent on getting dividend income then there may be other options that make more sense than owning the whole market. Secondly, there is Slice and Dice where one may try to find a more optimal investment idea by using a combination of indices and so one may choose to invest 25% into each of large-cap value, large-cap growth, small-cap value and small-cap growth with an intent to pick up benefits that have been seen since 1927 looking at Fama and French's work.

negative: There are so many companies listed in the Dubai business directory &  UAE Business with email address. Database For Business is   supporting to the business database service to keep the secure business data. Now, you can get database service at the affordable price. It is specially designed for those people who want to get the best service at the lowest price, we also support them. We have a lot of database services for the user and also ensure that what's new business directory? Our professional team also offers a great database solution, basically our intention to provide a reliable Dubai companies list with email address and powerful information document. We are increasing the amount of database companies acquire and the complex database administration issues they face.

negative: "1) Indeed, if referring to a Roth as the question is, you are right on. But - You can deposit to an Traditional IRA (TIRA). You just can't deduct it. You are then permitted to convert that to a Roth any time. Now, this would appear to negate income issues, right? Not so fast. When you convert, all TIRA accounts must be considered. In other words, when it comes to the TIRA, you only have One TIRA, the ""A"" actually standing for Arrangement, not account. That TIRA may then be spread over as many accounts as you have time to set up. So, if there is any pretax money and/or untaxed gain, it will be prorated and taxed based on your conversion amount. If any of this is not 110% clear, please comment and I will update the answer.  No 401(k) at work?  Note: I edited as my original wording misunderstood the response, and in turn, appeared a bit unkind. Not my intention."

negative: As far as i understand the big companies on the stock markets have automated processes that sit VERY close to the stock feeds and continually processes these with the intention of identifying an opportunity to take multiple small lots and buy/sell them as a big lot or vice/versa and do this before a buy or sell completes, thus enabling them to intercept the trade and make a small profit on the delta. With enough of these small gains on enough shares they make big profits and with near zero chance of losing.

negative: "For simplicity, let's start by just considering cash back. In general, cash back from credit cards for personal use is not taxable, but for business use it is taxable (sort of, I'll explain later). The reason is most personal purchases are made with after tax dollars; you typically aren't deducting the cost of what you purchased from your personal income, so if you purchase something that costs $100 and you receive $2 back from the CC company, effectively you have paid $98 for that item but that wouldn't affect your tax bill. However, since businesses typically deduct most expenses, that same $100 deduction would have only been a $98 deduction for business tax purposes, so in this case the $2 should be accounted for. Note, you should not consider that $2 as income though; that would artificially inflate your revenue. It should be treated as a negative expense, similar to how you would handle returning an item you purchased and receiving a CC refund. Now for your specific questions: Part 1: As a small business owner, I wish to attend an annual seminar to improve my business. I have enough credit card reward points to cover the airfare, hotel, and rental car. Will those expenses still be deductible at the value displayed on the receipt? Effectively no, these expenses are not deductible. If you deduct them they will be completely counter-acted by the ""refund"" you receive for the payments. Part 2: Does it matter if those points are accrued on my personal credit card, rather than a business credit card? This is where it gets hairy. Suppose your company policy is that employees make purchases with their own personal credit cards and submit receipts for reimbursement. In this case the employer can simply reimburse and would not know or care if the employee is racking up rewards/points/cashback. The trick is, as the employee, you must always purchase business related items normally so you have receipts to show, and if you receive cashback on the side there seems to be a ""don't ask, don't tell"" rule that the IRS is OK with. It works the same way with heavy business travelers and airline miles- the free vacations those users get as perks are not treated as taxable income. However, I would not go out of my way to abuse this ""loophole"". Typically, things like travel (airfare, hotel, car rental, meals) are expected. But I wouldn't go purchase 100 company laptops on your personal card and ask the company to reimburse you. The company should purchase those 100 laptops on a company card and effectively reduce the sale price by the cashback received. (Or more realistically, negotiate a better discount with your account rep and just cut them a check.) Part 3: Would there be any difference between credit card points and brand-loyalty points? If the rental car were paid for with points earned directly on the rental car company's loyalty system (not a CC), would that yield a different result? There is no difference. Perhaps the simplest way to think about this is you can only deduct an expense that you actually incur. In other words, the expense should show up on a bank or CC statement. This is why when you volunteer and work 10 hours for a charity, you can't call that a ""donation"" of any amount of money because there is no actual payment made that would show up on a bank statement. Instead you could have billed the charity for your 10 hours of work, and then turned around and donated that same amount back to them, but it ends up being a wash."

negative: Delaware LLC requires that each business entity have and hold an enterprise Registered in the State of Delaware who can be both a character resident or enterprise entity this is legal to do business in the  Wilmington, Delaware. the Delaware LLC has offered the same asset protections and tax advantages that a corporation offers. Often the LLC is the simpler, more flexible choice for small businesses. This small amount of required information not only makes it easy to start an LLC in Delaware, but it also helps to keep your identity and personal information secure.

negative: Does anyone else think that all this facebook snafu was intentional to put egg on the face of sniveling mark zuckerberg? It seems like many in the business world treat him as though he got lucky not that he is a savy business person.

negative: "No. One of the key ideas behind a corporation is that an investor's liability is limited to the amount he invests, i.e. the amount of stock he buys. This is the primary reason why small businesses become corporations, even though one person owns 100% of the stock. Then if the business goes broke, he won't lose his house, retiretment fund, etc. He'll lose everything he had in the business, but at least there's a limit to it. (In some countries there are other ways to achieve the same results, like creating a ""limited liabililty company"", but that's another story.)"

negative: To a certain extent, small cap companies will in general follow the same trends as large cap companies. The extent of this cointegration depends on numerous factors, but a prime reason is the presence of systemic risk, i.e. the risk to the entire market. In simple terms, sthis is the risk that your portfolio will approach asymptotically as you increase its diversification, and it's why hedging is also important.  That being said, small cap businesses will, in general, likely do worse than large cap stocks, for several reasons. This was/is certainly the case in the Great Recession.  Small cap businesses have, on average, higher betas, which is a measure of a company's risk compared to the overall market. This means that small cap companies, on average outperform large cap companies during boom times, but it also means that they suffer more on average during bear times. The debate over whether or not the standard beta is still useful for small cap companies continues, however. Some economists feel that small cap companies are better measured against the Russell 2000 or similar indexes instead of the S&P 500.  Small cap companies may face problems accessing or maintaining access to lines of credit. During the Great Recession, major lenders decreased their lending to small businesses, which might make it harder for them to weather the storm.  On a related point, small businesses might not have as large an asset base to use as collateral for loans in bad times. One notable large cap company that used its asset base to their advantage was Ford, which gave banks partial ownership of its factories during hard times. This a) gave Ford a good amount of cash with which to continue their short-term operations, and b) gave the banks a vested interest in keeping Ford's lines of credit open. Ford struggled, but it never faced the financial problems of GM and Chrysler.  Despite political rhetoric about Main Street vs. Wall Street, small businesses don't receive as much government aid in times of crisis as some large cap companies do. For example, the Small Business Lending Fund, a brilliant but poorly implemented idea in 2010, allocated less than $30 billion to small businesses. (The actual amount loaned was considerably less). Compare that to the amounts loaned out under TARP. Discussions about corporate lobbying power aside, small businesses aren't as crucial to the overall stability of the financial system Small businesses don't always have the manpower to keep up with changes in regulation. When the Dodd-Frank Act passed, large banks (as an example), could hire more staff to understand it and adapt to it relatively easily; small banks, however, don't always have the resources to invest in such efforts.  There are other reasons, some of which are industry-specific, but these are some of the basic ones.  If you want visual confirmation that small cap businesses follow a similar trend, here is a graph of the Russell 2000 and S&P 500 indexes:  Here is a similar graph for the Russell 2000 and the Dow Jones Industrial Average.   If you wanted to confirm this technically and control for the numerous complicated factors (overlap between indexes, systemic risk, seasonal adjustment, etc.), just ask and I'll try to run some numbers on it when I have a chance. Keep in mind, too, that looking at a pretty picture is no substitute for rigorous financial econometrics. A basic start would be to look at the correlation between the indexes, which I calculate as 0.9133 and 0.9526, respectively. As you can see, they're pretty close. Once again, however, the reality is more complicated technically, and a sufficiently detailed analysis is beyond my capabilities. Just a quick side note. These graphs show the logarithm of the values of the indexes, which is a common statistical nuance that is used when comparing time series with radically different magnitudes but similar trends.  S&P500 and Russell 2000 data came from Yahoo! Finance, and the Dow Jones Industrial Average data came from Federal Reserve Economic Data (FRED) Per usual, I try to provide code whenever possible, if I used it. Here is the Stata code I used to generate the graphs above. This code assumes the presence of russell2000.csv and sp500.csv, downloaded from Yahoo! Finance, and DJIA.csv, downloaded from FRED, in the current directory.  Fidelity published an article  on the subject that you might find interesting, and Seeking Alpha has several pieces related to small-cap vs. large-cap returns that might be worth a read too.

negative: Taking every court to case isn't in the best interest of the public either (on a net basis). Often those settlements accept the fine, but dong admit guilt. This can be important in federally regulated industries where guilt would result in automatic suspension of licenses and practice. Those regulations were put in place knowing that most companies would settle.  Also, there's valid reason for deducting the settlement! In many businesses lawsuits are ordinary expenses (consumer facing ones with lots and lots of employees). People being up frivolous suits all the time and it's cheaper to settle for a small amount than pay expansive attorneys to go to court. Effectively, it's like an admin expense, we don't tax revenue, we tax profit.  Finally, this would seriously clog courts, and jury's can be crazy biased to emotional stories.   Yes, some parts could be changed, but it serves a valid purpose.

negative: "First, let's look at the tax brackets for single taxpayers in 2016: The cutoff between the 25% and 28% tax bracket is $91,150.  You said that your gross is $87,780.  This will be reduced by deductions and exemptions (at least $10,350).  Your rental income will increase your income, but it is offset in part by your rental business expenses. For this year, you will almost certainly be in the 25% bracket, whether or not you receive your backpay this year.  Next year, if you receive your backpay then and your salary is $11k higher, I'm guessing you'll be close to the edge. It is important to remember that the tax brackets are marginal.  This means that when you move up to the next tax bracket, it is only the amount of income that puts you over the top that is taxed at the higher rate.  (You can see this in the chart above.)  So if, for example, your taxable income ends up being $91,160, you'll be in the 28% tax bracket, but only $10 of your income will be taxed at 28%.  The rest will be taxed at 25% or lower.  As a result, this probably isn't worth worrying about too much. A bit more explanation, requested by the OP: Here is how to understand the numbers in the tax bracket chart.  Let's take a look at the second line, $9,276-$37,650.  The tax rate is explained as ""$927.50 plus 15% of the amount over $9,275.""  The first $9,275 of your taxable income is taxed at a 10% rate.  So if your total taxable income falls between $9,276 and $37,650, the first $9,275 is taxed at 10% (a tax of $927.50) and the amount over $9,275 is taxed at 15%.  On each line of the chart, the amount of tax from all the previous brackets is carried down, so you don't have to calculate it. When I said that you have at least $10,350 in deductions and exemptions, I got that number from the standard deduction and the personal exemption amount.  For 2016, the standard deduction for single taxpayers is $6,300.  (If you itemize your deductions, you might be able to deduct more.)  Personal exemptions for 2016 are at $4,050 per person.  That means you get to reduce your taxable income by $4,050 for each person in your household.  Since you are single with no dependents, your standard deduction plus the personal exemption for yourself will result in a reduction of at least $10,350 on your taxable income."

negative: "Summarized article: In Canada, Jennifer Desloges, owner of an electrolysis business, is accusing Yelp, a user review website, of hurting businesses by burying positive reviews and lowering ratings.   Desloges encouraged her customers to post real comments about her business on the Yelp site. 17 customers posted positive reviews which boosted her rating to 5 stars but her rating later dropped to 2 1/2 stars when some positive reviews were filtered out.   Yelp uses an algorithm to filter out reviews by users who don't write reviews as often and are not ""trusted"" users. The intent is to filter out fake reviews by those trying to manipulate the system.   Yelp explained that although Desloges received genuine reviews, they were likely filtered out because they were from infrequent Yelp users.  Desloges says the low Yelp rating is causing her to lose potential customers.   Other small business owners have also complained about Yelp's filtering system. Some tried suing Yelp because they claimed Yelp was manipulating user reviews to force them to advertise. The judge said there was no proof of the claims and dismissed the case.  *For more summarized news, subscribe to the [/r/SkimThat](http://www.reddit.com/r/SkimThat) subreddit*"

negative: What if you do need to fly for business? Also, what if you want to get to Europe in less than a few days?  Regardless, TSA has intentions to find their way to all types of transportation as well. End the TSA. Let the airports handle security.

negative: Here is a quote from the IRS website on this topic: You may be able to deduct premiums paid for medical and dental   insurance and qualified long-term care insurance for yourself, your   spouse, and your dependents. The insurance can also cover your child   who was under age 27 at the end of 2011, even if the child was not   your dependent. A child includes your son, daughter, stepchild,   adopted child, or foster child. A foster child is any child placed   with you by an authorized placement agency or by judgment, decree, or   other order of any court of competent jurisdiction. One of the following statements must be true. You were self-employed and had a net profit for the year reported on   Schedule C (Form 1040), Profit or Loss From Business; Schedule C-EZ   (Form 1040), Net Profit From Business; or Schedule F (Form 1040),   Profit or Loss From Farming. You were a partner with net earnings from self-employment for the year   reported on Schedule K-1 (Form 1065), Partner's Share of Income,   Deductions, Credits, etc., box 14, code A. You used one of the optional methods to figure your net earnings from   self-employment on Schedule SE. You received wages in 2011 from an S corporation in which you were a   more-than-2% shareholder. Health insurance premiums paid or reimbursed   by the S corporation are shown as wages on Form W-2, Wage and Tax   Statement. The insurance plan must be established, or considered to be   established as discussed in the following bullets, under your   business. For self-employed individuals filing a Schedule C, C-EZ, or F, a   policy can be either in the name of the business or in the name of the   individual. For partners, a policy can be either in the name of the partnership or   in the name of the partner. You can either pay the premiums yourself   or your partnership can pay them and report the premium amounts on   Schedule K-1 (Form 1065) as guaranteed payments to be included in your   gross income. However, if the policy is in your name and you pay the   premiums yourself, the partnership must reimburse you and report the   premium amounts on Schedule K-1 (Form 1065) as guaranteed payments to   be included in your gross income. Otherwise, the insurance plan will   not be considered to be established under your business. For more-than-2% shareholders, a policy can be either in the name of   the S corporation or in the name of the shareholder. You can either   pay the premiums yourself or your S corporation can pay them and   report the premium amounts on Form W-2 as wages to be included in your   gross income. However, if the policy is in your name and you pay the   premiums yourself, the S corporation must reimburse you and report the   premium amounts on Form W-2 as wages to be included in your gross   income. Otherwise, the insurance plan will not be considered to be   established under your business. Medicare premiums you voluntarily pay to obtain insurance in your name   that is similar to qualifying private health insurance can be used to   figure the deduction. If you previously filed returns without using   Medicare premiums to figure the deduction, you can file timely amended   returns to refigure the deduction. For more information, see Form   1040X, Amended U.S. Individual Income Tax Return. Amounts paid for health insurance coverage from retirement plan   distributions that were nontaxable because you are a retired public   safety officer cannot be used to figure the deduction. Take the deduction on Form 1040, line 29.

negative: "Suppose that I work from home, but do not qualify for a business use   of home deduction. As I understand it, this means I cannot deduct   trips from home to another work location (e.g., going to a client's   home or office to do work there). I do not think this is true. You cannot deduct trips to your main business location, i.e.: you cannot deduct trips to your office or client's location if this is your main client and you routinely work on-site. However, if you only visit your clients on occasion for specific events while doing your routine work at home - you can definitely deduct those trips. The deduction of the home usage itself has nothing to do with it. However, there's a different reason they refer to pub 587. Your home must qualify as principal place of business (even if it doesn't qualify for deduction). The qualifications of ""principal place of business"" are described in pub 587. ""if for some personal reason you do not go directly from one location to the other, you cannot deduct more than the amount it would have cost you to go directly from the first location to the second."" What is not clear to me is what exactly is deductible if there are   significant time gaps (within a single day) between trips to different   clients. You got it right. What this quote means is that if you have client A and client B, and you drive from A to B - you can only deduct the travel between A and B, nothing else. I.e.: if you have 2 hours to kill and you take a trip to the mall - you cannot deduct the mileage attributable to that trip. You only deduct the actual distance between A and B as it would be had you driven from A to B directly. The example you cite re first client being considered as the place of business is for the case where your home doesn't qualify as principal place of business. In this case you start counting miles from your first client, and only for direct trips from client to client. If you only have 1 client in that day, tough luck, nothing to deduct. Also, it's not clear whether stopoffs between clients would really be   ""personal reasons"", since the appointment times are often set by the   client, so it's not as if the delay between A and B was just because I   felt like it; there was never the option of going directly from A to   B. That's what is called ""facts and circumstances"". You can argue that you had enough time between meetings to go back to your home office to continue working. The IRS agent auditing you (and you're likely to get audited) will consider that. Maybe will accept it. Maybe not. If I had a gap like that described above, I could save on my taxes by   going to the park or a hamburger stand instead of going home between A   and B But then you wouldn't be at home, so why would it be ""principal place of business"" if you're not there? Boom, lost deduction for the trip to the first client. I suggest you talk to a licensed tax adviser (EA/CPA licensed in your State). You're dealing with deductions that are considered ""red flags"" for the IRS. I.e.: many people believe that these deductions (business use of your home/car) trigger audits. To substantiate business use of your car you need to keep very good track of your travels (literally travel log, they sell them at Staples), and make sure to distinguish between personal travel and business travel, keep proofs that the meetings took place (although keeping a log is a requirement, it can be backdated/faked, so if audited - the IRS will want to see more than your own documentation). A good tax adviser will educate you on all these rules, and also clarify the complexities you were asking about here. I'm not a tax adviser, so don't rely on this answer when you're preparing your tax return or responding to the IRS audit. In your edit you ask this: Specifically, what I'm wondering is whether it is possible for a home   to qualify as a ""principal place of business"" for purposes of   deducting car expenses but not for the home office deduction. The answer is yes. Deductibility is determined by exclusivity of use, among other things. But the fact that you manage your business from your kitchen doesn't make your kitchen any less of a principal place of business. It is non-deductible because you also cook your dinners there, but it is still, nonetheless, your principal place of business. The Pub 587 which I linked to has these qualifications: Your home office will qualify as your principal place of business if   you meet the following requirements. You use it exclusively and regularly for administrative or management activities of your trade or business. You have no other fixed location where you conduct substantial administrative or management activities of your trade or business. As you see, exclusivity of the usage of your home area is not a requirement here. The ""exclusively and regularly"" in the quote refers to your business not using any other location, and managing it from home regularly. I.e.: if you manage your business a day in a year - that's not enough for it to be considered principal. If you manage your business from your office and your home - you cannot consider home as principal."

negative: Well, to get money, you need to leverage your assets.  So your options basically are:  - Asset: Cash.  Well, I figure if you had, you wouldn't have asked how to get more of it, but its always worth mentioning.  Don't forget about cash that can be in tricky places to tap, like 401ks, IRAs, investment accounts, etc.  There is usually some way to get at the cash, but it may not be worth it and you could end up sacrificing long term financial stability if you do.  - Asset: Job Skills and Initiative.  Get a job and and earn the cash.   $2k is not a ton, and if you live frugally you should be able to save it.  There are tons of websites dedicated to living frugally and earning extra cash on the side.   My personal favorite is r/beermoney.   - Asset: Good Credit. Borrow the money from a traditional bank.  Signature loans go up to $35k at most banks, just ask what it would take to qualify.  You could also get a credit card for that amount, and use it to start up the business.    - Asset. Bad Credit.  If you've got bad credit, you can still take out a loan from a place like Prosper or Lending Club or Sofi (these places are handy if you have good credit, too).  Your rates will be much higher, but they will still lend to you.  - Asset: Property.  If you own stuff, you can sell it and get cash.  Clean out your attic (or ask relatives if you can have the stuff in theirs!) and sell it.  If you own fancy stuff, you can borrow against it (home, car, boat, etc.).  - Asset: Your Charm and Winning Smile.  If you have a good, solid business plan (written down and professional looking), ask around and see if you can find an investor.  It could be friends or family, but it could also be someone who is looking to invest.  Be professional, and be sure to draw up the appropriate business docs if you do a partnership or take a private loan.  - Asset: Your Government.  If you live in the US, there are federal programs that offer Small Business Loans.  Check out sba.gov for more info.  You will need a business plan and will have to meet the criteria of the loan or grant.  Not sure if your Ecommerce business will meet the criteria, as the intent of these types of programs are to spur the economy by allowing small business owners to hire workers.  But its worth checking out.

negative: I can't see how you can deduct your mother's loss. The money was not stolen from you, and you gave money to your mother of your own free will and with full intention of the money to be used by her as she wishes. Moving money from your own account to a joint account allowing the joint holder to use it - is akin to giving the money directly to the joint holder, i.e.: in your case, giving a gift to your mother.

negative: "One topic that I've been trying to learn more about is the affects of the low interest rates on businesses and the economy from quantitative easing. Due to the amount of ""free money"" corporations have received over the last 5 years there has been a few interesting consequences. There are several corporations that have borrowed money at little to no interest with the feds intentions of seeing it go back into the economy however instead corporations have used it to buy back stock which was not necessarily the plan in the first place. You could definitely have a unique thesis written about something within that flow of funds. If that makes no sense apologies stupid undergrad here."

negative: "Could that be that you have been SOLD the notion that antitrust laws are a failed and discredited policy.... by those intent on protecting private cartels? (Republicans). Could it be that the enforcement arm of the government (like the SEC) have been weakened and captured by lobbyists in a revolving door between the private sector and the the government (facilitated by Democrats too)?   With that said, before corporations, we had feudal lords with the same oligopoly/monopoly desires. In capitalism, unchecked greed leads to the destructive behavior of endless accumulation of resources at the expense of others... if you start out from a competitive vantage point. This is the ""free market"" that Republicans harp on about. It is the ""freedom"" to reap your rewards without any obstacles, even if reaping your rewards means gauging customers because you have swallowed up the competition. This is what Republicans want (and what libertarians are too naive to understand). How does this environment protect the small business or how does it benefit consumers?"

negative: You are faced with a dilemma. If you use a 529 plan to fund your education, the short timeline of a few years will limit your returns that are tax free. Most people who use a 529 plan either purchase years of tuition via lump sum, when the child is young; or they  put aside money on a regular basis that will grow tax deferred/tax free. Some states do give a tax break when the contribution is made by a state taxpayer into a plan run by the state. The long term plans generally use a risk profile that starts off heavily weighted in stock when the child is young, and becomes more fixed income as the child reaches their high school years. The idea is to protect the fund from big losses when there is no time to recover. If you choose the plan with the least risk the issue is that the amount of gains that are being protected from federal tax is small. If you pick a more aggressive plan the risk is that the losses could be larger than the state tax savings. Look at some of the other tax breaks for tuition to see if you qualify Credits An education credit helps with the cost of higher education by   reducing the amount of tax owed on your tax return. If the credit   reduces your tax to less than zero, you may get a refund. There are   two education credits available: the American Opportunity Tax Credit   and the Lifetime Learning Credit. Who Can Claim an Education Credit? There are additional rules for each credit, but you must meet all   three of the following for either credit: If you’re eligible to claim the lifetime learning credit and are also   eligible to claim the American opportunity credit for the same student   in the same year, you can choose to claim either credit, but not both.   You can't claim the AOTC if you were a nonresident alien for any part   of the tax year unless you elect to be treated as a resident alien for   federal tax purposes. For more information about AOTC and foreign   students, visit American Opportunity Tax Credit - Information for   Foreign Students. Deductions Tuition and Fees Deduction You may be able to deduct qualified education expenses paid during the   year for yourself, your spouse or your dependent. You cannot claim   this deduction if your filing status is married filing separately or   if another person can claim an exemption for you as a dependent on his   or her tax return. The qualified expenses must be for higher   education. The tuition and fees deduction can reduce the amount of your income   subject to tax by up to $4,000. This deduction, reported on Form 8917,   Tuition and Fees Deduction, is taken as an adjustment to income. This   means you can claim this deduction even if you do not itemize   deductions on Schedule A (Form 1040). This deduction may be beneficial   to you if, for example, you cannot take the lifetime learning credit   because your income is too high. You may be able to take one of the education credits for your   education expenses instead of a tuition and fees deduction. You can   choose the one that will give you the lower tax.

negative: "Please declare everything you earn in India as well as the total amount of assets (it's called FBAR). The penalties for not declaring is jail time no matter how small the amount (and lots of ordinary people every 2-3 years are regularly sent to jail for not declaring such income). It's taken very seriously by the IRS - and any Indian bank who has an office in the US or does business here, can be asked by IRS to provide any bank account details for you. You will get deductions for taxes already paid to a foreign country due to double taxation, so there won't be any additional taxes because income taxes in US are on par or even lower than that in India. Using tricks (like transferring ownership to your brother) may not be worth it. Note: you pay taxes only when you realize gains anyway - both in India or here, so why do you want to take such hassles.  If you transfer to your brother, it will be taxed only until you hold them. Make sure you have exact dates of gains between the date you came to US and the date you ""gifted"" to your brother. As long as you clearly document that the stocks transferred to your brother was a gift and you have no more claims on them, it should be ok, but best to consult a CPA in the US. If you have claims on them, example agreement that you will repurchase them, then you will still continue to pay taxes. If you sell your real estate investments in India, you have to pay tax on the gains in the US (and you need proof of the original buying cost and your sale). If you have paid taxes on the real estate gains in India, then you can get deduction due to double tax avoidance treaty. No issues in bringing over the capital from India to US."

negative: That all makes sense, but all of those things are the responsibility of the cardholder.  If you want to pay off your balance, anything quoted would obviously not include any transaction yet to post.  The problem is a creditor refusing to give the balance AND refusing to take a payment for an amount over the previous statement balance. This is essentially forcing the customer to pay more interest after they declare their intent to pay the full amount.  Good points, but I don't believe those were factors in this case.

negative: "Anytime you do work without any payment until the work is complete, you are effectively extending credit to the party receiving your service. How much credit you are willing to extend will vary greatly, depending on the amount and the trustworthiness of the party. For example, if you are charging $50 for something, you probably won't bother to collect money upfront, whereas if you are charging $5,000 you probably would collect some upfront. But if the party you are working for is a large financially sound company, the number may be even much higher than $5K as you can trust you will be paid. Obviously there are many factors that go into how much credit you are willing to extend to your customer. (This is why credit reports exist for banks to determine how much credit to extend to you.) As for the specific case you are asking about, which may be classified as a decent amount of work for a small business, I would default to having a written scope of work, a place in the document for both parties to sign, and specify 50% upfront payment and 50% payment at completion. When you receive the signed document and the upfront payment (and possibly even after the check clears), you begin work. I would call this my ""default contract"" and adjust according to your needs depending on the size of the job and the trustworthiness of the customer. As for your question about how to deposit the check, that depends on what type of entity you are. If you are a sole proprietor you should ask for the checks to be made out to you. If you are a business then the checks should be made out to your business name. You don't need ""in trust"" or anything similar because your customer, after paying the upfront fee, must trust that you will do the work you promise to do, just like you have to trust that after completing the work you will receive the final payment. This is the reason the default is 50% before and after. Both parties are risking (roughly) the same amount. Tip: having done the ""default"" contract many times in my career, both as a sole proprietor and a business owner, I can assure you there is a big difference between a potential customer agreeing to something in advance, and actually writing a check. The upfront payment definitely helps weed out those that were never going to end up paying you, even if their intentions were good. Tip 2: be as specific as possible as to what the scope of work will include. If you don't, particularly with software, they'll be adding feature after feature and expecting it to be ""included""."

negative: 1) I don't give a goddam about what Romney said. That's not what *I'm* talking about, and I have no interest in defending or attacking it. You brought up Romney, no one else is talking about him.  2) The state is just as able to make or take *your* personhood as it is a corporations. That blade cuts every direction, remember. Of course corporations are only imbued with personhood (which they aren't, really, it's not like they can vote) because the state says they are. No one said otherwise.   3) >my personal expenses such as food, car maintenance, rent, etc were not tax deductible  They most certainly would be if you had your business in your home, discussed business at every meal, and used your car for work.  Turns out, a corporation uses the things it owns for business, and thus gets to deduct them as business expenses.  It's also possible for businesses to have expenses that are not deductible. Entertainment expenses, for example, are not deductible.

negative: I can't believe they will tax robots, in Korea, or anywhere else. Yeh, sure, business will agree to that and it surely will help business.  A robot tax is a tax on net income of a business.  If they were serious about Robot tax, then they should have taxed machines first and long time ago. As you know, machines replace more humans than robots do, and machines have much higher productivity than robots.  What's next? Tax computer programs because they automate and replace the work done by humans?   Tax AI because it replaces humans who currently do this analytic work?  Look, it would be silly to tax a machine or robot that does work that no human wants to do or can do.  If the intentions is because Korea wants/need more money from taxes, then tax outsourced work, done by other humans, in countries where labor is cheaper. Or, simply tax the business profits because robots increase their profits.  If the intentions is save jobs done by humans, then regulate robots and, for example, make it a rule that every group of robots must be supervised by humans, or customer service must be done by a human and not a robot/AI.

negative: >  The vast majority of companies in the US are small businesses  This is a fairly useless measure.  Example:  Imagine if there was one company that hired 1 billion people.  And 99 companies that hired 1 person each.  You can now say that 99% of companies are small businesses.  Which is true, but 99.9999999% of people don't work for a small business, they work for a large business.  The small businesses are inconsequential.

negative: I read this story last night and it made me laugh. I don't drink their beer. The best beer is locally produced by small private breweries who have no intention of going public. They aren't going anywhere. In fact, they are growing bigger. A lot of people love bland beer. If you like flavor, turn to a local brewpub! Given the choice of Budweiser and American made Spaten, I choose red wine! I would rather drink a bad red wine then a bad beer.