Posts Tagged ‘Adjusted gross income’

An Expense By Any Other Name

September 11, 2013

RoseA tax deduction is a tax deduction is a tax deduction.

People ask me all the time “What should I call this expense or that?” If you can show that there is a business purpose, it doesn’t matter to the IRS what you call it.  What is important is what it means to you in managing your business.

If you purchase an inkjet cartridge to print off brochures, you could call it computer supplies, advertising, office supplies, printing or anything else that has a meaning for you.

I once had a client bring in her list of expenses and saw a category called ESP.  When I asked her what that was, she told me Error Some Place.  Since it took place in her business account, we took the deduction (of course we called it something else).  And at the same time don’t use a label that will call attention to the deduction either.

The important thing is to keep your records and receipts so that when the IRS asks, you can easily support your deductions.


%d bloggers like this: