- August 19th, 2013
- John Dillard
- IRS Representation, Back Taxes, Offer in Compromise, IRS Tax Problems, Tax Advocacy
These basic tax tips will do much to ensure that you keep adequate books and records to support your business deductions as well as to ensure that you will have much of the documentation that an IRS agent will want to see during the performance of an audit. Being prepared is your best bet and it starts each and every day by keeping good books and records so that if the tax man cometh that you are prepared and ready to support the business expenses you have claimed. Having served as a CPA to Tucker and Lilburn area for decades I have learned that starting with the basics and fundamentals of sound recordkeeping is always a prudent and wise choice.
Tax Tips to Ensure Adequate Business Receipt Documentation:
- For meals and entertainment please be sure to keep receipts from restaurants (credit card receipt not sufficient) and document in detail and the nature of the business discussion.
- For all travel overnight, please be sure to keep all contacts and supporting information so that you can prove nature of trips, who you met with and have documentation and supporting papers verifying the nature of all of your business trips.
- For all cell phones, deduct only the portion that is business use.
- I suggest not claiming home office deduction in the future. If however you opt to, I suggest you take pictures and keep proof including layout/plans of house detailing how much of the home is used exclusively for business use. Any portion of home also used for personal use cannot be claimed/deducted for the home office deduction.
- Pay all expenses by check as items are incurred (do not wait until year-end to record) being sure to have an adequate and detailed receipt clearly indicating the business nature of any and all expenditures. Also keeping all of the canceled checks and bank statements are critical to having substantive corroborating information.
- Get reimbursed for all business expenses you personally paid cash for being sure to have clear receipts for all business expenditures.
- Evaluating incorporating your business if you plan to continue to grow it, for both legal personal protection and potential tax savings when business becomes profitable.
- Being sure to keep a by day log to support and detail all business miles.
www.HisCPA.com A Christian CPA Firm in Duluth GA Proudly Offering Corporate and Personal Income Tax Returns, Offer in Compromise, Tax Advocacy, Tax Mitigation and Tax Compliance, Back Taxes, IRS Representation, IRS Appeals, IRS Collections, IRS Installment Plans & IRS Wage Levies