"Steve Stewart" <steve[at]nospam.com> wrote:

- quote -

It is nearly always better to use the standard mileage
allowance. Otherwise you would still need mileage details
to allocate your car between business and non-business use.
You would not take car payments as an expense unless they
are lease payments. If you elect NOT to use the standard 36
cent mileage allowance, then you would need to depreciate
the car using the MACRS rules.

Your cell phone and internet expense would also be allocated
if used for both business and personal use. If 100%
business, then the full cost would be deductible on Schedule
C.

If you work at home you can deduct home office
expenses--otherwise deduct office rent and related expenses.

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"Steve Stewart" <steve[at]nospam.com> wrote:

- quote -

Steve: You have enough issues here to warrant the services
of a tax professional. In general, deductibility of these
items (forget "car payment" for a minute - that's even more
complex) will depend on business use percentage. It is
also important to know whether you have an area in your home
that is regularly and exclusively used for business. You
may or may not have non-deductible commuting. You may or
may not be better off using the standard mileage rate
instead of actual expenses. Etc. Etc. Please see a tax
pro.

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"Steve Stewart" <steve[at]nospam.com> wrote:

- quote -

Start with IRS Publication 17

Gene E. Utterback, EA

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Steve Stewart <steve[at]nospam.com> writes:

- quote -

Download Schedule C (Form 1040) "Profit or Loss from
Business" to get an idea of categories of expense. On page
2, you may develop categories peculiar to your particular
type of business. Business use of your cell phone, internet
connection, phone, beeper, etc. may be one of those
categories. Your vehicle expense is deductible at actual
cost (including insurance, gas, repairs, depreciation, etc)
or at a rate of 36.5 cents per mile (which includes an
amount for depreciation). Your car payment is not a
deductible item. The only portion which MAY be deductible,
if you use actual expenses, would be interest paid on that
expense. You may also be able to deduct Office in Home
Expense. Depreciation of equipment, furnishings, and other
property is another factor.

Your best bet is to consult a professional who can guide you
in a way to keep your books and help you get the greatest
advantage of available deductions. Your savings are likely
to be much greater than the cost for such service.

Here's the link to Schedule C:

http://www.irs.gov/pub/irs-pdf/f1040sc.pdf

"Jack" - John H. Fisher - TaxService[at]aol.com
Philadelphia, Pa - Atlantic City, NJ - West Wildwood, NJ
My Newsgroups & Boards at: http://members.aol.com/TaxService/index.html

Where Ignorance is bliss, 'tis folly to be wise!=

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I opened a small business about four months ago and I'm
looking for some basic info on what I can expense. Does
anyone know of a good website for this type of info? I run a
computer consulting business out of my house and my expenses
are pretty basic. While I know I can expense some of my
costs, I'm not sure if I can expense my costs in entirety.
For example, I use my car for business, but should I expense
the entire tank of gas? How do I calulate this, and at what
point does this become a major pain in the rear? Here are a
list of my expenses that I'm interested about:

Gas
Car payment
Car insurance
Cell phone
internet connection

Thanks for any advice!

Steve

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