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Amend Tax Return 2009

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Amend Tax Return 2009

Amend tax return 2009 5. Amend tax return 2009   How To Get Tax Help Table of Contents Low Income Taxpayer Clinics Whether it's help with a tax issue, preparing your tax return or a need for a free publication or form, get the help you need the way you want it: online, use a smart phone, call or walk in to an IRS office or volunteer site near you. Amend tax return 2009 Free help with your tax return. Amend tax return 2009   You can get free help preparing your return nationwide from IRS-certified volunteers. Amend tax return 2009 The Volunteer Income Tax Assistance (VITA) program helps low-to-moderate income, elderly, people with disabilities, and limited English proficient taxpayers. Amend tax return 2009 The Tax Counseling for the Elderly (TCE) program helps taxpayers age 60 and older with their tax returns. Amend tax return 2009 Most VITA and TCE sites offer free electronic filing and all volunteers will let you know about credits and deductions you may be entitled to claim. Amend tax return 2009 In addition, some VITA and TCE sites provide taxpayers the opportunity to prepare their own return with help from an IRS-certified volunteer. Amend tax return 2009 To find the nearest VITA or TCE site, you can use the VITA Locator Tool on IRS. Amend tax return 2009 gov, download the IRS2Go app, or call 1-800-906-9887. Amend tax return 2009   As part of the TCE program, AARP offers the Tax-Aide counseling program. Amend tax return 2009 To find the nearest AARP Tax-Aide site, visit AARP's website at www. Amend tax return 2009 aarp. Amend tax return 2009 org/money/taxaide or call 1-888-227-7669. Amend tax return 2009 For more information on these programs, go to IRS. Amend tax return 2009 gov and enter “VITA” in the search box. Amend tax return 2009 Internet. Amend tax return 2009    IRS. Amend tax return 2009 gov and IRS2Go are ready when you are —24 hours a day, 7 days a week. Amend tax return 2009 Download the free IRS2Go app from the iTunes app store or from Google Play. Amend tax return 2009 Use it to check your refund status, order transcripts of your tax returns or tax account, watch the IRS YouTube channel, get IRS news as soon as it's released to the public, subscribe to filing season updates or daily tax tips, and follow the IRS Twitter news feed, @IRSnews, to get the latest federal tax news, including information about tax law changes and important IRS programs. Amend tax return 2009 Check the status of your 2013 refund with the Where's My Refund? application on IRS. Amend tax return 2009 gov or download the IRS2Go app and select the Refund Status option. Amend tax return 2009 The IRS issues more than 9 out of 10 refunds in less than 21 days. Amend tax return 2009 Using these applications, you can start checking on the status of your return within 24 hours after we receive your e-filed return or 4 weeks after you mail a paper return. Amend tax return 2009 You will also be given a personalized refund date as soon as the IRS processes your tax return and approves your refund. Amend tax return 2009 The IRS updates Where's My Refund? every 24 hours, usually overnight, so you only need to check once a day. Amend tax return 2009 Use the Interactive Tax Assistant (ITA) to research your tax questions. Amend tax return 2009 No need to wait on the phone or stand in line. Amend tax return 2009 The ITA is available 24 hours a day, 7 days a week, and provides you with a variety of tax information related to general filing topics, deductions, credits, and income. Amend tax return 2009 When you reach the response screen, you can print the entire interview and the final response for your records. Amend tax return 2009 New subject areas are added on a regular basis. Amend tax return 2009  Answers not provided through ITA may be found in Tax Trails, one of the Tax Topics on IRS. Amend tax return 2009 gov which contain general individual and business tax information or by searching the IRS Tax Map, which includes an international subject index. Amend tax return 2009 You can use the IRS Tax Map, to search publications and instructions by topic or keyword. Amend tax return 2009 The IRS Tax Map integrates forms and publications into one research tool and provides single-point access to tax law information by subject. Amend tax return 2009 When the user searches the IRS Tax Map, they will be provided with links to related content in existing IRS publications, forms and instructions, questions and answers, and Tax Topics. Amend tax return 2009 Coming this filing season, you can immediately view and print for free all 5 types of individual federal tax transcripts (tax returns, tax account, record of account, wage and income statement, and certification of non-filing) using Get Transcript. Amend tax return 2009 You can also ask the IRS to mail a return or an account transcript to you. Amend tax return 2009 Only the mail option is available by choosing the Tax Records option on the IRS2Go app by selecting Mail Transcript on IRS. Amend tax return 2009 gov or by calling 1-800-908-9946. Amend tax return 2009 Tax return and tax account transcripts are generally available for the current year and the past three years. Amend tax return 2009 Determine if you are eligible for the EITC and estimate the amount of the credit with the Earned Income Tax Credit (EITC) Assistant. Amend tax return 2009 Visit Understanding Your IRS Notice or Letter to get answers to questions about a notice or letter you received from the IRS. Amend tax return 2009 If you received the First Time Homebuyer Credit, you can use the First Time Homebuyer Credit Account Look-up tool for information on your repayments and account balance. Amend tax return 2009 Check the status of your amended return using Where's My Amended Return? Go to IRS. Amend tax return 2009 gov and enter Where's My Amended Return? in the search box. Amend tax return 2009 You can generally expect your amended return to be processed up to 12 weeks from the date we receive it. Amend tax return 2009 It can take up to 3 weeks from the date you mailed it to show up in our system. Amend tax return 2009 Make a payment using one of several safe and convenient electronic payment options available on IRS. Amend tax return 2009 gov. Amend tax return 2009 Select the Payment tab on the front page of IRS. Amend tax return 2009 gov for more information. Amend tax return 2009 Determine if you are eligible and apply for an online payment agreement, if you owe more tax than you can pay today. Amend tax return 2009 Figure your income tax withholding with the IRS Withholding Calculator on IRS. Amend tax return 2009 gov. Amend tax return 2009 Use it if you've had too much or too little withheld, your personal situation has changed, you're starting a new job or you just want to see if you're having the right amount withheld. Amend tax return 2009 Determine if you might be subject to the Alternative Minimum Tax by using the Alternative Minimum Tax Assistant on IRS. Amend tax return 2009 gov. Amend tax return 2009 Request an Electronic Filing PIN by going to IRS. Amend tax return 2009 gov and entering Electronic Filing PIN in the search box. Amend tax return 2009 Download forms, instructions and publications, including accessible versions for people with disabilities. Amend tax return 2009 Locate the nearest Taxpayer Assistance Center (TAC) using the Office Locator tool on IRS. Amend tax return 2009 gov, or choose the Contact Us option on the IRS2Go app and search Local Offices. Amend tax return 2009 An employee can answer questions about your tax account or help you set up a payment plan. Amend tax return 2009 Before you visit, check the Office Locator on IRS. Amend tax return 2009 gov, or Local Offices under Contact Us on IRS2Go to confirm the address, phone number, days and hours of operation, and the services provided. Amend tax return 2009 If you have a special need, such as a disability, you can request an appointment. Amend tax return 2009 Call the local number listed in the Office Locator, or look in the phone book under United States Government, Internal Revenue Service. Amend tax return 2009 Apply for an Employer Identification Number (EIN). Amend tax return 2009 Go to IRS. Amend tax return 2009 gov and enter Apply for an EIN in the search box. Amend tax return 2009 Read the Internal Revenue Code, regulations, or other official guidance. Amend tax return 2009 Read Internal Revenue Bulletins. Amend tax return 2009 Sign up to receive local and national tax news and more by email. Amend tax return 2009 Just click on “subscriptions” above the search box on IRS. Amend tax return 2009 gov and choose from a variety of options. Amend tax return 2009 Phone. Amend tax return 2009    You can call the IRS, or you can carry it in your pocket with the IRS2Go app on your smart phone or tablet. Amend tax return 2009 Download the free IRS2Go app from the iTunes app store or from Google Play. Amend tax return 2009 Call to locate the nearest volunteer help site, 1-800-906-9887 or you can use the VITA Locator Tool on IRS. Amend tax return 2009 gov, or download the IRS2Go app. Amend tax return 2009 Low-to-moderate income, elderly, people with disabilities, and limited English proficient taxpayers can get free help with their tax return from the nationwide Volunteer Income Tax Assistance (VITA) program. Amend tax return 2009 The Tax Counseling for the Elderly (TCE) program helps taxpayers age 60 and older with their tax returns. Amend tax return 2009 Most VITA and TCE sites offer free electronic filing. Amend tax return 2009 Some VITA and TCE sites provide IRS-certified volunteers who can help prepare your tax return. Amend tax return 2009 Through the TCE program, AARP offers the Tax-Aide counseling program; call 1-888-227-7669 to find the nearest Tax-Aide location. Amend tax return 2009 Call the automated Where's My Refund? information hotline to check the status of your 2013 refund 24 hours a day, 7 days a week at 1-800-829-1954. Amend tax return 2009 If you e-file, you can start checking on the status of your return within 24 hours after the IRS receives your tax return or 4 weeks after you've mailed a paper return. Amend tax return 2009 The IRS issues more than 9 out of 10 refunds in less than 21 days. Amend tax return 2009 Where's My Refund? will give you a personalized refund date as soon as the IRS processes your tax return and approves your refund. Amend tax return 2009 Before you call this automated hotline, have your 2013 tax return handy so you can enter your social security number, your filing status, and the exact whole dollar amount of your refund. Amend tax return 2009 The IRS updates Where's My Refund? every 24 hours, usually overnight, so you only need to check once a day. Amend tax return 2009 Note, the above information is for our automated hotline. Amend tax return 2009 Our live phone and walk-in assistors can research the status of your refund only if it's been 21 days or more since you filed electronically or more than 6 weeks since you mailed your paper return. Amend tax return 2009 Call the Amended Return Hotline, 1-866-464-2050, to check the status of your amended return. Amend tax return 2009 You can generally expect your amended return to be processed up to 12 weeks from the date we receive it. Amend tax return 2009 It can take up to 3 weeks from the date you mailed it to show up in our system. Amend tax return 2009 Call 1-800-TAX-FORM (1-800-829-3676) to order current-year forms, instructions, publications, and prior-year forms and instructions (limited to 5 years). Amend tax return 2009 You should receive your order within 10 business days. Amend tax return 2009 Call TeleTax, 1-800-829-4477, to listen to pre-recorded messages covering general and business tax information. Amend tax return 2009 If, between January and April 15, you still have questions about the Form 1040, 1040A, or 1040EZ (like filing requirements, dependents, credits, Schedule D, pensions and IRAs or self-employment taxes), call 1-800-829-1040. Amend tax return 2009 Call using TTY/TDD equipment, 1-800-829-4059 to ask tax questions or order forms and publications. Amend tax return 2009 The TTY/TDD telephone number is for people who are deaf, hard of hearing, or have a speech disability. Amend tax return 2009 These individuals can also contact the IRS through relay services such as the Federal Relay Service. Amend tax return 2009 Walk-in. Amend tax return 2009   You can find a selection of forms, publications and services — in-person. Amend tax return 2009 Products. Amend tax return 2009 You can walk in to some post offices, libraries, and IRS offices to pick up certain forms, instructions, and publications. Amend tax return 2009 Some IRS offices, libraries, and city and county government offices have a collection of products available to photocopy from reproducible proofs. Amend tax return 2009 Services. Amend tax return 2009 You can walk in to your local TAC for face-to-face tax help. Amend tax return 2009 An employee can answer questions about your tax account or help you set up a payment plan. Amend tax return 2009 Before visiting, use the Office Locator tool on IRS. Amend tax return 2009 gov, or choose the Contact Us option on the IRS2Go app and search Local Offices for days and hours of operation, and services provided. Amend tax return 2009 Mail. Amend tax return 2009   You can send your order for forms, instructions, and publications to the address below. Amend tax return 2009 You should receive a response within 10 business days after your request is received. Amend tax return 2009 Internal Revenue Service 1201 N. Amend tax return 2009 Mitsubishi Motorway Bloomington, IL 61705-6613    The Taxpayer Advocate Service Is Here to Help You. Amend tax return 2009 The Taxpayer Advocate Service (TAS) is your voice at the IRS. Amend tax return 2009 Our job is to ensure that every taxpayer is treated fairly and that you know and understand your rights. Amend tax return 2009   What can TAS do for you? We can offer you free help with IRS problems that you can't resolve on your own. Amend tax return 2009 We know this process can be confusing, but the worst thing you can do is nothing at all! TAS can help if you can't resolve your tax problem and: Your problem is causing financial difficulties for you, your family, or your business. Amend tax return 2009 You face (or your business is facing) an immediate threat of adverse action. Amend tax return 2009 You've tried repeatedly to contact the IRS but no one has responded, or the IRS hasn't responded by the date promised. Amend tax return 2009   If you qualify for our help, you'll be assigned to one advocate who'll be with you at every turn and will do everything possible to resolve your problem. Amend tax return 2009 Here's why we can help: TAS is an independent organization within the IRS. Amend tax return 2009 Our advocates know how to work with the IRS. Amend tax return 2009 Our services are free and tailored to meet your needs. Amend tax return 2009 We have offices in every state, the District of Columbia, and Puerto Rico. Amend tax return 2009   How can you reach us? If you think TAS can help you, call your local advocate, whose number is in your local directory and at Taxpayer Advocate, or call us toll-free at 1-877-777-4778. Amend tax return 2009   How else does TAS help taxpayers?  TAS also works to resolve large-scale, systemic problems that affect many taxpayers. Amend tax return 2009 If you know of one of these broad issues, please report it to us through our Systemic Advocacy Management System. Amend tax return 2009 Low Income Taxpayer Clinics Low Income Taxpayer Clinics (LITCs) serve individuals whose income is below a certain level and need to resolve tax problems such as audits, appeals and tax collection disputes. Amend tax return 2009 Some clinics can provide information about taxpayer rights and responsibilities in different languages for individuals who speak English as a second language. Amend tax return 2009 Visit Taxpayer Advocate or see IRS Publication 4134, Low Income Taxpayer Clinic List. Amend tax return 2009 Prev  Up  Next   Home   More Online Publications
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The Amend Tax Return 2009

Amend tax return 2009 8. Amend tax return 2009   Business Expenses Table of Contents Introduction Useful Items - You may want to see: Bad DebtsAccrual method. Amend tax return 2009 Cash method. Amend tax return 2009 Car and Truck ExpensesOffice in the home. Amend tax return 2009 Methods for Deducting Car and Truck Expenses Reimbursing Your Employees for Expenses Depreciation Employees' PayFringe benefits. Amend tax return 2009 InsuranceHow to figure the deduction. Amend tax return 2009 Interest Legal and Professional FeesTax preparation fees. Amend tax return 2009 Pension Plans Rent Expense Taxes Travel, Meals, and EntertainmentTransportation. Amend tax return 2009 Taxi, commuter bus, and limousine. Amend tax return 2009 Baggage and shipping. Amend tax return 2009 Car or truck. Amend tax return 2009 Meals and lodging. Amend tax return 2009 Cleaning. Amend tax return 2009 Telephone. Amend tax return 2009 Tips. Amend tax return 2009 More information. Amend tax return 2009 Business Use of Your HomeExceptions to exclusive use. Amend tax return 2009 Other Expenses You Can Deduct Expenses You Cannot Deduct Introduction You can deduct the costs of operating your business. Amend tax return 2009 These costs are known as business expenses. Amend tax return 2009 These are costs you do not have to capitalize or include in the cost of goods sold but can deduct in the current year. Amend tax return 2009 To be deductible, a business expense must be both ordinary and necessary. Amend tax return 2009 An ordinary expense is one that is common and accepted in your field of business. Amend tax return 2009 A necessary expense is one that is helpful and appropriate for your business. Amend tax return 2009 An expense does not have to be indispensable to be considered necessary. Amend tax return 2009 For more information about the general rules for deducting business expenses, see chapter 1 in Publication 535, Business Expenses. Amend tax return 2009 If you have an expense that is partly for business and partly personal, separate the personal part from the business part. Amend tax return 2009 The personal part is not deductible. Amend tax return 2009 Useful Items - You may want to see: Publication 463 Travel, Entertainment, Gift, and Car Expenses 535 Business Expenses 946 How To Depreciate Property See chapter 12 for information about getting publications and forms. Amend tax return 2009 Bad Debts If someone owes you money you cannot collect, you have a bad debt. Amend tax return 2009 There are two kinds of bad debts, business bad debts and nonbusiness bad debts. Amend tax return 2009 A business bad debt is generally one that comes from operating your trade or business. Amend tax return 2009 You may be able to deduct business bad debts as an expense on your business tax return. Amend tax return 2009 Business bad debt. Amend tax return 2009   A business bad debt is a loss from the worthlessness of a debt that was either of the following. Amend tax return 2009 Created or acquired in your business. Amend tax return 2009 Closely related to your business when it became partly or totally worthless. Amend tax return 2009 A debt is closely related to your business if your primary motive for incurring the debt is a business reason. Amend tax return 2009   Business bad debts are mainly the result of credit sales to customers. Amend tax return 2009 They can also be the result of loans to suppliers, clients, employees, or distributors. Amend tax return 2009 Goods and services customers have not paid for are shown in your books as either accounts receivable or notes receivable. Amend tax return 2009 If you are unable to collect any part of these accounts or notes receivable, the uncollectible part is a business bad debt. Amend tax return 2009    You can take a bad debt deduction for these accounts and notes receivable only if the amount you were owed was included in your gross income either for the year the deduction is claimed or for a prior year. Amend tax return 2009 Accrual method. Amend tax return 2009   If you use an accrual method of accounting, you normally report income as you earn it. Amend tax return 2009 You can take a bad debt deduction for an uncollectible receivable if you have included the uncollectible amount in income. Amend tax return 2009 Cash method. Amend tax return 2009   If you use the cash method of accounting, you normally report income when you receive payment. Amend tax return 2009 You cannot take a bad debt deduction for amounts owed to you that you have not received and cannot collect if you never included those amounts in income. Amend tax return 2009 More information. Amend tax return 2009   For more information about business bad debts, see chapter 10 in Publication 535. Amend tax return 2009 Nonbusiness bad debts. Amend tax return 2009   All other bad debts are nonbusiness bad debts and are deductible as short-term capital losses on Form 8949 and Schedule D (Form 1040). Amend tax return 2009 For more information on nonbusiness bad debts, see Publication 550, Investment Income and Expenses. Amend tax return 2009 Car and Truck Expenses If you use your car or truck in your business, you may be able to deduct the costs of operating and maintaining your vehicle. Amend tax return 2009 You also may be able to deduct other costs of local transportation and traveling away from home overnight on business. Amend tax return 2009 You may qualify for a tax credit for qualified plug-in electric vehicles, qualified plug-in electric drive motor vehicles, and alternative motor vehicles you place in service during the year. Amend tax return 2009 See Form 8936 and Form 8910 for more information. Amend tax return 2009 Local transportation expenses. Amend tax return 2009   Local transportation expenses include the ordinary and necessary costs of all the following. Amend tax return 2009 Getting from one workplace to another in the course of your business or profession when you are traveling within the city or general area that is your tax home. Amend tax return 2009 Tax home is defined later. Amend tax return 2009 Visiting clients or customers. Amend tax return 2009 Going to a business meeting away from your regular workplace. Amend tax return 2009 Getting from your home to a temporary workplace when you have one or more regular places of work. Amend tax return 2009 These temporary workplaces can be either within the area of your tax home or outside that area. Amend tax return 2009 Local business transportation does not include expenses you have while traveling away from home overnight. Amend tax return 2009 Those expenses are deductible as travel expenses and are discussed later under Travel, Meals, and Entertainment. Amend tax return 2009 However, if you use your car while traveling away from home overnight, use the rules in this section to figure your car expense deduction. Amend tax return 2009   Generally, your tax home is your regular place of business, regardless of where you maintain your family home. Amend tax return 2009 It includes the entire city or general area in which your business or work is located. Amend tax return 2009 Example. Amend tax return 2009 You operate a printing business out of rented office space. Amend tax return 2009 You use your van to deliver completed jobs to your customers. Amend tax return 2009 You can deduct the cost of round-trip transportation between your customers and your print shop. Amend tax return 2009    You cannot deduct the costs of driving your car or truck between your home and your main or regular workplace. Amend tax return 2009 These costs are personal commuting expenses. Amend tax return 2009 Office in the home. Amend tax return 2009   Your workplace can be your home if you have an office in your home that qualifies as your principal place of business. Amend tax return 2009 For more information, see Business Use of Your Home, later. Amend tax return 2009 Example. Amend tax return 2009 You are a graphics designer. Amend tax return 2009 You operate your business out of your home. Amend tax return 2009 Your home qualifies as your principal place of business. Amend tax return 2009 You occasionally have to drive to your clients to deliver your completed work. Amend tax return 2009 You can deduct the cost of the round-trip transportation between your home and your clients. Amend tax return 2009 Methods for Deducting Car and Truck Expenses For local transportation or overnight travel by car or truck, you generally can use one of the following methods to figure your expenses. Amend tax return 2009 Standard mileage rate. Amend tax return 2009 Actual expenses. Amend tax return 2009 Standard mileage rate. Amend tax return 2009   You may be able to use the standard mileage rate to figure the deductible costs of operating your car, van, pickup, or panel truck for business purposes. Amend tax return 2009 For 2013, the standard mileage rate is 56. Amend tax return 2009 5 cents per mile. Amend tax return 2009    If you choose to use the standard mileage rate for a year, you cannot deduct your actual expenses for that year except for business-related parking fees and tolls. Amend tax return 2009 Choosing the standard mileage rate. Amend tax return 2009   If you want to use the standard mileage rate for a car or truck you own, you must choose to use it in the first year the car is available for use in your business. Amend tax return 2009 In later years, you can choose to use either the standard mileage rate or actual expenses. Amend tax return 2009   If you use the standard mileage rate for a car you lease, you must choose to use it for the entire lease period (including renewals). Amend tax return 2009 Standard mileage rate not allowed. Amend tax return 2009   You cannot use the standard mileage rate if you: Operate five or more cars at the same time, Claimed a depreciation deduction using any method other than straight line, for example, ACRS or MACRS, Claimed a section 179 deduction on the car, Claimed the special depreciation allowance on the car, Claimed actual car expenses for a car you leased, or Are a rural mail carrier who received a qualified reimbursement. Amend tax return 2009 Parking fees and tolls. Amend tax return 2009   In addition to using the standard mileage rate, you can deduct any business-related parking fees and tolls. Amend tax return 2009 (Parking fees you pay to park your car at your place of work are nondeductible commuting expenses. Amend tax return 2009 ) Actual expenses. Amend tax return 2009   If you do not choose to use the standard mileage rate, you may be able to deduct your actual car or truck expenses. Amend tax return 2009    If you qualify to use both methods, figure your deduction both ways to see which gives you a larger deduction. Amend tax return 2009   Actual car expenses include the costs of the following items. Amend tax return 2009 Depreciation Lease payments Registration Garage rent Licenses Repairs Gas Oil Tires Insurance Parking fees Tolls   If you use your vehicle for both business and personal purposes, you must divide your expenses between business and personal use. Amend tax return 2009 You can divide your expenses based on the miles driven for each purpose. Amend tax return 2009 Example. Amend tax return 2009 You are the sole proprietor of a flower shop. Amend tax return 2009 You drove your van 20,000 miles during the year. Amend tax return 2009 16,000 miles were for delivering flowers to customers and 4,000 miles were for personal use (including commuting miles). Amend tax return 2009 You can claim only 80% (16,000 ÷ 20,000) of the cost of operating your van as a business expense. Amend tax return 2009 More information. Amend tax return 2009   For more information about the rules for claiming car and truck expenses, see Publication 463. Amend tax return 2009 Reimbursing Your Employees for Expenses You generally can deduct the amount you reimburse your employees for car and truck expenses. Amend tax return 2009 The reimbursement you deduct and the manner in which you deduct it depend in part on whether you reimburse the expenses under an accountable plan or a nonaccountable plan. Amend tax return 2009 For details, see chapter 11 in Publication 535. Amend tax return 2009 That chapter explains accountable and nonaccountable plans and tells you whether to report the reimbursement on your employee's Form W-2, Wage and Tax Statement. Amend tax return 2009 Depreciation If property you acquire to use in your business is expected to last more than 1 year, you generally cannot deduct the entire cost as a business expense in the year you acquire it. Amend tax return 2009 You must spread the cost over more than 1 tax year and deduct part of it each year on Schedule C. Amend tax return 2009 This method of deducting the cost of business property is called depreciation. Amend tax return 2009 The discussion here is brief. Amend tax return 2009 You will find more information about depreciation in Publication 946. Amend tax return 2009 What property can be depreciated?   You can depreciate property if it meets all the following requirements. Amend tax return 2009 It must be property you own. Amend tax return 2009 It must be used in business or held to produce income. Amend tax return 2009 You never can depreciate inventory (explained in chapter 2) because it is not held for use in your business. Amend tax return 2009 It must have a useful life that extends substantially beyond the year it is placed in service. Amend tax return 2009 It must have a determinable useful life, which means that it must be something that wears out, decays, gets used up, becomes obsolete, or loses its value from natural causes. Amend tax return 2009 You never can depreciate the cost of land because land does not wear out, become obsolete, or get used up. Amend tax return 2009 It must not be excepted property. Amend tax return 2009 This includes property placed in service and disposed of in the same year. Amend tax return 2009 Repairs. Amend tax return 2009    You cannot depreciate repairs and replacements that do not increase the value of your property, make it more useful, or lengthen its useful life. Amend tax return 2009 You can deduct these amounts on line 21 of Schedule C or line 2 of Schedule C-EZ. Amend tax return 2009 Depreciation method. Amend tax return 2009   The method for depreciating most business and investment property placed in service after 1986 is called the Modified Accelerated Cost Recovery System (MACRS). Amend tax return 2009 MACRS is discussed in detail in Publication 946. Amend tax return 2009 Section 179 deduction. Amend tax return 2009   You can elect to deduct a limited amount of the cost of certain depreciable property in the year you place the property in service. Amend tax return 2009 This deduction is known as the “section 179 deduction. Amend tax return 2009 ” The maximum amount you can elect to deduct during 2013 is generally $500,000 (higher limits apply to certain property). Amend tax return 2009 See IRC 179(e). Amend tax return 2009   This limit is generally reduced by the amount by which the cost of the property placed in service during the tax year exceeds $2 million. Amend tax return 2009 The total amount of depreciation (including the section 179 deduction) you can take for a passenger automobile you use in your business and first place in service in 2013 is $3,160 ($11,160 if you take the special depreciation allowance for qualified passenger automobiles placed in service in 2013). Amend tax return 2009 Special rules apply to trucks and vans. Amend tax return 2009 For more information, see Publication 946. Amend tax return 2009 It explains what property qualifies for the deduction, what limits apply to the deduction, and when and how to recapture the deduction. Amend tax return 2009    Your section 179 election for the cost of any sport utility vehicle (SUV) and certain other vehicles is limited to $25,000. Amend tax return 2009 For more information, see the Instructions for Form 4562 or Publication 946. Amend tax return 2009 Listed property. Amend tax return 2009   You must follow special rules and recordkeeping requirements when depreciating listed property. Amend tax return 2009 Listed property is any of the following. Amend tax return 2009 Most passenger automobiles. Amend tax return 2009 Most other property used for transportation. Amend tax return 2009 Any property of a type generally used for entertainment, recreation, or amusement. Amend tax return 2009 Certain computers and related peripheral equipment. Amend tax return 2009   For more information about listed property, see Publication 946. Amend tax return 2009 Form 4562. Amend tax return 2009   Use Form 4562, Depreciation and Amortization, if you are claiming any of the following. Amend tax return 2009 Depreciation on property placed in service during the current tax year. Amend tax return 2009 A section 179 deduction. Amend tax return 2009 Depreciation on any listed property (regardless of when it was placed in service). Amend tax return 2009    If you have to use Form 4562, you must file Schedule C. Amend tax return 2009 You cannot use Schedule C-EZ. Amend tax return 2009   Employees' Pay You can generally deduct on Schedule C the pay you give your employees for the services they perform for your business. Amend tax return 2009 The pay may be in cash, property, or services. Amend tax return 2009 To be deductible, your employees' pay must be an ordinary and necessary expense and you must pay or incur it in the tax year. Amend tax return 2009 In addition, the pay must meet both the following tests. Amend tax return 2009 The pay must be reasonable. Amend tax return 2009 The pay must be for services performed. Amend tax return 2009 Chapter 2 in Publication 535 explains and defines these requirements. Amend tax return 2009 You cannot deduct your own salary or any personal withdrawals you make from your business. Amend tax return 2009 As a sole proprietor, you are not an employee of the business. Amend tax return 2009 If you had employees during the year, you must use Schedule C. Amend tax return 2009 You cannot use Schedule C-EZ. Amend tax return 2009 Kinds of pay. Amend tax return 2009   Some of the ways you may provide pay to your employees are listed below. Amend tax return 2009 For an explanation of each of these items, see chapter 2 in Publication 535. Amend tax return 2009 Awards. Amend tax return 2009 Bonuses. Amend tax return 2009 Education expenses. Amend tax return 2009 Fringe benefits (discussed later). Amend tax return 2009 Loans or advances you do not expect the employee to repay if they are for personal services actually performed. Amend tax return 2009 Property you transfer to an employee as payment for services. Amend tax return 2009 Reimbursements for employee business expenses. Amend tax return 2009 Sick pay. Amend tax return 2009 Vacation pay. Amend tax return 2009 Fringe benefits. Amend tax return 2009   A fringe benefit is a form of pay for the performance of services. Amend tax return 2009 The following are examples of fringe benefits. Amend tax return 2009 Benefits under qualified employee benefit programs. Amend tax return 2009 Meals and lodging. Amend tax return 2009 The use of a car. Amend tax return 2009 Flights on airplanes. Amend tax return 2009 Discounts on property or services. Amend tax return 2009 Memberships in country clubs or other social clubs. Amend tax return 2009 Tickets to entertainment or sporting events. Amend tax return 2009   Employee benefit programs include the following. Amend tax return 2009 Accident and health plans. Amend tax return 2009 Adoption assistance. Amend tax return 2009 Cafeteria plans. Amend tax return 2009 Dependent care assistance. Amend tax return 2009 Educational assistance. Amend tax return 2009 Group-term life insurance coverage. Amend tax return 2009 Welfare benefit funds. Amend tax return 2009   You can generally deduct the cost of fringe benefits you provide on your Schedule C in whatever category the cost falls. Amend tax return 2009 For example, if you allow an employee to use a car or other property you lease, deduct the cost of the lease as a rent or lease expense. Amend tax return 2009 If you own the property, include your deduction for its cost or other basis as a section 179 deduction or a depreciation deduction. Amend tax return 2009    You may be able to exclude all or part of the fringe benefits you provide from your employees' wages. Amend tax return 2009 For more information about fringe benefits and the exclusion of benefits, see Publication 15-B, Employer's Tax Guide to Fringe Benefits. Amend tax return 2009 Insurance You can generally deduct premiums you pay for the following kinds of insurance related to your business. Amend tax return 2009 Fire, theft, flood, or similar insurance. Amend tax return 2009 Credit insurance that covers losses from business bad debts. Amend tax return 2009 Group hospitalization and medical insurance for employees, including long-term care insurance. Amend tax return 2009 Liability insurance. Amend tax return 2009 Malpractice insurance that covers your personal liability for professional negligence resulting in injury or damage to patients or clients. Amend tax return 2009 Workers' compensation insurance set by state law that covers any claims for bodily injuries or job-related diseases suffered by employees in your business, regardless of fault. Amend tax return 2009 Contributions to a state unemployment insurance fund are deductible as taxes if they are considered taxes under state law. Amend tax return 2009 Overhead insurance that pays for business overhead expenses you have during long periods of disability caused by your injury or sickness. Amend tax return 2009 Car and other vehicle insurance that covers vehicles used in your business for liability, damages, and other losses. Amend tax return 2009 If you operate a vehicle partly for personal use, deduct only the part of the insurance premium that applies to the business use of the vehicle. Amend tax return 2009 If you use the standard mileage rate to figure your car expenses, you cannot deduct any car insurance premiums. Amend tax return 2009 Life insurance covering your employees if you are not directly or indirectly the beneficiary under the contract. Amend tax return 2009 Business interruption insurance that pays for lost profits if your business is shut down due to a fire or other cause. Amend tax return 2009 Nondeductible premiums. Amend tax return 2009   You cannot deduct premiums on the following kinds of insurance. Amend tax return 2009 Self-insurance reserve funds. Amend tax return 2009 You cannot deduct amounts credited to a reserve set up for self-insurance. Amend tax return 2009 This applies even if you cannot get business insurance coverage for certain business risks. Amend tax return 2009 However, your actual losses may be deductible. Amend tax return 2009 For more information, see Publication 547, Casualties, Disasters, and Thefts. Amend tax return 2009 Loss of earnings. Amend tax return 2009 You cannot deduct premiums for a policy that pays for your lost earnings due to sickness or disability. Amend tax return 2009 However, see item (8) in the previous list. Amend tax return 2009 Certain life insurance and annuities. Amend tax return 2009 For contracts issued before June 9, 1997, you cannot deduct the premiums on a life insurance policy covering you, an employee, or any person with a financial interest in your business if you are directly or indirectly a beneficiary of the policy. Amend tax return 2009 You are included among possible beneficiaries of the policy if the policy owner is obligated to repay a loan from you using the proceeds of the policy. Amend tax return 2009 A person has a financial interest in your business if the person is an owner or part owner of the business or has lent money to the business. Amend tax return 2009 For contracts issued after June 8, 1997, you generally cannot deduct the premiums on any life insurance policy, endowment contract, or annuity contract if you are directly or indirectly a beneficiary. Amend tax return 2009 The disallowance applies without regard to whom the policy covers. Amend tax return 2009 Insurance to secure a loan. Amend tax return 2009 If you take out a policy on your life or on the life of another person with a financial interest in your business to get or protect a business loan, you cannot deduct the premiums as a business expense. Amend tax return 2009 Nor can you deduct the premiums as interest on business loans or as an expense of financing loans. Amend tax return 2009 In the event of death, the proceeds of the policy are not taxed as income even if they are used to liquidate the debt. Amend tax return 2009 Self-employed health insurance deduction. Amend tax return 2009   You may be able to deduct the amount you paid for medical and dental insurance and qualified long-term care insurance for you and your family. Amend tax return 2009 How to figure the deduction. Amend tax return 2009   Generally, you can use the worksheet in the Form 1040 instructions to figure your deduction. Amend tax return 2009 However, if any of the following apply, you must use the worksheet in chapter 6 of Publication 535. Amend tax return 2009 You have more than one source of income subject to self-employment tax. Amend tax return 2009 You file Form 2555 or Form 2555-EZ (relating to foreign earned income). Amend tax return 2009 You are using amounts paid for qualified long-term care insurance to figure the deduction. Amend tax return 2009 Prepayment. Amend tax return 2009   You cannot deduct expenses in advance, even if you pay them in advance. Amend tax return 2009 This rule applies to any expense paid far enough in advance to, in effect, create an asset with a useful life extending substantially beyond the end of the current tax year. Amend tax return 2009 Example. Amend tax return 2009 In 2013, you signed a 3-year insurance contract. Amend tax return 2009 Even though you paid the premiums for 2013, 2014, and 2015 when you signed the contract, you can only deduct the premium for 2013 on your 2013 tax return. Amend tax return 2009 You can deduct in 2014 and 2015 the premium allocable to those years. Amend tax return 2009 More information. Amend tax return 2009   For more information about deducting insurance, see chapter 6 in Publication 535. Amend tax return 2009 Interest You can generally deduct as a business expense all interest you pay or accrue during the tax year on debts related to your business. Amend tax return 2009 Interest relates to your business if you use the proceeds of the loan for a business expense. Amend tax return 2009 It does not matter what type of property secures the loan. Amend tax return 2009 You can deduct interest on a debt only if you meet all of the following requirements. Amend tax return 2009 You are legally liable for that debt. Amend tax return 2009 Both you and the lender intend that the debt be repaid. Amend tax return 2009 You and the lender have a true debtor-creditor relationship. Amend tax return 2009 You cannot deduct on Schedule C or C-EZ the interest you paid on personal loans. Amend tax return 2009 If a loan is part business and part personal, you must divide the interest between the personal part and the business part. Amend tax return 2009 Example. Amend tax return 2009 In 2013, you paid $600 interest on a car loan. Amend tax return 2009 During 2013, you used the car 60% for business and 40% for personal purposes. Amend tax return 2009 You are claiming actual expenses on the car. Amend tax return 2009 You can only deduct $360 (60% × $600) for 2013 on Schedule C or C-EZ. Amend tax return 2009 The remaining interest of $240 is a nondeductible personal expense. Amend tax return 2009 More information. Amend tax return 2009   For more information about deducting interest, see chapter 4 in Publication 535. Amend tax return 2009 That chapter explains the following items. Amend tax return 2009 Interest you can deduct. Amend tax return 2009 Interest you cannot deduct. Amend tax return 2009 How to allocate interest between personal and business use. Amend tax return 2009 When to deduct interest. Amend tax return 2009 The rules for a below-market interest rate loan. Amend tax return 2009 (This is generally a loan on which no interest is charged or on which interest is charged at a rate below the applicable federal rate. Amend tax return 2009 ) Legal and Professional Fees Legal and professional fees, such as fees charged by accountants, that are ordinary and necessary expenses directly related to operating your business are deductible on Schedule C or C-EZ. Amend tax return 2009 However, you usually cannot deduct legal fees you pay to acquire business assets. Amend tax return 2009 Add them to the basis of the property. Amend tax return 2009 If the fees include payments for work of a personal nature (such as making a will), you can take a business deduction only for the part of the fee related to your business. Amend tax return 2009 The personal part of legal fees for producing or collecting taxable income, doing or keeping your job, or for tax advice may be deductible on Schedule A (Form 1040) if you itemize deductions. Amend tax return 2009 For more information, see Publication 529, Miscellaneous Deductions. Amend tax return 2009 Tax preparation fees. Amend tax return 2009   You can deduct on Schedule C or C-EZ the cost of preparing that part of your tax return relating to your business as a sole proprietor or statutory employee. Amend tax return 2009 You can deduct the remaining cost on Schedule A (Form 1040) if you itemize your deductions. Amend tax return 2009   You can also deduct on Schedule C or C-EZ the amount you pay or incur in resolving asserted tax deficiencies for your business as a sole proprietor or statutory employee. Amend tax return 2009 Pension Plans You can set up and maintain the following small business retirement plans for yourself and your employees. Amend tax return 2009 SEP (Simplified Employee Pension) plans. Amend tax return 2009 SIMPLE (Savings Incentive Match Plan for Employees) plans. Amend tax return 2009 Qualified plans (including Keogh or H. Amend tax return 2009 R. Amend tax return 2009 10 plans). Amend tax return 2009 SEP, SIMPLE, and qualified plans offer you and your employees a tax favored way to save for retirement. Amend tax return 2009 You can deduct contributions you make to the plan for your employees on line 19 of Schedule C. Amend tax return 2009 If you are a sole proprietor, you can deduct contributions you make to the plan for yourself on line 28 of Form 1040. Amend tax return 2009 You can also deduct trustees' fees if contributions to the plan do not cover them. Amend tax return 2009 Earnings on the contributions are generally tax free until you or your employees receive distributions from the plan. Amend tax return 2009 You may also be able to claim a tax credit of 50% of the first $1,000 of qualified startup costs if you begin a new qualified defined benefit or defined contribution plan (including a 401(k) plan), SIMPLE plan, or simplified employee pension. Amend tax return 2009 Under certain plans, employees can have you contribute limited amounts of their before-tax pay to a plan. Amend tax return 2009 These amounts (and earnings on them) are generally tax free until your employees receive distributions from the plan. Amend tax return 2009 For more information on retirement plans for small business, see Publication 560, Retirement Plans for Small Business (SEP, SIMPLE, and Qualified Plans). Amend tax return 2009 Publication 590, Individual Retirement Arrangements (IRAs), discusses other tax favored ways to save for retirement. Amend tax return 2009 Rent Expense Rent is any amount you pay for the use of property you do not own. Amend tax return 2009 In general, you can deduct rent as a business expense only if the rent is for property you use in your business. Amend tax return 2009 If you have or will receive equity in or title to the property, you cannot deduct the rent. Amend tax return 2009 Unreasonable rent. Amend tax return 2009   You cannot take a rental deduction for unreasonable rents. Amend tax return 2009 Ordinarily, the issue of reasonableness arises only if you and the lessor are related. Amend tax return 2009 Rent paid to a related person is reasonable if it is the same amount you would pay to a stranger for use of the same property. Amend tax return 2009 Rent is not unreasonable just because it is figured as a percentage of gross receipts. Amend tax return 2009   Related persons include members of your immediate family, including only brothers and sisters (either whole or half), your spouse, ancestors, and lineal descendants. Amend tax return 2009 For a list of the other related persons, see section 267 of the Internal Revenue Code. Amend tax return 2009 Rent on your home. Amend tax return 2009   If you rent your home and use part of it as your place of business, you may be able to deduct the rent you pay for that part. Amend tax return 2009 You must meet the requirements for business use of your home. Amend tax return 2009 For more information, see Business Use of Your Home , later. Amend tax return 2009 Rent paid in advance. Amend tax return 2009   Generally, rent paid in your business is deductible in the year paid or accrued. Amend tax return 2009 If you pay rent in advance, you can deduct only the amount that applies to your use of the rented property during the tax year. Amend tax return 2009 You can deduct the rest of your payment only over the period to which it applies. Amend tax return 2009 More information. Amend tax return 2009   For more information about rent, see chapter 3 in Publication 535. Amend tax return 2009 Taxes You can deduct on Schedule C or C-EZ various federal, state, local, and foreign taxes directly attributable to your business. Amend tax return 2009 Income taxes. Amend tax return 2009   You can deduct on Schedule C or C-EZ a state tax on gross income (as distinguished from net income) directly attributable to your business. Amend tax return 2009 You can deduct other state and local income taxes on Schedule A (Form 1040) if you itemize your deductions. Amend tax return 2009 Do not deduct federal income tax. Amend tax return 2009 Employment taxes. Amend tax return 2009   You can deduct the social security, Medicare, and federal unemployment (FUTA) taxes you paid out of your own funds as an employer. Amend tax return 2009 Employment taxes are discussed briefly in chapter 1. Amend tax return 2009 You can also deduct payments you made as an employer to a state unemployment compensation fund or to a state disability benefit fund. Amend tax return 2009 Deduct these payments as taxes. Amend tax return 2009 Self-employment tax. Amend tax return 2009   You can deduct one-half of your self-employment tax on line 27 of Form 1040. Amend tax return 2009 Self-employment tax is discussed in chapters 1 and 10. Amend tax return 2009 Personal property tax. Amend tax return 2009   You can deduct on Schedule C or C-EZ any tax imposed by a state or local government on personal property used in your business. Amend tax return 2009   You can also deduct registration fees for the right to use property within a state or local area. Amend tax return 2009 Example. Amend tax return 2009 May and Julius Winter drove their car 7,000 business miles out of a total of 10,000 miles. Amend tax return 2009 They had to pay $25 for their annual state license tags and $20 for their city registration sticker. Amend tax return 2009 They also paid $235 in city personal property tax on the car, for a total of $280. Amend tax return 2009 They are claiming their actual car expenses. Amend tax return 2009 Because they used the car 70% for business, they can deduct 70% of the $280, or $196, as a business expense. Amend tax return 2009 Real estate taxes. Amend tax return 2009   You can deduct on Schedule C or C-EZ the real estate taxes you pay on your business property. Amend tax return 2009 Deductible real estate taxes are any state, local, or foreign taxes on real estate levied for the general public welfare. Amend tax return 2009 The taxing authority must base the taxes on the assessed value of the real estate and charge them uniformly against all property under its jurisdiction. Amend tax return 2009   For more information about real estate taxes, see chapter 5 in Publication 535. Amend tax return 2009 That chapter explains special rules for deducting the following items. Amend tax return 2009 Taxes for local benefits, such as those for sidewalks, streets, water mains, and sewer lines. Amend tax return 2009 Real estate taxes when you buy or sell property during the year. Amend tax return 2009 Real estate taxes if you use an accrual method of accounting and choose to accrue real estate tax related to a definite period ratably over that period. Amend tax return 2009 Sales tax. Amend tax return 2009   Treat any sales tax you pay on a service or on the purchase or use of property as part of the cost of the service or property. Amend tax return 2009 If the service or the cost or use of the property is a deductible business expense, you can deduct the tax as part of that service or cost. Amend tax return 2009 If the property is merchandise bought for resale, the sales tax is part of the cost of the merchandise. Amend tax return 2009 If the property is depreciable, add the sales tax to the basis for depreciation. Amend tax return 2009 For information on the basis of property, see Publication 551, Basis of Assets. Amend tax return 2009    Do not deduct state and local sales taxes imposed on the buyer that you must collect and pay over to the state or local government. Amend tax return 2009 Do not include these taxes in gross receipts or sales. Amend tax return 2009 Excise taxes. Amend tax return 2009   You can deduct on Schedule C or C-EZ all excise taxes that are ordinary and necessary expenses of carrying on your business. Amend tax return 2009 Excise taxes are discussed briefly in chapter 1. Amend tax return 2009 Fuel taxes. Amend tax return 2009   Taxes on gasoline, diesel fuel, and other motor fuels you use in your business are usually included as part of the cost of the fuel. Amend tax return 2009 Do not deduct these taxes as a separate item. Amend tax return 2009   You may be entitled to a credit or refund for federal excise tax you paid on fuels used for certain purposes. Amend tax return 2009 For more information, see Publication 510, Excise Taxes. Amend tax return 2009 Travel, Meals, and Entertainment This section briefly explains the kinds of travel and entertainment expenses you can deduct on Schedule C or C-EZ. Amend tax return 2009 Table 8-1. Amend tax return 2009 When Are Entertainment Expenses Deductible? (Note. Amend tax return 2009 The following is a summary of the rules for deducting entertainment expenses. Amend tax return 2009 For more details about these rules, see Publication 463. Amend tax return 2009 ) General rule You can deduct ordinary and necessary expenses to entertain a client, customer, or employee if the expenses meet the directly-related test or the associated test. Amend tax return 2009 Definitions Entertainment includes any activity generally considered to provide entertainment, amusement, or recreation, and includes meals provided to a customer or client. Amend tax return 2009 An ordinary expense is one that is common and accepted in your field of business, trade, or profession. Amend tax return 2009 A necessary expense is one that is helpful and appropriate, although not necessarily required, for your business. Amend tax return 2009 Tests to be met Directly-related test Entertainment took place in a clear business setting, or Main purpose of entertainment was the active conduct of business, and You did engage in business with the person during the entertainment period, and You had more than a general expectation of getting income or some other specific business benefit. Amend tax return 2009   Associated test Entertainment is associated with your trade or business, and Entertainment directly precedes or follows a substantial business discussion. Amend tax return 2009 Other rules You cannot deduct the cost of your meal as an entertainment expense if you are claiming the meal as a travel expense. Amend tax return 2009 You cannot deduct expenses that are lavish or extravagant under the circumstances. Amend tax return 2009 You generally can deduct only 50% of your unreimbursed entertainment expenses. Amend tax return 2009 Travel expenses. Amend tax return 2009   These are the ordinary and necessary expenses of traveling away from home for your business. Amend tax return 2009 You are traveling away from home if both the following conditions are met. Amend tax return 2009 Your duties require you to be away from the general area of your tax home (defined later) substantially longer than an ordinary day's work. Amend tax return 2009 You need to get sleep or rest to meet the demands of your work while away from home. Amend tax return 2009 Generally, your tax home is your regular place of business, regardless of where you maintain your family home. Amend tax return 2009 It includes the entire city or general area in which your business is located. Amend tax return 2009 See Publication 463 for more information. Amend tax return 2009   The following is a brief discussion of the expenses you can deduct. Amend tax return 2009 Transportation. Amend tax return 2009   You can deduct the cost of travel by airplane, train, bus, or car between your home and your business destination. Amend tax return 2009 Taxi, commuter bus, and limousine. Amend tax return 2009   You can deduct fares for these and other types of transportation between the airport or station and your hotel, or between the hotel and your work location away from home. Amend tax return 2009 Baggage and shipping. Amend tax return 2009   You can deduct the cost of sending baggage and sample or display material between your regular and temporary work locations. Amend tax return 2009 Car or truck. Amend tax return 2009   You can deduct the costs of operating and maintaining your vehicle when traveling away from home on business. Amend tax return 2009 You can deduct actual expenses or the standard mileage rate (discussed earlier under Car and Truck Expenses), as well as business-related tolls and parking. Amend tax return 2009 If you rent a car while away from home on business, you can deduct only the business-use portion of the expenses. Amend tax return 2009 Meals and lodging. Amend tax return 2009   You can deduct the cost of meals and lodging if your business trip is overnight or long enough that you need to stop for sleep or rest to properly perform your duties. Amend tax return 2009 In most cases, you can deduct only 50% of your meal expenses. Amend tax return 2009 Cleaning. Amend tax return 2009   You can deduct the costs of dry cleaning and laundry while on your business trip. Amend tax return 2009 Telephone. Amend tax return 2009   You can deduct the cost of business calls while on your business trip, including business communication by fax machine or other communication devices. Amend tax return 2009 Tips. Amend tax return 2009   You can deduct the tips you pay for any expense in this list. Amend tax return 2009 More information. Amend tax return 2009   For more information about travel expenses, see Publication 463. Amend tax return 2009 Entertainment expenses. Amend tax return 2009   You may be able to deduct business-related entertainment expenses for entertaining a client, customer, or employee. Amend tax return 2009 In most cases, you can deduct only 50% of these expenses. Amend tax return 2009   The following are examples of entertainment expenses. Amend tax return 2009 Entertaining guests at nightclubs, athletic clubs, theaters, or sporting events. Amend tax return 2009 Providing meals, a hotel suite, or a car to business customers or their families. Amend tax return 2009 To be deductible, the expenses must meet the rules listed in Table 8-1. Amend tax return 2009 For details about these rules, see Publication 463. Amend tax return 2009 Reimbursing your employees for expenses. Amend tax return 2009   You generally can deduct the amount you reimburse your employees for travel and entertainment expenses. Amend tax return 2009 The reimbursement you deduct and the manner in which you deduct it depend in part on whether you reimburse the expenses under an accountable plan or a nonaccountable plan. Amend tax return 2009 For details, see chapter 11 in Publication 535. Amend tax return 2009 That chapter explains accountable and nonaccountable plans and tells you whether to report the reimbursement on your employee's Form W-2, Wage and Tax Statement. Amend tax return 2009 Business Use of Your Home To deduct expenses related to the part of your home used for business, you must meet specific requirements. Amend tax return 2009 Even then, your deduction may be limited. Amend tax return 2009 To qualify to claim expenses for business use of your home, you must meet the following tests. Amend tax return 2009 Your use of the business part of your home must be: Exclusive (however, see Exceptions to exclusive use , later), Regular, For your business, and The business part of your home must be one of the following: Your principal place of business (defined later), A place where you meet or deal with patients, clients, or customers in the normal course of your business, or A separate structure (not attached to your home) you use in connection with your business. Amend tax return 2009 Exclusive use. Amend tax return 2009   To qualify under the exclusive use test, you must use a specific area of your home only for your trade or business. Amend tax return 2009 The area used for business can be a room or other separately identifiable space. Amend tax return 2009 The space does not need to be marked off by a permanent partition. Amend tax return 2009   You do not meet the requirements of the exclusive use test if you use the area in question both for business and for personal purposes. Amend tax return 2009 Example. Amend tax return 2009 You are an attorney and use a den in your home to write legal briefs and prepare clients' tax returns. Amend tax return 2009 Your family also uses the den for recreation. Amend tax return 2009 The den is not used exclusively in your profession, so you cannot claim a business deduction for its use. Amend tax return 2009 Exceptions to exclusive use. Amend tax return 2009   You do not have to meet the exclusive use test if you use part of your home in either of the following ways. Amend tax return 2009 For the storage of inventory or product samples. Amend tax return 2009 As a daycare facility. Amend tax return 2009 For an explanation of these exceptions, see Publication 587, Business Use of Your Home (Including Use by Daycare Providers). Amend tax return 2009 Regular use. Amend tax return 2009   To qualify under the regular use test, you must use a specific area of your home for business on a continuing basis. Amend tax return 2009 You do not meet the test if your business use of the area is only occasional or incidental, even if you do not use that area for any other purpose. Amend tax return 2009 Principal place of business. Amend tax return 2009   You can have more than one business location, including your home, for a single trade or business. Amend tax return 2009 To qualify to deduct the expenses for the business use of your home under the principal place of business test, your home must be your principal place of business for that business. Amend tax return 2009 To determine your principal place of business, you must consider all the facts and circumstances. Amend tax return 2009   Your home office will qualify as your principal place of business for deducting expenses for its use if you meet the following requirements. Amend tax return 2009 You use it exclusively and regularly for administrative or management activities of your business. Amend tax return 2009 You have no other fixed location where you conduct substantial administrative or management activities of your business. Amend tax return 2009   Alternatively, if you use your home exclusively and regularly for your business, but your home office does not qualify as your principal place of business based on the previous rules, you determine your principal place of business based on the following factors. Amend tax return 2009 The relative importance of the activities performed at each location. Amend tax return 2009 If the relative importance factor does not determine your principal place of business, you can also consider the time spent at each location. Amend tax return 2009   If, after considering your business locations, your home cannot be identified as your principal place of business, you cannot deduct home office expenses. Amend tax return 2009 However, for other ways to qualify to deduct home office expenses, see Publication 587. Amend tax return 2009 Deduction limit. Amend tax return 2009   If your gross income from the business use of your home equals or exceeds your total business expenses (including depreciation), you can deduct all your business expenses related to the use of your home. Amend tax return 2009 If your gross income from the business use is less than your total business expenses, your deduction for certain expenses for the business use of your home is limited. Amend tax return 2009   Your deduction of otherwise nondeductible expenses, such as insurance, utilities, and depreciation (with depreciation taken last), allocable to the business is limited to the gross income from the business use of your home minus the sum of the following. Amend tax return 2009 The business part of expenses you could deduct even if you did not use your home for business (such as mortgage interest, real estate taxes, and casualty and theft losses that are allowable as itemized deductions on Schedule A (Form 1040)). Amend tax return 2009 The business expenses that relate to the business activity in the home (for example, business phone, supplies, and depreciation on equipment), but not to the use of the home itself. Amend tax return 2009 Do not include in (2) above your deduction for one-half of your self-employment tax. Amend tax return 2009   Use Form 8829, Expenses for Business Use of Your Home, to figure your deduction. Amend tax return 2009 New simplified method. Amend tax return 2009    The IRS now provides a simplified method to determine your expenses for business use of your home. Amend tax return 2009 The simplified method is an alternative to calculating and substantiating actual expenses. Amend tax return 2009 In most cases, you will figure your deduction by multiplying $5 by the area of your home used for a qualified business use. Amend tax return 2009 The area you use to figure your deduction is limited to 300 square feet. Amend tax return 2009 For more information, see the Instructions for Schedule C. Amend tax return 2009 More information. Amend tax return 2009   For more information on deducting expenses for the business use of your home, see Publication 587. Amend tax return 2009 Other Expenses You Can Deduct You may also be able to deduct the following expenses. Amend tax return 2009 See Publication 535 to find out whether you can deduct them. Amend tax return 2009 Advertising. Amend tax return 2009 Bank fees. Amend tax return 2009 Donations to business organizations. Amend tax return 2009 Education expenses. Amend tax return 2009 Energy efficient commercial buildings deduction expenses. Amend tax return 2009 Impairment-related expenses. Amend tax return 2009 Interview expense allowances. Amend tax return 2009 Licenses and regulatory fees. Amend tax return 2009 Moving machinery. Amend tax return 2009 Outplacement services. Amend tax return 2009 Penalties and fines you pay for late performance or nonperformance of a contract. Amend tax return 2009 Repairs that keep your property in a normal efficient operating condition. Amend tax return 2009 Repayments of income. Amend tax return 2009 Subscriptions to trade or professional publications. Amend tax return 2009 Supplies and materials. Amend tax return 2009 Utilities. Amend tax return 2009 Expenses You Cannot Deduct You usually cannot deduct the following as business expenses. Amend tax return 2009 For more information, see Publication 535. Amend tax return 2009 Bribes and kickbacks. Amend tax return 2009 Charitable contributions. Amend tax return 2009 Demolition expenses or losses. Amend tax return 2009 Dues to business, social, athletic, luncheon, sporting, airline, and hotel clubs. Amend tax return 2009 Lobbying expenses. Amend tax return 2009 Penalties and fines you pay to a governmental agency or instrumentality because you broke the law. Amend tax return 2009 Personal, living, and family expenses. Amend tax return 2009 Political contributions. Amend tax return 2009 Repairs that add to the value of your property or significantly increase its life. Amend tax return 2009 Prev  Up  Next   Home   More Online Publications