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Boy, no wonder the business has a loss. You are too lazy to organize your expenses efficiently to maximize deductions, so I can only wonder how lazy you are in terms of developing and growing your business.
I agree and it is very common. Many times, those who aren't too great at keeping track of their expenses aren't too great at tracking their receivables. So too much money is going out and not enough is coming in.
Its like re IRS actually believes that someone operated a 'business' for 12 months at a total loss while dinning out and writing everything off.
Gotta love America.
The land of smoke and mirrors. Let the facade continue.
If you are entertaining clients and attending meetings.... I mean when a client comes to my place of business I get catering for lunch or when I am offering good coffee to hear my elevator pitch.
But I also went on dates where we also talked about business.
And that time when I was in the bar with my buds, we so talked about business for like 5 mins before we ordered another round....
When I was younger, we would have business strategy discussions at a strip bar, so how are going to tell me that a lap dance is a not a legitimate business expense.
You should be keeping a spreadsheet with (1) categories of all deductible expenses, (2) date, (3) amount, and (4) description during the tax year. Update at least weekly. Don't forget vehicle and home office expenses. In January, this business expenses spreadsheet should be printed and kept with your income statement and hard-copy receipts in a Tyvek mailer, preferably in a fireproof safe.
When the credit card annual statements arrive the following January, sort by date and compare to make sure you captured everything. Also provides good back-up detail of the charges.
I also retain all original receipts with pen-and-ink notations, chronologically sorted. Another method: sort by deductible category and tape to letter paper -- easier to file or copy.
Keep all of this for 8 years.
The small business recordkeeping seems insurmountable if you try to do it all in February of the following year. But if you do it for two or three hours per week during the tax year, you barely notice it.
I have a fireproof safe for documents. But since none of my friends referred me to a good accountant I am stuck doing it myself. Since my business revenues are all check based, all of my business transactions go though a bank with the exception of a cleaning service for which I pay cash. So I just look at my Amazon purchases for the year to get most of my supplies and assets purchased.
I am not willing to spend that much time on record keeping. It's boring and is not in my job description.
All this tax talk got me thinking that I have not been to a strip club in years !
Boy, no wonder the business has a loss. You are too lazy to organize your expenses efficiently to maximize deductions, so I can only wonder how lazy you are in terms of developing and growing your business.
Turbo tax says that my audit risk is low, so there is yet room to mess around !
But I was reading online that Coffee is a supply expense. I like dark chocolates with my coffee, personally ! Does that means that dark chocolates is also a good supply expense?
Turbo tax says that my audit risk is low, so there is yet room to mess around !
But I was reading online that Coffee is a supply expense. I like dark chocolates with my coffee, personally ! Does that means that dark chocolates is also a good supply expense?
Could be.....yes.
I send flowers to customers sometimes........I write that off.
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IRS Choice
