Tax Deduction Question
12-13-2014, 05:07 AM
#11
H&r hosed you with the home office deduction. You just setup a huge tax liability when/if you ever sell your home because part of it is a capital asset which selling your home later will cause that percentage to be subject to capital gains taxes vs a full deferral of taxes. Plus home offices raises audit red flags. If you are only using your truck a few times a year for delivering product, it sounds like this might not be a full time business as compared to a "hobby" business. Another audit flag for home offices.
Take the standard milage deduction and contract with a professional tax person. You don't need your tax guy setting you up for a big surprise
Take the standard milage deduction and contract with a professional tax person. You don't need your tax guy setting you up for a big surprise
It was 15 years ago. Home and business are a distant memory..
12-13-2014, 07:18 AM
#12
It's funny how our tax code can be interpreted so many different ways. I own a tax and accounting firm and have been preparing taxes professionally for quite a few years. If someone came to me with this situation, I would not consider taking a deduction for the cost of, or a portion of the cost of the truck topper. It's part of the truck and you are receiving a deduction already for business use of your truck. If you were recording actual expenses and using those to determine the deduction on your truck, I might consider factoring in a % of the cost of the topper which is the same % of actual business use of your truck. Note that actual expenses are an alternate method of determining the deduction. Most people shy away from this method because it requires more recordkeeping and you still have to maintain a mileage log. Hope this helps
The following 2 users liked this post by EB55:
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12-13-2014, 12:37 PM
#13
Senior Member
It's funny how our tax code can be interpreted so many different ways. I own a tax and accounting firm and have been preparing taxes professionally for quite a few years. If someone came to me with this situation, I would not consider taking a deduction for the cost of, or a portion of the cost of the truck topper. It's part of the truck and you are receiving a deduction already for business use of your truck. If you were recording actual expenses and using those to determine the deduction on your truck, I might consider factoring in a % of the cost of the topper which is the same % of actual business use of your truck. Note that actual expenses are an alternate method of determining the deduction. Most people shy away from this method because it requires more recordkeeping and you still have to maintain a mileage log. Hope this helps
12-13-2014, 03:13 PM
#14
It's funny how our tax code can be interpreted so many different ways. I own a tax and accounting firm and have been preparing taxes professionally for quite a few years. If someone came to me with this situation, I would not consider taking a deduction for the cost of, or a portion of the cost of the truck topper. It's part of the truck and you are receiving a deduction already for business use of your truck. If you were recording actual expenses and using those to determine the deduction on your truck, I might consider factoring in a % of the cost of the topper which is the same % of actual business use of your truck. Note that actual expenses are an alternate method of determining the deduction. Most people shy away from this method because it requires more recordkeeping and you still have to maintain a mileage log. Hope this helps
If OP wants a deduction for the topper, he can switch to determining his deduction using ACTUAL expenses, and depreciate the truck (and topper.) One can't switch from the actual method to standard mileage rate. I anticipate this would be a major PITA, and probably not worth his time, since the use is limited (per the original message.)
That said, this is the correct approach - he can do whatever he can get away with....including taking it to H & R Block (although I really wouldn't recommend that approach.) When someone says "this is what my preparer did" - that doesn't mean that it's the correct way/would hold up on audit.
I'm a CPA as well.
