Category Archives: IRS Deductions

Real Estate Professional Passive Loss Rules Exception – Paul Gaulkin CPA

a woman real estate professional

When it comes to passive loss rules that deal with real estate, a real estate professional may elect to treat all interest in real property trades and businesses as one activity. The IRS defines a real estate professional as a person who derives more than one half of all their personal services from real property trades or businesses in which they materially participate. A real estate professional must have rendered a total of more than 750 hours of personal services … Read more

Using Suspended Passive Activity Losses – Paul Gaulkin CPA

Piggy bank with change infront

Disallowed passive activity losses are generally suspended and may be carried forward indefinitely until they are able to be used to offset passive income in future years. The IRS has this suspension to basically prevent taxpayers from benefiting from a net loss that is derived from passive activities until the economic interest in the activity is completely relinquished. Qualifying Disposition of Passive Activity When a qualifying disposition of the passive activity that generated the losses occurs, the suspended losses become … Read more

Deductions That Can Get You Audited

You may have wondered what the IRS looks out for when identifying a tax return that is due for an audit. There are many different areas the IRS will examine to determine if a taxpayer is telling the truth or not. Below we will list some of the less talked about issues the IRS will look out for when considering an investigation. Claiming Large Charitable Deductions The IRS has an average that it uses to compare your claimed income to … Read more

Medical Deduction: Deduct Self Employment Medical Costs

Taking a deduction for self-employed medical plan costs can seem confusing but it is actually very simple. First you need to determine if you qualify for the deduction. One of the main requirements of taking this deduction is to see if you filed a Schedule C or F on your federal tax return. You can also take such a deduction if you receive self-employment earnings through a partnership or through an S corporation if you own at least 2 percent … Read more

Home Office Deduction: The Facts on Having a Home Office

If you have or are thinking of starting a home based business, there is a tax deduction that is available for you solely for the space that you operate in your home that is dedicated to a home office. A Home Office Deduction Can Be Risky There is a lot of talk about how this deduction can be a risky thing to use because of the chance of IRS audit. Maybe you have read that you need to see clients … Read more

IRS Deductions For Telephones

Ever since the 1980s, the IRS created rules regarding telephone deductibility from a home office perspective.According to the tax agency, in order to claim a telephone expense as a deduction on your yearly taxes, there are certain guidelines that must be followed and certain criteria that must be met. Telephone Deduction Specifics So what does that mean for me, you, and other at home workers? Let’s break it down. I run a land line so that I can have a … Read more