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Schedule C

29 / 01 / 2016 by Greg Freyman, CPA in Business Tax

Schedule C Hot Topics

With tax season upon us, we have compiled a list of hot topics the IRS has been known to closely examine with the filing of a Schedule C – Profit or Loss from Business.

The IRS’s primary concerns revolves around the reliability/duplication of information provided on the Schedule C as well as the methods used for recordkeeping and presentation in the following areas:

 

Gross Receipts

An increase in income within the business should be considered taxable.

If the payment of income would not have been received without the existence of the business, the income should be considered business income.  This includes IOUs, cash, etc. So remember, if the payment crosses the door of your business, that payment of income should be considered part of your business income.

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20 / 05 / 2015 by Greg Freyman, CPA in Personal Tax

Can I Deduct Educational Expenses For Work?

Question:
I’m employed by a large company and earn around $250,000 per year. In addition, I have about $100,000 in annual business income from consulting that is reported on Schedule C. I attend a college in Chicago, and it is a post-secondary educational facility. Can I claim the education costs on Schedule C, and the out-of-town travel costs associated with my education? I’m receiving mixed answers online for whether or not I can deduct educational expenses for work.

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04 / 02 / 2015 by Greg Freyman, CPA in State Tax

How State Taxes Impact Federal Tax Returns

Let us review the concept of how state taxes impact federal tax returns.

On New York State tax forms IT-201-I, or IT-150, or NYC-202(4), the taxpayer is subject to either individual or business income tax. However, on Schedule A or Schedule C of federal form 1040, the taxpayer may deduct state and local income taxes. Specifically, if the taxpayer elects to itemize deductions on Schedule A, state and local taxes would be included in the schedule. Please note though that the state taxes remitted during the year are generally not equal to the total amount due at the end of the tax year. Moreover, the taxpayer will end up either owing additional taxes or receiving a refund for taxes overpaid.

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