4 More Tips to Avoid Tax Audit When You Are Self-Employed
This is the second part of our tips to avoid tax Audit when you are self-employed. Be sure to check out our first part by clicking HERE. Once you have read that we can proceed on giving you another set of tips!
5. Business or pleasure?
Business expenses get tricky, but it all depends on the income and the business industry you are involved in. If you have a lot of super expensive luxury trips and expensive 5-star restaurant dinners and try to write them off for business it will set a red flag off. You must have a detailed record of everything and everyone involved. The restaurant, the purpose, nature of the discussion, the people involved, and the amount spent.
6. Work from home and avoid tax audit when you are self-employed
Yes! It is wonderful that you can potentially take a percentage off your rent, but if you share your office space with a child’s playroom, or a family den it will be harder to prove that you have an exclusive home office. The IRS applies a lot of scrutiny to this deduction, so it is very worthwhile to make sure that this deduction is claimed correctly. Moore Accounting Services can help you determine how to correctly claim this expense.
The Earned Income Tax Credit is provided to low-income families meeting certain criteria. Moore Accounting Services can advise you if you are eligible for this deduction as part of the preparation process.
8. Let a Professional file your tax return to avoid tax audit when you are self-employed
Self-prepared returns are the most likely to be audited. The IRS assumes because you are filing self-prepared under self-employed that your knowledge is limited. Tax law is complex, filing why your self-employed makes it more so. If you would like assistance, we’re available for service 24/7 here!
Questions? Call us at 864-283-0644 or email us at firstname.lastname@example.org. Let us help you get Moore for your money.
Let us help you get Moore for your Money.
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