must be 6x60" plasmas..or you paying like $1 per kwh? how you come up with $500? imo 50 to 100$ sounds more accurate. this is exactly how those flags are raised http://gadgetopia.com/post/2438
silver914- Spot on. This site is full of bullshitters and knobs who try and give all kinds of advice from how to "Raise money for a Hedge Fund" to Tax bullshit and 90% are w2! They fill out a fucking EZ form.
And you know his how? Because you are an enrolled agent for H&R Block? LMAO I like another poster's comment that because he has never been audited on it, he never will. I guess the history of litigation on this issue between the IRS and taxpayers doesn't mean anything.
As to your first remark, perhaps you should research exactly what an Enrolled Agent is. I'm not the guy at the desk in the office. Better yet, go take the test to become one. And as for the history of litigation? No, it doesn't because you don't know howthe respondents filled out the form. I know because I'm the one representing the respondent in court.
Since its well known that filing a sched C does increase your chances of being audited I guess you are saying that the home office deduction also increases your chances.
I've taken a home office deduction for 11 years, and never had it raised as an issue, even during those few times when I was questioned about other small issues related to trading. The home office was NEVER an item on their list. If the space you are using is dedicated to work...and you can prove it...then you should take every available deduction.
Again, assumptions. Filing a C does not increase your chances of an audit. How you file it does. People, it's not the form(s) that trigger an audit...it's what you put on them. Why do you think box B on schedule C asks for a Principal Business or Professional Activity Code? The IRS has amassed a database of parameters within which each business or activity typically has a value. In other words if you enter depreciation expenses of $60,000 on income of $70,000 and you claim to be a janitorial service code 561720 as a sole proprietor with no employees, then yes you will more than likely be audited. Especially if you ALSO receive a W-2 from Lowe's for $42,000. So what triggers the audit, the schedule C or the W-2? It is the W-2 that triggers the audit, not the schedule C. Lots of lame assholes try to claim the business expenses of a hobby or a "paper" business to offset the income from their real employment. Want to know what really triggers an audit? That 2106 for vehicle expenses, not the 8829.
Just thinking out loud here, but couldnât you have your LLC or Corp, if you trade in an entity, buy or rent your residence and thus all payments be deductable? I personally do not do this but what would keep this form being legit?
False choice. A return that contains a schedule C has a higher chance of being audited than a return that does not (all else being equal). Putting questionable answers on the schedule C raises your risk much more - no argument there.
The homeowner (you) would be required to file a schedule C to report the rental income from the entity and depreciate the part of the home being rented. So on top of being taxed twice you still deal with the depreciation aspect when you sell the house. The short answer is there is no tax benefit. As your tax preparer I would refuse to do it. Your use of the same address as your home and the business address would attract questions from the IRS, but maybe not an audit. Most audits are informational anyway. That first letter they send you is just a request for more information so that they better understand what you are doing if it doesn't immediately make sense to them. It usually doesn't turn into an audit even though when a client gets one of those we prepare for one anyway. By the time the second letter arrives it's too late. Best to head them off at the pass.