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Tax.appeal.168
Tax.appeal.168, Tax Accountant
Category: Tax
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Experience:  Nearly 30 years of varied tax industry exp. Tax Biz owner
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what are considered reasonable deductible business expenses

Resolved Question:

what are considered reasonable deductible business expenses for a 1099 employee for the purposes of determining alimony/
Submitted: 1 year ago.
Category: Tax
Expert:  Tax.appeal.168 replied 1 year ago.
Welcome, THANK YOU for using Just Answer. My goal is to help make your life...a little...LESS taxing.

Let me clarify that if you receive a 1099, you should be considered an independent contractor, not an employee. Employees receive W2s. Reasonable business expense deductions refers to those expenses which will normally be incurred in a particular trade or business. If the expense is a legitimate expense, as an independent contractor you can deduct it. Independent contractors can deduct legitimate expenses that are NECESSARY and REASONABLE. Here's an example, you are traveling for business, you can pay $100 per night for a hotel room, or $500 per night for a hotel room. You decide to pay the $500/per night because you wanted to treat yourself. Likely this expense will be denied because it is not considered reasonable or necessary, as there was another option available. For more information regarding 1099 expenses, you can refer to the Form Schedule C instructions.

Link to form Schedule C/Instructions:

http://www.irs.gov/pub/irs-pdf/f1040sc.pdf
http://www.irs.gov/pub/irs-pdf/f1040sc.pdf

If you are unclear about something, please ask for clarification before selecting a rating of 1 or 2.

Thank you in advance for using JUST ANSWER.
Customer: replied 1 year ago.
I was looking for a more specific answer or perhaps the place where I can research this myself. I am unable to find any information. For example, Is depreciation considered a business expense for the purpose of alimony ? What is considered a reasonable car expense? ,
Expert:  Tax.appeal.168 replied 1 year ago.
Hello again Lynn,

Let's just take out the words... "for the purpose of alimony" away. Using those words just confuse the issue. The ability to deduct business expenses has nothing to do with the outside reasoning, for alimony purposes, etc. As stated previously, necessary and reasonable, or customary and reasonable expenses are deductible as long as they are directly related to your trade or business. Reasonable care expenses are as follows:

Automobile Expenses directly attributable to the conduct of business are deductible.

Exception: commuting expenses (between your home and regular business location) are not deductible. (If your home office is your principal place of business, there are no miles disallowed for commuting.)

Holding a business meeting in the car while commuting does not turn the commute into a business deduction. However, going to a business meeting on the way to the office allows a deduction for the additional mileage over that required to get to work.

Exceptions to exception (deductions are allowed for commuting):
If you need your car to carry large items for work.

If you work at two or more places in a day you can deduct the cost of getting from one place to the other, or
If you are on temporary assignment out of town.

DEPRECIATION is already built into the standard rate; no depreciation is allowed for cars for which the standard rate is chosen.

You can refer to the following webpage for a more detailed breakdown:

http://www.wwlaw.com/icdeduct.htm
Customer: replied 1 year ago.
Hello,

Thank for the clarifications, however, the words for the purpose of alimony are significant in that, my ex spouse is required to pay alimony based on his income but less reasonable business expenses. The settlement agreement doesn't specifically state what are reasonable business expenses, he is using all deductions on schedule C to determine what he owes me. I am trying to avoid filing a complaint for contempt as he refuses to agree with "reasonable business expenses" so i was hoping to reference a particular finding or statute.
Thank you again.
Expert:  Tax.appeal.168 replied 1 year ago.
Lynn,

So, you're looking for a statute...? You can refer to the following for the verbage of the statute relating to this matter:

http://www.law.cornell.edu/uscode/text/26/162

Thank you again for using JUST ANSWER.

Tax.appeal.168, Tax Accountant
Category: Tax
Satisfied Customers: 2522
Experience: Nearly 30 years of varied tax industry exp. Tax Biz owner
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