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Lev, Tax Advisor
Category: Tax
Satisfied Customers: 29938
Experience:  Taxes, Immigration, Labor Relations
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My wife and I make high income. What is a business we can

Customer Question

my wife and I make high income. What is a business we can enter allowing many types of and amounts of business deductions We need this greaT ADVISE
Submitted: 1 year ago.
Category: Tax
Expert:  Lev replied 1 year ago.
Hi and welcome to our site!As you just started the business it is a good time to set your books.You would need to account for all your business expenses and keep all supporting documents.There are special requirements for record keeping Be sure you become familiar with following publication, such as receipts, canceled checks, and other documents that support an item of income, a deduction, or a credit appearing on a return must be kept as long as they may become material in the administration of any provision of the Internal Revenue Code, which generally will be until the period of limitations expires for that return. For assessment of tax you owe, this period is generally 3 years from the date you filed the return. Returns filed before the due date are treated as filed on the due date..
Expert:  Lev replied 1 year ago.
You will report your income and may deduct qualified expenses.Business expenses are the cost of carrying on a trade or business. These expenses are usually deductible if the business operates to make a profit.To be deductible, a business expense must be both ordinary and necessary. An ordinary expense is one that is common and accepted in your trade or business. A necessary expense is one that is helpful and appropriate for your trade or business.- you may report all business income and expenses - on the schedule C - net income (after deductions) will be reported on the form 1040 line 12 - the business has net income over $400, it may be required to file Schedule SE, Self-Employment Tax net self-employment income is subject to 15.3% self-employment tax.Self-employment taxes from schedule SE will go to the form 1040 line 57 - - you will deduct half of self-employment taxes on the line 27.Generally - that all you needs tax purposes.You may also find helpful following publication Regarding home office and car expenses - we will continue conversation if all above is clear ?.I appreciate if you take a moment to rate the answer.Experts are ONLY credited when answers are rated positively.If you still have any doubts, need clarification - please be sure to ask.I am here to help you with all tax related issues.