Tax Deductions for Professionals

Pay Less to the IRS

Tax Deductions for Professionals

Select Your Format

eBook (Downloadable)

Format: PDF, EPUB, MOBI

Price: $39.99 $27.99

You Save: $12.00 (30% discount)

Book & eBook

MORE INFO

Price: $39.99 $30.99

You Save: $9.00 (22% discount)

Tax Deductions for Professionals

, 14th Edition

A tax deduction guide just for professionals

Reduce your tax burden with this guide to the unique deductions you qualify for as a licensed professional. Comprehensive, easy-to-read, and filled with interesting examples, Tax Deductions for Professionals breaks down common deductions you may be able to take, including:

  • start-up and operating expenses
  • health deductions
  • vehicles and travel

Completely updated to cover the new Tax Cuts and Jobs Act.

See below for a full product description.

Product Details

Winner of the Independent Book Publisher's Association's Benjamin Franklin Award

Keep your taxes under control!

Architects, lawyers, dentists, chiropractors, doctors and other licensed professionals are subject to special tax rules. With this book, learn how to pay less to the IRS at tax time by taking advantage of valuable tax deductions you are entitled to take.

Find out how to deduct:

  • start-up expenses
  • medical expenses under Obamacare
  • retirement plan contributions
  • continuing education costs
  • vehicles, meals and travel, and
  • home office expenses.

Tax Deductions for Professionals will also help you choose the best legal structure, with detailed information on limited liability companies, partnerships and professional corporations.

The 14th edition is completely updated to cover the new Tax Cuts and Jobs Act.

 

“Aimed at anyone who runs a professional practice, including doctors, dentists, lawyers, engineers, architects and even chiropractors – to say nothing of accountants.”
- Accounting Today

“Thorough, straightforward and specific...contains all the information you need to take advantage of every money - saving opportunity.”
- Architectural West

“Step-by-step strategies for making your tax bill as low as possible.”
- Cedar Rapids Gazette

 

ISBN
9781413325720
Number of Pages
456

About the Author

Table of Contents

Introduction

1. Tax Deduction Basics

  • How Tax Deductions Work
  • The Value of a Tax Deduction
  • What Professionals Can Deduct

2. Choice of Business Entity

  • Types of Business Entities
  • Limiting Your Liability
  • The Four Ways Business Entities Are Taxed
  • Comparing Tax Treatments
  • Should You Change Your Business Entity or Tax Treatment?

3. Operating Expenses

  • Requirements for Deducting Operating Expenses
  • Operating Expenses That Are Not Deductible
  • Tax Reporting

4. The Pass-Through Tax Deduction

  • You Must Have a Pass-Through Business
  • You Must Have Qualified Business Income
  • You Must Have Taxable Income
  • Deduction for Taxable Income Below $157,500 ($315,000 for Marrieds)
  • Deduction for Income Above $157,500 ($315,000 for Marrieds)
  • Taking the Pass-Through Deduction
  • Strategies to Maximize the Pass-Through Deduction

5. Car and Local Travel Expenses

  • Deductible Local Transportation Expenses
  • The Standard Mileage Rate
  • The Actual Expense Method
  • Other Local Transportation Expenses
  • Reporting Transportation Expenses on Schedule C
  • When Clients Reimburse You
  • Professionals With Business Entities

6. Long Distance Travel Expenses

  • What Is Business Travel?
  • What Travel Expenses Are Deductible
  • How Much You Can Deduct
  • Maximizing Your Business Travel Deductions
  • Travel Expenses Reimbursed by Clients

7. The Home Office Deduction

  • Qualifying for the Home Office Deduction
  • Calculating the Home Office Deduction
  • Simplified Home Office Deduction Method
  • How to Deduct Home Office Expenses

8. Deductions for Outside Offices

  • If You Rent Your Office
  • If You Own Your Office
  • If You Lease a Building to Your Practice

9. Deducting Long-Term Assets

  • What is a Long-Term Asset
  • Special Rules for Deducting Inexpensive Property
  • Deducting Long-Term Personal Property: Bonus Depreciation, Section 179, Regular Depreciation
  • Bonus Depreciation
  • Section 179 Expensing
  • Deducting Repairs and Improvements
  • Regular Depreciation
  • Deducting Real Property
  • Tax Reporting and Record Keeping
  • Leasing Long-Term Assets

10. Start-Up Expenses

  • What Are Start-Up Expenses?
  • Starting a New Practice
  • Buying an Existing Practice
  • Expanding an Existing Practice
  • When Does a Professional Practice Begin?
  • How to Deduct Start-Up Expenses
  • Organizational Expenses

11. Medical Expenses

  • The Affordable Care Act (Obamacare)
  • The Personal Deduction for Medical Expenses
  • Self-Employed Health Insurance Deduction
  • Deducting Health Insurance as an Employee Fringe Benefit
  • Tax Credits for Employee Health Insurance
  • Adopting a Health Reimbursement Arrangement
  • Health Savings Accounts

12. Inventory

  • What Is Inventory?
  • Deducting Inventory Costs

13. More Deductions

  • Advertising
  • Business Bad Debts
  • Casualty Losses
  • Charitable Contributions
  • Clothing
  • Disabled Access Tax Credit
  • License Fees, Dues, and Subscriptions
  • Education Expenses
  • Entertainment and Meals
  • Gifts
  • Insurance for Your Practice
  • Interest on Business Loans
  • Legal and Professional Services
  • Taxes

14. Hiring Employees and Independent Contractors

  • Employees Versus Independent Contractors
  • Tax Deductions for Employee Pay and Benefits
  • Reimbursing Employees
  • Employing Your Family
  • Tax Deductions When You Hire Independent Contractors

15. Professionals Who Incorporate

  • Automatic Employee Status
  • Paying Yourself
  • Employee Fringe Benefits
  • Shareholder Loans

16. How You Pay Business Expenses

  • Your Practice Pays
  • Using Personal Funds to Pay for Business Expenses
  • Your Client Reimburses You
  • Accountable Plans

17. IRS Audits

  • Anatomy of an Audit
  • Tax Shelters, Scams, and Schemes

18. Record Keeping and Accounting

  • Recording Your Expenses
  • Your Accounting System
  • Documenting Your Deductions
  • Accounting Methods
  • Tax Years

Index

Sample Chapter

Introduction

If you’re a professional, no one needs to tell you that taxes are one of your largest expenses. The best way to minimize your taxes and maximize your take-home income is to take advantage of every tax deduction available to you.

The IRS will never complain if you don’t take all the deductions you’re entitled to—and it certainly doesn’t make a point of advertising ways to lower your taxes. In fact, many professionals miss out on all kinds of deductions every year simply because they aren’t aware of them—or because they neglect to keep the records necessary to back them up.

That’s where this book comes in. Specially tailored for the unique needs of professionals, it shows you how you can deduct all or most of your business expenses from your federal taxes—everything from advertising to vehicle depreciation.

This book, the first of its kind, is about tax deductions for all types of professionals, including:

  • accountants
  • architects
  • chiropractors
  • consultants
  • dentists
  • doctors
  • engineers
  • lawyers
  • marriage and family therapists
  • optometrists
  • pharmacists
  • psychologists, and
  • veterinarians.

It can be used by professionals who work by themselves, or by those involved in group practices. You can use this book no matter how your practice is legally organized—whether you are a sole proprietor, or are involved in a professional corporation, a partnership, or an LLC.

This is not a tax preparation guide—we do not show you how to fill out your tax forms. (By the time you do your taxes, it may be too late to take deductions you could have taken if you had planned the prior year’s business spending wisely and kept proper records.) Instead, this book gives you all the information you need to maximize your deductible expenses—and avoid common deduction mistakes. You can (and should) use this book all year long, to make April 15 as painless as possible.

This year more than ever you’ll need guidance when it comes to understanding your taxes. Congress passed the Tax Cuts and Jobs Act at the end of 2017, the most sweeping change to the tax code in over 30 years. Most of these changes went into effect starting in 2018. We explain the new tax law and how it affects business deductions for professionals including:

  • new individual and corporate tax rates (see Chapter 1)
  • a new 20% tax deduction for pass-through business owners, which includes many professionals (see Chapter 4)
  • changes to depreciation rules allowing faster write-offs of business property, including vehicles (see Chapters 5 and 6), and
  • the elimination of deductions for business-related entertainment and certain meals (see Chapter 13).

Even if you work with an accountant or another tax professional, you need to learn about tax deductions. No tax professional will ever know as much about your business as you do; and you can’t expect a hired professional to search high and low for every deduction you might be able to take, especially during the busy tax preparation season. The information in this book will help you provide your tax professional with better records, ask better questions, obtain better advice—and, just as importantly, evaluate the advice you get from tax professionals, websites, and other sources.

If you do your taxes yourself (as more and more small business owners are doing, especially with the help of tax preparation soft­ware), your need for knowledge is even greater. Not even the most sophisticated tax preparation program can decide which tax deductions you should take or tell you whether you’ve overlooked a valuable deduction. This book can be your legal companion, providing practical advice and information so that you can rest assured that you are not paying more to the IRS than you need to.

 

Get Updates to This Book on Nolo.com

When there are important changes to the information in this book, we’ll post updates online, on a page dedicated to this book.

Customers Who Bought This Item Also Bought