E[acute accent]If you own stock or bonds in a company that stopped doing business and has no intention of restarting operations, you can deduct
your cost basis in the stock or bond.
In some cases, you might not be able to justify a complete write-off but can deduct
at least a portion of the cost.
Likewise, in this case, the court held that Cinergy could deduct
its costs since the asbestos removal and encapsulation fixed a problem that could have shortened the building's useful life.
One outstanding issue for taxpayers is whether a buyer should deduct
or capitalize amounts it later pays on a liability in excess of the original amount capitalized.
The lower courts said the doctor could deduct
the cost of the home, since he spent several hours a day there; therefore, it was essential to his business.
Taxpayers who seek to deduct
interest paid on education loans must meet Sec.
5% level of AGI required to deduct
medical expenses because they don't know what's eligible, Howell says.
This means that SMBs will still be able to deduct
up to $100,000 toward the cost of new technologies and other office equipment," Morgan said.
This article discusses the circumstances under which (1) former business owners can deduct
interest on these payments and (2) guarantors can take a bad debt deduction when required to pay the outstanding debt.
In a recent letter ruling, the IRS explained the circumstances under which companies may be able to currently deduct
some ERP software costs.
Those who live in one of seven states without a state income tax may now deduct
their state sales tax in tax years 2004 and 2005.
Clearly, taxpayers cannot deduct
expenses paid on behalf of another on their individual returns.
IRC section 162(a) allows a taxpayer to deduct
all ordinary and necessary expenses paid or incurred in "carrying on" a trade or business, including, under section 163(a), interest paid or accrued during the tax year.
Under the new rules, it is possible for dentists, lawyers, real estate agents, independent consultants, self-employed individuals and others to deduct
more dollars into a defined benefit retirement plan.
For an S shareholder to deduct
iris or her pro-rata share of S losses under Sec.