I operate an in-home business. What business documents do I need to claim business expenses?
To claim business expenses you will need to provide related business documents including receipts for all of the business expenses you want to deduct. Your documents should show:
- Essential character of the expense
The documents can include:
- Cancelled checks
- An account book
- Customer account book
- Expense report
- Accounting log
- A diary
- Other record that duplicates information shown on a receipt kept at or near the time of the expense
After you file, you should keep these business documents with a copy of your tax return.
For the business use of your home, you’ll allocate the home office expenses. This is based on the percentage of the square footage of your home used regularly and exclusively for business.
Expenses you might incur when running a business from your home include:
- Real estate taxes
- Qualified mortgage insurance premiums
- Deductible mortgage interest
- Casualty losses
- Security system
- Utilities and services
If you’re itemizing deductions, the IRS generally allows you a medical expenses deduction if you have unreimbursed expenses that are more than 7.5% of your adjusted gross income for tax years 2017 or 2018. You can deduct the cost of care from several types of practitioners at various stages of care.
What happens to your taxes after marriage? Learn how marriage can lead to changes in tax filing and returns at H&R Block.
Many are surprised to learn that even side gigs come with a tax price. H&R Block Tax pro's have arranged expert tips for those who owe direct sales taxes.
Tax season is right around the corner! Consider how the withholding allowances claimed on your Form W-4 could affect your income tax refund by visiting the Tax Information Center blog.