Business expenses are the costs of carrying on a trade or business, and they are usually deductible if the business is operated to make a profit. This mini-course reviews various expenses that businesses may deduct and the requirements that must be met for those expenses to qualify for deduction. Furthermore, practitioners can use this as a guide to determine which of their clients taxes are deductible as business expenses. As a result of studying the assigned materials, you should be able to meet the objectives listed below.
ASSIGNMENT
At the start of the materials, participants should identify the following topics for study:
* Section 162
* Expenses of not-for-profit activities
* Rent expenses
* Interest expense
* Deductible taxes
* Other selected deductible costs
* Amortization
* Depletion -613
* Business bad debts
* Depreciation
Learning Objectives
After reading the materials, participants will be able to:
1. Cite the elements of 162 and the limitations imposed by the not-for-profit provisions stating how these elements and restrictions impact business deductions such as cost of goods sold, leases, taxes, loan points, and interest expense.
2. Determine the corporate dividends received deduction, identify the cost allocation on the business use of a residence and specify casualties, thefts, and research costs in the context of business deductions under 162.
3. Recognize methods of amortization for business startup, organizational costs, and 179 intangibles with the cost depletion methods used on natural resources.
4. Identify depreciation rules related to ACRS and MACRS, and cite the elements of the business bad debt provisions under 166.