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How Can I File My 2012 Taxes Online

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How Can I File My 2012 Taxes Online

How can i file my 2012 taxes online IRAs and Other Retirement Plans Table of Contents 2002 ChangesSimplified Employee Pensions (SEPs) 403(b) Plans Later ChangeDeemed IRAs 2002 Changes Simplified Employee Pensions (SEPs) Contribution limit increased. How can i file my 2012 taxes online   For plan years beginning after December 31, 2001, the annual limit on the amount of employer contributions to a SEP increases to the lesser of the following amounts. How can i file my 2012 taxes online 25% of an eligible employee's compensation. How can i file my 2012 taxes online $40,000 (subject to cost-of-living adjustments after 2002). How can i file my 2012 taxes online Deduction limit. How can i file my 2012 taxes online   For years beginning after 2001, the following changes apply to the SEP deduction limit. How can i file my 2012 taxes online Elective deferrals (SARSEPs). How can i file my 2012 taxes online   Elective deferrals under a SARSEP are not subject to the deduction limit that applies to employer contributions. How can i file my 2012 taxes online Also, elective deferrals are not taken into account when figuring the amount you can deduct for employer contributions that are not elective deferrals. How can i file my 2012 taxes online Definition of compensation. How can i file my 2012 taxes online    Compensation for figuring the deduction for employer contributions includes elective deferrals under a SARSEP. How can i file my 2012 taxes online More information. How can i file my 2012 taxes online   For more information about SEPs, see Publication 560, Retirement Plans for Small Business. How can i file my 2012 taxes online 403(b) Plans Figuring catch-up contributions. How can i file my 2012 taxes online   When figuring allowable catch-up contributions, combine all contributions made by your employer on your behalf to the following plans. How can i file my 2012 taxes online Qualified retirement plans. How can i file my 2012 taxes online 403(b) plans. How can i file my 2012 taxes online Simplified employee pensions (SEP). How can i file my 2012 taxes online SIMPLE plans. How can i file my 2012 taxes online   The total amount of the catch-up contributions to all plans maintained by your employer cannot exceed the annual limit. How can i file my 2012 taxes online For 2002, the limit is $1,000. How can i file my 2012 taxes online Rollovers to and from 403(b) plans. How can i file my 2012 taxes online   If a distribution includes both pre-tax contributions and after-tax contributions, the portion of the distribution that is rolled over is treated as consisting first of pre-tax amounts (contributions and earnings that would be includible in income if no rollover occurred). How can i file my 2012 taxes online This means that if you roll over an amount that is at least as much as the pre-tax portion of the distribution, you do not have to include any of the distribution in income. How can i file my 2012 taxes online Years of service for church employees and ministers. How can i file my 2012 taxes online   If you are a minister or church employee, treat all of your years of service as an employee of a church or a convention or association of churches as years of service with one employer. How can i file my 2012 taxes online Prior law required church employees and ministers to figure years of service separately for each employer. How can i file my 2012 taxes online   As a minister or church employee, all contributions made to 403(b) plans on your behalf, as an employee of a church or a convention or association of churches, are considered made by one employer. How can i file my 2012 taxes online Foreign missionaries. How can i file my 2012 taxes online   If you are a foreign missionary, contributions to your 403(b) account will not be treated as exceeding the limit on annual additions if the contributions are not more than the greater of: $3,000, or Your includible compensation. How can i file my 2012 taxes online More information. How can i file my 2012 taxes online   For more information about 403(b) plans, see Publication 571, Tax-Sheltered Annuity Plans (403(b) Plans). How can i file my 2012 taxes online Later Change Deemed IRAs For plan years beginning after 2002, a qualified employer plan can provide for voluntary employee contributions to a separate account or annuity that is deemed to be an IRA. How can i file my 2012 taxes online For this purpose, a qualified employer plan includes a deferred compensation plan (section 457(b) plan) maintained by a state, a political subdivision of a state, or an agency or instrumentality of a state or political subdivision of a state. How can i file my 2012 taxes online The term qualified employer plan also includes: A qualified pension, profit-sharing, or stock bonus plan (section 401(a) plan), A qualified employee annuity plan (section 403(a) plan), and A tax-sheltered annuity plan (section 403(b) plan). How can i file my 2012 taxes online More information about IRAs can be found in Publication 590, Individual Retirement Arrangements (IRAs). How can i file my 2012 taxes online Prev  Up  Next   Home   More Online Publications
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Deducting Business Expenses

Business expenses are the cost of carrying on a trade or business. These expenses are usually deductible if the business is operated to make a profit.

What Can I Deduct?

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. An expense does not have to be indispensable to be considered necessary.

It is important to separate business expenses from the following expenses:

  • The expenses used to figure the cost of goods sold,
  • Capital Expenses, and
  • Personal Expenses.

Cost of Goods Sold

If your business manufactures products or purchases them for resale, you generally must value inventory at the beginning and end of each tax year to determine your cost of goods sold. Some of your expenses may be included in figuring the cost of goods sold. Cost of goods sold is deducted from your gross receipts to figure your gross profit for the year. If you include an expense in the cost of goods sold, you cannot deduct it again as a business expense.

The following are types of expenses that go into figuring the cost of goods sold.

  • The cost of products or raw materials, including freight
  • Storage
  • Direct labor costs (including contributions to pensions or annuity plans) for workers who produce the products
  • Factory overhead

Under the uniform capitalization rules, you must capitalize the direct costs and part of the indirect costs for certain production or resale activities. Indirect costs include rent, interest, taxes, storage, purchasing, processing, repackaging, handling, and administrative costs.

This rule does not apply to personal property you acquire for resale if your average annual gross receipts (or those of your predecessor) for the preceding 3 tax years are not more than $10 million.

For additional information, refer to the chapter on Cost of Goods Sold, Publication 334, Tax Guide for Small Businesses and the chapter on Inventories, Publication 538, Accounting Periods and Methods.

Capital Expenses

You must capitalize, rather than deduct, some costs. These costs are a part of your investment in your business and are called capital expenses. Capital expenses are considered assets in your business. There are, in general, three types of costs you capitalize.

  • Business start-up cost (See the note below)
  • Business assets
  • Improvements

Note: You can elect to deduct or amortize certain business start-up costs. Refer to chapters 7 and 8 of Publication 535, Business Expenses.

Personal versus Business Expenses

Generally, you cannot deduct personal, living, or family expenses. However, if you have an expense for something that is used partly for business and partly for personal purposes, divide the total cost between the business and personal parts. You can deduct the business part.

For example, if you borrow money and use 70% of it for business and the other 30% for a family vacation, you can deduct 70% of the interest as a business expense. The remaining 30% is personal interest and is not deductible. Refer to chapter 4 of Publication 535, Business Expenses, for information on deducting interest and the allocation rules.

Business Use of Your Home

If you use part of your home for business, you may be able to deduct expenses for the business use of your home. These expenses may include mortgage interest, insurance, utilities, repairs, and depreciation. Refer to Home Office Deduction and Publication 587, Business Use of Your Home, for more information.

Business Use of Your Car

If you use your car in your business, you can deduct car expenses. If you use your car for both business and personal purposes, you must divide your expenses based on actual mileage. Refer to Publication 463, Travel, Entertainment, Gift, and Car Expenses. For a list of current and prior year mileage rates see the Standard Mileage Rates.

Other Types of Business Expenses

  • Employees' Pay - You can generally deduct the pay you give your employees for the services they perform for your business.
  • Retirement Plans - Retirement plans are savings plans that offer you tax advantages to set aside money for your own, and your employees' retirement.
  • Rent Expense - Rent is any amount you pay for the use of property you do not own. In general, you can deduct rent as an expense only if the rent is for property you use in your trade or business. If you have or will receive equity in or title to the property, the rent is not deductible.
  • Interest - Business interest expense is an amount charged for the use of money you borrowed for business activities.
  • Taxes - You can deduct various federal, state, local, and foreign taxes directly attributable to your trade or business as business expenses.
  • Insurance - Generally, you can deduct the ordinary and necessary cost of insurance as a business expense, if it is for your trade, business, or profession.

This list is not all inclusive of the types of business expenses that you can deduct. For additional information, refer to Publication 535, Business Expenses.

Page Last Reviewed or Updated: 04-Feb-2014

The How Can I File My 2012 Taxes Online

How can i file my 2012 taxes online Index Symbols 1099-C, Persons who each receive a Form 1099-C showing the full amount of debt. How can i file my 2012 taxes online 501(c)(3) organizations, Section 501(c)(3) organization. How can i file my 2012 taxes online A Abandonments, Abandonments Canceled debt, Canceled debt. How can i file my 2012 taxes online Assistance (see Tax help) B Bankruptcy, Bankruptcy Reduction of tax attributes, Bankruptcy and Insolvency Business Real property indebtedness, Qualified Real Property Business Indebtedness C Canceled debt, Canceled Debts, Persons who each receive a Form 1099-C showing the full amount of debt. How can i file my 2012 taxes online Exceptions Deductible debt, Deductible Debt Gifts, Gifts, Bequests, Devises, and Inheritances Price reduced after purchase, Price Reduced After Purchase Student loans, Student Loans Exclusions Bankruptcy, Bankruptcy Insolvency, Insolvency Qualified farm indebtedness, Qualified Farm Indebtedness Qualified principal residence indebtedness, Qualified Principal Residence Indebtedness Qualified real property business indebtedness, Qualified Real Property Business Indebtedness Co-owners, Persons who each receive a Form 1099-C showing the full amount of debt. How can i file my 2012 taxes online D Debts Stockholder's, Stockholder debt Definitions Adjusted tax attributes, Adjusted tax attributes. How can i file my 2012 taxes online Main home, Main home. How can i file my 2012 taxes online Qualified acquisition indebtedness, Definition of qualified acquisition indebtedness. How can i file my 2012 taxes online Qualified farm indebtedness, Qualified Farm Indebtedness Qualified principal residence indebtedness, Qualified Principal Residence Indebtedness Qualified real property business indebtedness, Qualified Real Property Business Indebtedness E Educational loans, Student Loans Exceptions Home Affordable Modification Program, Home Affordable Modification Program F Farm indebtedness, Qualified Farm Indebtedness Reduction of tax attributes, Qualified Farm Indebtedness Foreclosures, Foreclosures and Repossessions Form 1099-A, Forms 1099-A and 1099-C. How can i file my 2012 taxes online , Forms 1099-A and 1099-C. How can i file my 2012 taxes online 1099-C, Forms 1099-A and 1099-C. How can i file my 2012 taxes online , Forms 1099-A and 1099-C. How can i file my 2012 taxes online Free tax services, Free help with your tax return. How can i file my 2012 taxes online G Gifts, Gifts, Bequests, Devises, and Inheritances H Help (see Tax help) Home Affordable Modification Program, Home Affordable Modification Program I Income from, Canceled Debts Income from canceled debt, Canceled Debts Insolvency, Insolvency Reduction of tax attributes, Bankruptcy and Insolvency L Limits Excluded farm debt, Exclusion limit. How can i file my 2012 taxes online Excluded principal residence indebtedness, Exclusion limit. How can i file my 2012 taxes online Qualified real property business indebtedness, Exclusion limit. How can i file my 2012 taxes online Loans Student, Student Loans M Missing children, photographs of, Reminder Mortgage Debt Relief Act (see Qualified Principal Residence Indebtedness) P Principal residence indebtedness, Qualified Principal Residence Indebtedness Publications (see Tax help) Q Qualified farm indebtedness, Qualified Farm Indebtedness Reduction of tax attributes, Qualified Farm Indebtedness Qualified principal residence indebtedness, Qualified Principal Residence Indebtedness Reduction of tax attributes, Qualified Principal Residence Indebtedness Qualified real property business indebtedness, Qualified Real Property Business Indebtedness Reduction of tax attributes, Qualified Real Property Business Indebtedness R Real property business indebtedness, Qualified Real Property Business Indebtedness Recapture Basis reductions, Recapture of basis reductions. How can i file my 2012 taxes online Repossessions, Foreclosures and Repossessions S Stockholder debts, Stockholder debt Student loans, Student Loans Suggestions for publication, Comments and suggestions. How can i file my 2012 taxes online T Tax attributes, reduction of Bankruptcy, Bankruptcy and Insolvency Insolvency, Bankruptcy and Insolvency Qualified farm indebtedness, Qualified Farm Indebtedness Qualified principal residence indebtedness, Qualified Principal Residence Indebtedness Qualified real property business indebtedness, Qualified Real Property Business Indebtedness Tax help, How To Get Tax Help TTY/TDD information, How To Get Tax Help Prev  Up     Home   More Online Publications