2009 Tax Deductions
Here's a handy summary of popular tax deductions. Check with us to see which deductions apply to your situation.
Two methods are used to calculate automobile expenses for business use:
• Actual Expenses: Depreciation, licenses, repairs, gas, oil, tires, insurance, tolls, parking fees, lease fees, rental fees.
• Standard Mileage Rate: 50¢ per mile (2009). Certain expenses such as tolls and parking fees are deductible using the standard mileage rate or under actual expenses.
To substantiate auto deductions, a log should be kept to show where, why and whom you visited each day, as well as the number of miles driven.
Maximum Depreciation on
Automobiles, Trucks and Vans
| |
Placed In Service 2007 |
Placed In Service 2006 |
| |
Standard |
Trucks/Vans |
Standard |
Trucks/Vans |
| 1st year (regular) |
$3,060*** |
$3,260 |
$2,960 |
$3,260 |
| 2nd year |
$4,900 |
$5,200 |
$4,800 |
$5,200 |
| 3rd year |
$2,850 |
$3,050 |
$2,850 |
$3,150 |
| 4th year + |
$1,775 |
$1,875 |
$1,775 |
$1,875 |
* Vehicles defined as having GVW under 6,000 lbs. Automobiles use unloaded GVW; trucks use loaded. Vehicles heavier than 6,000 lbs. are not subject to these limits.
** Refers only to trucks, vans or SUVs built on a truck chassis.
*** Note: This amount jumps to $11,060 in 2008 as a result of the Economic Stimulus Act of 2008.
Business Trips, Conventions, Meetings
Within the USA
| 0% Deductible |
50% Deductible |
100% Deductible |
| Lavish or extravagant expenses |
Meals and entertainment (75 percent deductible for transport workers, subject to Department of Transportation hours-of-service limitations.) |
Hotel, transportation expenses |
| Luxury water travel (cost in excess of twice the federal per diem rate, subject to certain exceptions) |
Tips for meals and entertainment |
Cleaning and laundry |
| |
Business luncheons at clubs |
Cost of meeting rooms |
| |
|
Registration fees |
| |
|
Tips (other than for meals and entertainment) |
Proper documentation includes records of who, what, where, how much, and business relationships. Receipt required for expenses $75 or more.
| 0% Deductible |
50% Deductible |
100% Deductible |
| Business gifts in excess of $25 per person per year |
Restaurant meals - requires a member of your business to be present |
Cost of travel to entertainment events |
| Lavish or extravagant expenses |
Night clubs, social events, sporting events, theater, sporting trips, etc. |
Entertainment and meal expenses billed to customer, if record provided to customer |
| Cost of entertainment facilities |
Food at any of the above events |
Holiday cards and decorations |
| Facility operating costs |
Tips for meals and entertainment (Note: All entertainment requires active business discussion before, during or after the entertainment event.) |
Food provided to the general public (in nature of advertising) |
| Skyboxes - cost in excess of regular non-luxury box seat |
|
Business gifts costing less than $25 per person per year |
| 0% Deductible |
50% Deductible |
100% Deductible |
| |
Meals provided in employer sponsored eating facility (if 50 percent or fewer employees meet the convenience-of-employer test) |
Meals and entertainment included in employee's compensation |
| |
|
Meals and entertainment included in Form 1099 for non-employees |
| |
|
Recreational expenses for non highly compensated employees |
| |
|
Employee holiday parties, annual picnic, sports teams and expenses |
| |
|
Cash gifts to employees required to be included in compensation |
| |
|
Non-cash gifts to employees - value in excess of $25 - required to be included in compensation (exception for employee award programs) |
| |
|
Meals provided in employer sponsored eating facility (if more than 50 percent of employees meet the convenience-of-employer test) |
|
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