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Taxes Category

Melissa78

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May 10, 2009
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What category of expenses do Consultant Gifts fall under?
 

Jolie_Paradoxe

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Apr 15, 2009
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My tax rep said you can only gift $35 per person. She filed a couple of them under advertising, and then created a category listing it as Product Sample Distribution.

Hope that helps.
 

esavvymom

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Sep 8, 2008
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Melissa- I know I posted something for someone else about this- but for the life of me, I can't find the thread. I do however have my notes that my DH and I worked up so I can have this straight for NEXT year. :)

Gifts/Consultant Gifts are reported on the Schedule C- line 27 (other) per the IRS Publication 463- chapter 6-page 28 (2009 Tax year edition). (You can find the publication on the irs.gov website- just search for 'pub 463'). The other "rule" I know is that you can only give $25 in gifts per PERSON/recipient per year. I believe this was also in the same publication 463. For example, you can only "gift" to your mom up to $25 for the whole year.

Hope that helps!
 

Jolie_Paradoxe

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Apr 15, 2009
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ooh, that's scary. My H&R block rep told me $35. Guess it didn't matter since she listed them differently (Advertising & Sample Distribution).
 

esavvymom

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Sep 8, 2008
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ooh, that's scary. My H&R block rep told me $35. Guess it didn't matter since she listed them differently (Advertising & Sample Distribution).

Yeah...that is scary. I just checked my Pub463 that I still have on my computer. It has the "$25 Limit" in bold right at the beginning of the section devoted to "Gifts". It's in Chapter 3 - page 13 of the 2009 Pub 463. But yes, unless you got audited, they probably wouldn't even notice since it's under advertising. But now you can tell them next year! ;)

We got tired of telling our H&R reps how to do our taxes (they couldn't even do standard deductions- or weren't ASKING us if we had them....like "do you own a home, pay property taxes", etc. ) we started doing our own....and my DH is notorious for looking at tax publications/codes. :) I did this year because he and I got into such a big argument about my biz expenses. *hehe*
 

Jolie_Paradoxe

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Apr 15, 2009
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I agree Bobbi. I spent 5 hours there, correcting and suggesting. In fact, she did not allow me to list my cell phone as a deduction since I received personal calls too. Once we hit negative, she told me we could stop inputting even though we hadn't even entered mileage! She argued with me about home office space, and kept making typos. At one point, she said...good thing you're watching!

I always do my taxes too, but the hubby wanted a "professional" to do it since it was my 1st year with a biz. I did get them to file it for $60 and paid an additional $30 to cover any difference owed due to mistakes. I'll be filing my own taxes, and probably asking YOU all the questions! ha ha

I did get a cooking show out of it, so I suppose it was worth it! ha ha
 

esavvymom

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Sep 8, 2008
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I agree Bobbi. I spent 5 hours there, correcting and suggesting. In fact, she did not allow me to list my cell phone as a deduction since I received personal calls too. Once we hit negative, she told me we could stop inputting even though we hadn't even entered mileage! She argued with me about home office space, and kept making typos. At one point, she said...good thing you're watching!

I always do my taxes too, but the hubby wanted a "professional" to do it since it was my 1st year with a biz. I did get them to file it for $60 and paid an additional $30 to cover any difference owed due to mistakes. I'll be filing my own taxes, and probably asking YOU all the questions! ha ha

I did get a cooking show out of it, so I suppose it was worth it! ha ha

At least you can claim those expenses NEXT year on your taxes. You can claim purchasing software too if you do it on your own. I love TurboTax...rather hard to screw it up if you go through all of the questions. Did your DH go with you to the tax rep? If he saw how bad it was, maybe he'd change his mind. :) (And yes, I know not ALL of them are like that- so please don't chew me out...it's just been MY experience)
 

Jolie_Paradoxe

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Apr 15, 2009
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Sorry for the hijack Melissa. :D

Bobbi....turbotax rocks...that's what I've used in the past couple of years. My wonderful hubby did NOT come along, though I wish I had thought of that!:p

I was sure to give him a recap of the experience and process, and he saw that I deserved a good break. :thumbup: Next year, it's back to me preparing the taxes.
 

Melissa78

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May 10, 2009
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  • #9
Its ok Laurie. I do know the $25 is right b/c i read that this weekend. I need to do some "creative accounting" because I often buy things for myself but I list it as COnsultant Gift so that I remember it was for me and I surely know I almost always spent more than $25. I still don't understand what category I put it under on my excel spreadsheet which is based on the expense categories given by TT. Maybe I'm not far enough into TT to figure it out. I'm still in the pen/paper stage with my spreadsheets. 2 days right???? 2 days.... *deep breath*
 

tys1031

Member
Nov 3, 2009
254
0
  • #10
Its ok Laurie. I do know the $25 is right b/c i read that this weekend. I need to do some "creative accounting" because I often buy things for myself but I list it as COnsultant Gift so that I remember it was for me and I surely know I almost always spent more than $25. I still don't understand what category I put it under on my excel spreadsheet which is based on the expense categories given by TT. Maybe I'm not far enough into TT to figure it out. I'm still in the pen/paper stage with my spreadsheets. 2 days right???? 2 days.... *deep breath*

Whatever you buy for yourself, can be claimed as business supplies if you have used them at your shows. I'm an accountant by trade (soon-to-be CPA). Feel free to PM me if you need help with where to classify things!
 

Melissa78

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May 10, 2009
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Whatever you buy for yourself, can be claimed as business supplies if you have used them at your shows. I'm an accountant by trade (soon-to-be CPA). Feel free to PM me if you need help with where to classify things!

Can I jump thru the screen and hug you? The category on TT is "Office Supplies" - is that the same category as biz supplies in the accounting world? (In my simple mind it is but there is nothing simple about the IRS)
 

tys1031

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Nov 3, 2009
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  • #12
Can I jump thru the screen and hug you? The category on TT is "Office Supplies" - is that the same category as biz supplies in the accounting world? (In my simple mind it is but there is nothing simple about the IRS)

:blushing: Yes it is. Since the kitchen is your "office" that would be the most appropriate category to use. If for some reason you got audited, you could explain to the IRS exactly that.....the kitchen is "my office."
 

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