| The Internal Revenue Service (IRS) reports, home | | | | Claiming a home business tax deduction for education |
| based business tax deduction scams have increased | | | | expenses from the salary you wrongfully paid to your |
| in popularity in recent years. Notably, in a consumer | | | | children by calling them an employee (double |
| alert, the IRS warned that regardless of how | | | | whammy); |
| convincing claims made by unscrupulous marketers of | | | | Deducting personal furniture, home entertainment |
| bogus home based business schemes may appear, | | | | equipment, children's toys, and other household items |
| nondeductible personal living expenses cannot be | | | | (That 62" plasma HDTV is not a home business tax |
| magically transformed into home business tax | | | | deduction); |
| deductions. This means that envelope stuffing at a | | | | The deduction of personal travel, meals, and |
| kitchen table does NOT qualify for a deduction for a | | | | entertainment under the guise that "everyone is a |
| home office, travel or entertainment. | | | | potential client." Many Multi Level Marketing (MLM) |
| Be Aware: Creating or being a party to a bogus home | | | | promoters will tell you EVERYTHING is a deduction |
| based business or other scheme puts YOU, the | | | | because EVERYONE is a prospect. NOT. That won't |
| taxpayer on a slippery slope that will result in you | | | | fly with the IRS. |
| paying interest and penalties on top of the taxes you | | | | You will find many home business tax deductions |
| will owe as well. This will also increase the likelihood of | | | | schemes that claim you can convert a personal |
| an audit. You can't cheat for long and if the IRS feels | | | | expense into a business expense and that the IRS will |
| there was fraud in claiming unqualified home business | | | | allow it, just by calling it home business expense. Now I |
| tax deductions, they have FOREVER to attack your | | | | have to ask how this makes any sense at all. If you're |
| return and you! | | | | "in business," you can take a home based business tax |
| The IRS also reported that many personal expenses | | | | deduction. To be in business you have to have what is |
| that do not qualify for home business tax deductions | | | | called a "profit objective" that you can substantiate. |
| are wrongly claimed as business expenses in home | | | | This is not rocket science. |
| based business schemes. These are some of the | | | | Do you have a DBA? |
| most frequent: | | | | Do you have a business address? |
| Claiming a home based business tax deduction for the | | | | Do you have a business phone number? |
| cost and operation of a personal residence(your | | | | Do you have a business checking account? |
| home) is a no no. | | | | Do you even have a business card? |
| Deducting excessive car and truck expenses when | | | | You have to really be "in business" from your home. |
| the vehicle has been used for both business and | | | | Investigate and research anyone that is promoting a |
| personal use. (That $1800 Blaupunkt Stereo System | | | | home business to you, period. If in doubt, consult a tax |
| you put in the family van is not a legitimate home | | | | professional and save yourself from the expensive |
| business tax deduction); | | | | headaches that will surely come from the IRS if you |
| Paying children a salary for services, such as | | | | choose to become involved in a fraudulent home |
| answering telephones, washing your cars, or other | | | | business. Make sure that any claims of home based |
| tasks and then claiming these costs as home based | | | | business tax deductions you take are legal. |
| business tax deductions; | | | | |