Home Business Informer

I do not receive any deduction, right? Generally speaking, yes. The mantra of small business accounting consideration has been relentless for decades: "No receipt, no deduction."

My clients own taxes are quick to remind me of this basic registration rule. Over the years I heard this countless times: "But I have no receipt. I guess I can not take the deduction, right?"

What is my response to "no receipt, no deduction's lament? "Not so fast! Whenever there is a tax rule, one exception to the rule."

In certain situations, to take deductions without a receipt is actually sanctioned by the IRS. Here are three statutory exceptions to the "no receipt, the State not recoverable".

Exception # 1: Cost of Vehicles

You are allowed to deduct your vehicle expenses to the extent that you use your vehicle for business. If you took your car 100% for business, then 100% of your vehicle expenses are deductible.

And you have two options for the determination of the costs of vehicles:

1) The actual expense method
2) The method of Miles

We revolve around the choice # 2 – because the method of their own vehicles Miles is simply the number of business miles times the official IRS mileage rate.

To 2009, this rate is 55 cents per mile. In 2009, when he drove 10,000 miles for business, you can report a deduction of $ 5,500 – without keep all receipts for gasoline, oil changes, repairs and maintenance, insurance, etc.

You have to document your business miles by a record writing of some kind, but this is much easier than saving all receipts for actual vehicle expenses.

Meals Exception # 2: while is away

When traveling out of town on a business trip during the night, you can deduct the actual cost of meals (for keeping the receipt) or you can rely on the little-known "Per Diem Method '(which requires no reception).

Diets method gives a subsidy of food daily for each day of travel, depending on what part of the country you visit. For example, the rate of per diem for meals Birmingham, AL is $ 44, for San Francisco, which is $ 64 (as of 9/30/08).

To find the amounts of allowances for each state, go to: irs.gov/publications/p1542/ar02.html

Exception # 3: The dollar Article $ 75

Here's another easy way to avoid the hassle of having to keep receipts – this means your food business and entertainment. Believe it or not, the IRS does not require a receipt when your business meal or entertainment expense is less than $ 75 for expenses.

Sounds too good to be true? Well, a "catch" of course: You must keep a record of the following five facts about the case of deductible:

1) Who did you eat with or entertain? ie names of people and nature of its business relationship with you
2) When entertainment began to happen? ie the date
3) When there is entertainment? ie the name of the restaurant or other place of
4) Why meet? ie a description of the commercial purpose of the meal or event
5) How much do they spend? ie the amount of dollars

You must record these five events in a log. Your daily agenda or day timer is the perfect place to write this down in less than a minute. Having met the requirements of substantiation IRS, you can throw the receipt. In the case of an audit, you will be covered.

Two final comments: Exception # 2 applies to travel situations at night, whether meals are eaten alone or with business partners. Exception # 3 applies to meals and entertainment expenses incurred when you someone with whom you have an existing or potential business relationship, whether you're in town or on travel status overnight.

Wayne M. Davies is author of 3 ebooks on small business tax reduction strategies. For a free copy of his Special Report “How To Instantly Double Your Deductions”, visit http://www.YouSaveOnTaxes.com.

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