Posted this in GD, but I was suggested to come here (probably a great idea).
At any rate, I am trying to reduce my tax burden as much as possible. I have a good accountant as far as I know, but this is the first year I've been 100% self-employed. I did not pay an estimate last year, so I am going to get hit with the full force of Uncle Sam, and am seeking to mitigate that as much as possible.
My wife and I's income break down as follows:
~$70k via my business which gives me a K-1 at years end
~$7k for my wife prior to her quitting part-time at a library
~$17k from rentals that I own
For deductions, I have the following:
~$20k in medical bills for my wife giving birth for our daughter
~$13k in utilities and the like for the rentals
~$13k in upgrades to both rental properties (roof & new furnaces w/ duct work - unsure if there are any credits for furnaces or whatnot)
~$6k in documented, charitable contributions
~$7k in interest payments on rental properties & house
~$5k in business expenses related to my job
Anything else I can mitigate or look into as a deduction to help me out?
Thanks!
Originally Posted By Handydave:
vehicle
home office
cell phones
ANYTHING used to do business
it's prorated if it isn't solely used for the business
There are a lot of things I use related to the business, but will that be deduced from the self-employment tax?
Originally Posted By SpaceGuy:
Originally Posted By Handydave:
vehicle
home office
cell phones
ANYTHING used to do business
it's prorated if it isn't solely used for the business
There are a lot of things I use related to the business, but will that be deduced from the self-employment tax?
Any expenses you have related to the partnership are known as UPE, unreimbursed partnership expenses. These expenses generally offset the income subject to self-employment tax. Do you have an agreement with the entity as it pertains to expenses?
I'd need to check the language. What should I be looking for in the agreement?
With regard to the rentals repairs can be deducted in the current year and capital improvements must be depreciated over time. Discuss with your CPA repairs vs improvements.
Grove
