Taxpayer asks:
Hey taxgirl, if I’m a freelancer, buy a desk/chair and try to deduct it is that like begging for an audit? Advice on what to deduct/not?
Taxgirl says:
First of all, I’m psyched! This was my first taxgirl question via twitter! How exciting!
And now for the answer! The short answer is yes, deduct away.
Working from home or freelancing is tough because you have to supply everything yourself – from furniture to computers to office supplies. You are also responsible for your own benefits, such as health insurance. But the good news is that because you have to spend money to make money, these things are deductible.
The easy way to get started with deductions is to walk through your day and take stock of all of your expenses – from post-it notes to train tickets. Ask yourself which of these expenses you would NOT be responsible for if you weren’t freelancing or working from home… You wouldn’t include meals, for example, because you have to eat, working or not. But you would include business cards, computers and the like. A good rule of thumb then, is to think about what is “ordinary” and “necessary” for you to operate your business (those are the terms that the IRS likes to use) and start your deduction list from that point.
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