Our long-time tax contributor Julian Block regularly receives commentary about his posts, as well as a multitude of emails from other practitioners. Here he has compiled a list of Q&As around many of the latest tax-related issues from other practitioners and business owners.
We hope you find it informative and, as ever, feel free to add your own comments and questions to this as well.
I’ve received emails from accountants on how to craft responses to questions from clients. I’ve edited and condensed the questions for clarity and brevity. – Julian Block
Q. I’m a self-employed freelance writer. During 2017, I traveled from my New York home to Chicago to attend a writers’ conference. I’m pretty sure that I’m entitled to claim some deductions on Schedule C. But what sorts of expenses am I allowed to deduct, and can I deduct them totally?
A. You get to deduct 100 percent of what you spend for the attendance fee, tapes of sessions and the like, plus travel between your home and Chicago, and expenditures for hotels. There’s a limitation, though, for meals not covered by the attendance fee, including both what you eat en route and food consumed while you’re in Chicago: Deduct only 50 percent of those expenditures.
Q. I was accompanied on the trip by my spouse, who isn’t a writer and didn’t attend the conference. Any chance that any of my spouse’s expenses qualify as deductible?
A. There’s no deduction whatever for the portion of the outlays attributable to your spouse's travel, meals and lodging—with a limited exception, one that will allow relatively few freelancers to salvage deductions for a mate's travel expenses. To qualify for the exception, these three requirements must be met: (1) the spouse (or dependent, or any other individual) accompanying you on business travel is a bona fide employee of the outfit that pays for the trip (in this case, your freelance business); (2) the spouse undertakes the travel for a bona fide business reason; and (3) the spouse is otherwise entitled to deduct the expenses.
Some often-overlooked tax relief remains available for lodging costs even when your spouse, significant squeeze or someone else tags along only for fun. You’re entitled to a deduction for lodging based on the single-rate cost of similar accommodations for you—not half the double rate you actually paid for the two of you.
To illustrate, Judy Peterson, a photographer, goes by car to Boston for a business conference. She is accompanied by her husband, Frank, who is retired. They stay at a hotel where rooms go for $300 for a double and $200 for a single. Besides a deduction for the total cost of driving to and from Boston (Judy obviously incurs the same driving expenses whether Frank accompanies her or not), she should claim a per-day deduction of $200, rather than $150, half the double rate.
To help safeguard her deduction in case the IRS questions it, she should remember to have the hotel bill note the single rate, or be sure to get hold of a rate sheet.
Q. I’m a business owner who finds it difficult to keep track of all the federal deadlines for filing returns and sending in quarterly estimated tax payments. What kind of help does the IRS provide?
A. Go to irs.gov and download IRS Publication 509, “Tax Calendars.” For a list of all the agency’s publications, get Publication 910, “Guide to Free Tax Services.”
Additional articles. A reminder for accountants who would welcome advice on how to alert clients to tactics that trim taxes for this year and even give a head start for next year: Delve into the archive of my articles (more than 250 and counting).
About Julian Block
Attorney and author Julian Block is frequently quoted in the New York Times, Wall Street Journal, and the Washington Post. He has been cited as “a leading tax professional” (New York Times), an “accomplished writer on taxes” (Wall Street Journal), and “an authority on tax planning” (Financial Planning magazine). More information about his books can be found at julianblocktaxexpert.com.