L.L.C./Insurance/Tax Deductable Expenses

General Real Estate Investing
1

Hello to all that review this post, I have a question concerning general liability insurance and tax deductions. My question is can an investor claim the payment of commercial general liability insurance as a tax-deductible expense for the operating of an L.L.C.? What other tax-deductions is an investor that specializes in acquiring, fixing and selling properties entitled to claim when filing taxes?

2

the business is taxed on income. income is defined as revenue minus expenses.

any and all expenses involved in running your business and generating revenue are deductible.

insurance, telephone, vehicle mileage, business meals and entertainment, sub contractors, signs, business cards, pens and pencils, postage, letterhead, new tools, bank charges, credit card fees and interest, accounting and taxes, nails, lumber, finder’s fees, day laborers, door keys, PO Box rent…

you get the idea.

3

mcwagner is ther a limit to amount of deductions such as meals, entmnt, you can spend on a particular deduction. Or is there a standard deduction for expenses incuured?

Thanks

    Phil
4

no standard deduction; expenses are bona-fide cash-out-the-door spending.

meals and entertainment expenses are not “limited,” but only 50% is deductible. You should keep receipts, noting who was entertained, the business purpose, etc. If you have a lot of entertainment expenses related to how much business you do, you can expect a letter asking for explanation.

Note that this is meals/entertainment for others. Meals you provide to employees, company parties, marketing events (breakfast referral clubs) etc are fully deductible.

5

Thanks

6

Gee Phil, you look a lot like that Jim Cramer guy…

:wink:

Keith

7

I’m truely not that far off. 8)

8

Thanks for the information McWagner.