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How to Avoid a Small Business Write Off Audit


A small business write off should be done in the right manner so that you're not left to deal with audit problems at a later stage. You must write off your deductibles appropriately so that you don't face issues with the IRS. Deductions that are made for travel expenses, phone bills and home offices are carefully scrutinized by the IRS. Not all travel expenses can be written off when you file taxes. You must therefore carefully read the IRS rules so that you know what you're entitled to write off.

Travel Expenses and Phone Bills

If you want to deduct travel expenses that were incurred by professionals who were involved in your business, you will have to make sure that the trip was a business trip. The IRS allows you to deduct only 50 percent of the expenses that were incurred on food and entertainment on the business trip. Similarly you can't claim phone bills when you file taxes if you used your business phone for personal calls. To avoid a write off audit, attach a copy of your itemized cell phone bill when you file your taxes and only make claims for business calls.  

Home Office Deductions

In addition to this, you must be very careful when you make home office deductions. This deduction has been misused by people in the past which is why this item is scrutinized by the IRS. To play it safe, get a professional to measure your home office space. Attach a letter that states the amount of space you use for your home office so that you don't face any problems.

To avoid audits, it's best that you get someone to file your taxes for you. But if you don't want to pay someone to do it for you, make sure you read the IRS rules by visiting the website so that you know you're in legal compliance.

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