Author Topic: People that use tax deductions to justify expenses?  (Read 3026 times)

Gone Fishing

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People that use tax deductions to justify expenses?
« on: November 05, 2014, 11:55:17 AM »
Never have really understood this one.  I guess housing/mortgage debt is a prime example, but business owners seem to throw it out there out pretty often, too.  Personally, I'd much rather have the money, taxes or not.  What's really beautiful is when your itemized deductions are lower than the standard deduction and you get to deduct expenses that you didn't even pay!

usmarine1975

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Re: People that use tax deductions to justify expenses?
« Reply #1 on: November 05, 2014, 11:58:40 AM »
I look at it this way.  If it's something I would purchase anyway the tax deduction is worth taking.  If I don't need it I would like you rather keep the money.  Some Accountants will recommend that a business buy something simply because for them it's the easiest way to show value to their client.  Not that I buy that whole bit, and not that all accountants do that.

bigalsmith101

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Re: People that use tax deductions to justify expenses?
« Reply #2 on: November 05, 2014, 05:34:03 PM »
  What's really beautiful is when your itemized deductions are lower than the standard deduction and you get to deduct expenses that you didn't even pay!

THIS is my FAVORITE thing. I regularly work contracts where I pay sizeable fuel expenses, but regularly achieve much lower fuel mileage than the standard deduction, resulting in a significant reduction on my tax liability. Also, standard deductions for food/accomodation are much higher than my mustachian need for food and a bed. Depending on my work load, this can result in complete tax brackets being avoided simply due to being frugal in spite of the deductions. BOOM!

fireferrets

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Re: People that use tax deductions to justify expenses?
« Reply #3 on: November 24, 2014, 02:36:26 PM »
Ugh - friends who are "thinking about buying a house for the tax deductions". They simply don't understand that their pockets are emptier than if the had simply kept renting a home.

I have heard that some people that work from home will deduct their entire rent as "office space" in their taxes. Not sure if completely illegal or just borderline. (-,-); Either way- definitely unethical.

Sibley

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Re: People that use tax deductions to justify expenses?
« Reply #4 on: February 11, 2015, 01:54:36 PM »
Ugh - friends who are "thinking about buying a house for the tax deductions". They simply don't understand that their pockets are emptier than if the had simply kept renting a home.

I have heard that some people that work from home will deduct their entire rent as "office space" in their taxes. Not sure if completely illegal or just borderline. (-,-); Either way- definitely unethical.

Illegal. No question. Home office deduction is pretty strict.