Tax deductions/expenses question?
April 30th, 2010I often use sites like Elance to find support for my business, and some of the contractors are not US citizens and live outside the US. My accountant seems to feel I cannot count money spent through that tool as a business expense, of if I do it would not ‘hold up under audit’, but this seems strange to me since elance keeps a clear record of the money spent and where it is going. Can anyone give me any advice on this – either corroborating or contradicting what my accountant says? Thanks!
Replys
It is deductible. The expense is both reasonable and necessary for the conduct of your business.
Here is an IRS link which will give you more detailed, and easy to read, information on deducting business expenses:
http://www.irs.gov/publications/p535/ch01.html
Generally speaking, educational expenses are only deductible if paid to an accredited school, and only if you are taking classes to keep the job you already have. you may be able to deduct it as a misc. business expense, subject to a deduction equal to 2% of you AGI.
I guess it depends on what type of "support" info you are gathering. It looks like the site is a headhunter type site and am not aware of any way to legally deduct hiring expenses, except perhaps as an advertising expense.
Good luck!
jwishz is right
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