| Income tax deductions for direct sales?

Income tax deductions for direct sales?

Kim asked:

I am starting a direct sales (gourmet food sold in a home-party atmosphere as well as internet re-sales). What are some things that I should keep track of to write off at tax time?

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2 Responses to “Income tax deductions for direct sales?”

  1. v b on June 15th, 2009 8:00 pm

    Get IRS publication 334 and 535 and start reading. There is nothing special about this being direct sales.

    You *may* be able to deduct entertainment expenses, but only if you a) make sales at the same time and b) keep a list of the people you had in attendance.

    Do not plan on any deduction for your computer, home office, utilities, etc.

  2. SteveCPA on June 15th, 2009 11:30 pm

    Any time you spend money to make money, you should keep track of what you spent. If you make any expenditures to promote your business or to close a sale, the best thing you can do is record the expenditure, make a note of the business reason you spent money, and file a receipt away as support. Log your business miles, too.