Small Business Tax

Section 179 vehicles should be a key part of your small business tax deduction strategies. Can Section 179 property fit in with your business tax strategies?

Let Business Management Daily help you get each and every rental property depreciation credit and business tax deduction you’re entitled to.

Q: My husband passed away last year. Now, I'm preparing to sell the house we've owned for 25 years. Can I still shelter $500,000 of the home-sale gain from taxes? I know that $500,000 is the joint-filers amount, but I think I read that I would still qualify? No name, Springfield, Ohio

Question: My wife and I operate separate self-employed businesses. This year, I expect to show a big profit, so I plan on buying new machinery and tools before Jan. 1 that I can expense. My wife's business is likely to show a loss. Will her loss reduce the amount I can claim under Section 179? If so, what can I do about it? — C.S., Rochester, N.Y.

Q: I've heard that food expenses will be deductible beginning next year. Will itemizing be required? O.D., New York

Q: I own real estate that I plan to sell to my son through an installment sale. My CPA says this can't be done because we're related parties. Is this true? D.R.T., St. Petersburg, Fla.

The new bankruptcy law that took effect Oct. 17, protects funds held in a qualified retirement plan from outside creditors. There's no limit on the amount you can shield from creditors.

Q: My daughter graduated from college, and she gave $500 to the Red Cross after the hurricane. She probably won't itemize deductions this year. Is there any way she can deduct this donation? B.K., Red Bank, N.J.

Q: I read somewhere that employees can now spend the money in their flexible spending account after Dec. 31. My employer hasn't given any notice about this. Is that extension automatic? S.M., Cincinnati

During an audit, chances are that you won't be able to produce all the receipts, bills or other pieces of written information you'll need to back up your claims, especially if the audit comes several years after the tax year in question.

Q: I've heard that I'd have to pay tax on a home sale if I don't use the profits to buy another home. I didn't think that's true. Am I correct? O.D., New York City

Q: I have two IRAs that I established years ago. One was started for deductible contributions when I was young; the other has nondeductible contributions. Now that I'm over age 591/2, I want to withdraw some of that money. Can I withdraw money only from the nondeductible IRA? R.R.S., Key Biscayne, Fla.