One factor nobody is addressing is TIMING. Yes, mathematically it might work out similar in some cases, but getting reimbursed now vs. getting a tax deduction later is a huge cash flow advantage. Think about it - you get the $67 in your next check with reimbursement. With a deduction, you might wait 3-15 months to see that tax benefit, depending on when you file. Plus, the benefit is spread across your tax refund or reduced liability. For a contractor with lots of miles, this timing difference can be thousands of dollars in your pocket NOW vs. later.

Something I haven't seen mentioned yet is the impact on self-employment taxes. When you receive mileage reimbursement that gets reported as income on your Schedule C, it increases your self-employment tax liability (Social Security and Medicare taxes). However, when you deduct the mileage expense on the same Schedule C, it reduces your self-employment income by the same amount. So like others said, it's a wash for income tax purposes, but more importantly it's also a wash for self-employment tax. If you WEREN'T reimbursed and just took the deduction, you'd save on both income tax AND self-employment tax on that deduction amount. This is actually a small advantage to not being reimbursed, though the cash flow benefit of getting paid upfront usually outweighs this. The key is making sure your reimbursement rate matches the IRS standard rate ($0.67/mile for 2024). If your client pays less than the standard rate, you can deduct the difference!

Anyone know if TurboTax handles this consolidation automatically? I've got about 50 trades this year and don't want to pay for the premium version if it can't handle this correctly.

This is great advice from everyone here. I just want to add one more thing that caught me off guard last year - make sure your broker statements match what you're reporting on Form 8949 even when consolidating. I consolidated all my Microsoft trades into one line, but my broker's 1099-B showed each trade separately. When I filed, the IRS computer flagged the discrepancy because their automated system couldn't match my consolidated reporting to the individual 1099-Bs they received from my broker. It wasn't a big deal - just had to mail in a reconciliation statement explaining the consolidation - but it delayed my refund by about 6 weeks. So heads up that even though consolidation is allowed, it might trigger some additional correspondence with the IRS if your broker reports differ significantly from your filing format. Still totally worth doing consolidation though! Just be prepared for potential follow-up questions.

As someone who works in the entertainment industry (background acting and some commercial work), I've dealt with similar questions about appearance-related deductions. One thing that hasn't been mentioned yet is the "but for" test - would you have gotten the veneers "but for" your modeling work? Since your agent specifically recommended this and you have documentation showing increased bookings, that's a strong argument for business necessity. I'd also suggest keeping track of any maintenance costs for the veneers that are specifically related to your modeling work - like touch-ups before big shoots or cleaning appointments timed around bookings. These ongoing costs might be easier to defend as pure business expenses. Another angle to consider: some models I know have had success writing off a percentage based on the proportion of their income from modeling versus other sources. So if 60% of your income comes from modeling, you might be able to justify deducting 60% of the veneers cost. The documentation you have sounds solid - agent emails and booking rate increases are exactly what you'd need if questioned. Just make sure you have clear records of your income before and after the procedure to quantify that business impact.

I work as a tax advisor and have dealt with several cases involving appearance-related deductions for models and actors. While this is definitely a gray area, you actually have some strong documentation that could support your case. The key factors working in your favor are: 1) Your agent's specific recommendation (this is crucial evidence), 2) The measurable increase in bookings after the procedure, and 3) The direct connection between your appearance and income in modeling. However, be prepared for potential IRS scrutiny. Cosmetic dental work is often viewed as having significant personal benefit since you retain the improved appearance 24/7. To strengthen your position, I'd recommend: - Documenting the exact percentage increase in your modeling income post-veneers - Keeping all communications from your agent about this recommendation - Consider deducting only the portion that's proportional to your modeling income vs. total income Given that this is a substantial expense ($10,500) and potentially audit-triggering, I'd strongly suggest consulting with a tax professional who has experience with entertainment industry deductions before filing. They can help you present the strongest possible case and ensure you're following all the proper documentation requirements. The good news is that with your level of documentation, this isn't automatically disallowed - it just needs to be handled carefully and professionally.

Great question! You're absolutely right that donating appreciated securities directly to charity is one of the best tax strategies available. Just want to add a few practical tips from my experience: 1. Make sure to get a written acknowledgment from the charity that specifically states they received securities (not just cash), includes the date of transfer, and describes the securities donated. This is crucial for your tax records. 2. If you're donating a large amount, consider spreading it across multiple tax years to stay within the 30% AGI limitation for appreciated property donations. You can carry forward unused deductions for up to 5 years. 3. Consider donating your most highly appreciated shares first - the ones with the lowest cost basis give you the biggest tax benefit since you're avoiding the most capital gains tax. 4. Time the donation strategically if you're close to year-end. The deduction counts for the tax year when the charity receives the shares, not when you initiate the transfer. With your cost basis being only 30% of current value, you're looking at substantial tax savings. This strategy could save you thousands in capital gains taxes while maximizing your charitable impact!

This is exactly the situation I was in last year with some Berkshire Hathaway shares I'd held since 2005! The strategy worked perfectly - I donated shares worth about $50k with a cost basis of only $12k directly to my local food bank. A few things I learned that might help you: 1. Contact the charity first to make sure they can accept stock donations. Many smaller organizations aren't set up for this, but most established charities have procedures in place. 2. Your broker will need the charity's DTC number and account details. The charity should be able to provide this quickly if they're equipped to handle stock donations. 3. Keep detailed records of the transfer date, number of shares, and the stock price on that date. You'll need this for Form 8283 if your donation is over $500. 4. The fair market value is calculated as the average of the high and low trading prices on the date the charity receives the shares. In my case, I avoided about $5,700 in capital gains taxes (15% on the $38k gain) and got to deduct the full $50k market value. The food bank was thrilled because they received the full value instead of what would have been left after I paid capital gains tax on a sale. Definitely one of the most tax-efficient moves I've made!

Don't forget about the Real Estate Professional status if you spend significant time managing your properties! If you qualify (750+ hours annually in real estate activities and more than half your working time), your real estate losses are no longer subject to the passive loss limitations. This means you could potentially deduct ALL of your losses against other income with no $25k limit or phase-out based on income. This has been a game-changer for my tax situation with my real estate LLC. Just make sure you keep EXTREMELY detailed time logs if you claim this status - the IRS scrutinizes these claims heavily.

Great question! I went through something very similar last year with my rental property LLC. One important thing to add to the excellent advice already given - make sure you're categorizing your $27,500 in repairs correctly between repairs vs. improvements. Regular repairs (like fixing plumbing issues) are fully deductible in the year incurred, but major improvements (like a new roof or HVAC system) typically need to be depreciated over time. The new roof and HVAC might be considered improvements that get depreciated over 27.5 years for residential rental property. However, there are some exceptions - if these were necessary to bring the property up to rentable condition when you first acquired it, they might be treated differently. Also, look into the "safe harbor" rules for small taxpayers - if your average annual gross receipts are $27 million or less (which applies to most individual investors), you might be able to deduct up to $10,000 per building in improvements. Since you're planning to use TurboTax, it should help guide you through these distinctions, but it's worth understanding the difference before you start. Consider keeping detailed records of what exactly was done and why - this documentation could be crucial if you're ever audited.