AboutMike Wellman Expertise I was a former Manager with Price Waterhouse, now PricewaterhouseCoopers, the largest accounting firm in the world. I have had clients in almost every industry and of every size.
I will only answer questions dealing with IRS problems such as delinquent tax returns, Offers in Compromise (Tax Settlement), IRS collection matters including installment agreements, liens, levies, seizures, audits, appeals, innocent spouse claims and injured spouse claims. All other will be referred to the question pool.
Experience Over 25 years experience in taxation specializing in IRS collections, examinations and appeals.
Publications New York Times, Wall Street Journal, Your Money.
Education/Credentials BBA, Baylor University.
Awards and Honors IRSOS.com won the Knowledgeweb award for educational excellence for content.
Expert: Mike Wellman Date: 1/8/2008 Subject: tax write off
Question QUESTION: I have a question,
I own a small business,Last year I licensed It.I wanted just the name at that time i wasn't looking to run the bushiness at that particular time.I had to Check all the qualifications and the legal part about running it before i can open and recive clinets.This coming spring i hope to have it ready for inspection.The reason I'm inquiring is i want to know if i can use a tax write off for the Items and the machines I have purchased?along with any of the building equipment that will be needed in remodling the shop?
ANSWER: You can write off all machinery and equipment as well as operating costs of your business. However, you will need to wait until the items are put in service - i.e. you begin using them to generate income - before you can write them off. That should be in the Spring per your plans.
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QUESTION: does this mean that i can collect a tax write off for the past year or even this year 2008 for the following year 2009 if I'm unable to have it running?And i also was wondering i heard there was some kind of thing that if you do' not receive over a certain amount of income for your business you don't have to pay in at the end of the year?
Answer You will not be able to write off the equipment until you begin operation, regardless of the year.
If you have no income, you owe no taxes. So if your income in the first year is $20,000 and you have $20,000 or more in expenses, you will owe no tax on your business.
