Car Racing Business Deductions Tax?
I am working on a tax return that has a small side business of car racing. He has many expenses which are legitimate deductions the thing is that i am...
I am working on a tax return that has a small side business of car racing. He has many expenses which are legitimate deductions the thing is that i am unsure of where to put the expenses for engine parts and methanol fuel. Any help would be greatly appreciated
Engine parts would normally be a capital asset, that should be depreciated over its useful life (5 years). You could probably make an argument that due to the nature of car racing, engine parts wear out regularly and their useful life is really only one year. In that case, the cost of the parts and the cost of the fuel would be a normal business expense. You could categorize the engine parts as repairs expense on the Schedule C, and itemize the fuel under "Other Expenses".
Wow, you are a tax accountant/preparer and dont know what you are doing…..terrific.
Business expenses and Income are reported on Schedule C.
I filed my taxes online at http://www.expresstaxrefund.com and they had a section to fill out all of your deductions, quite simple if you ask me. I would try filling it out there and if you had a question just call the tech support line. They are there almost all day.