Deducting the Home Office - Record Keeping...
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To have good records, you must track your income and expenses.
Federal law only allows you to deduct the business expenses that you can prove.
In order to be able to prove you had a real and legitimate expense, you must
keep records. These records simply track how much you really spent, where you
spend it and why it was necessary to do so. These records will be golden proof
of allowable expenditures if you are ever audited by the IRS. There is no
particular method of bookkeeping you should use, however, it is important that
you use a consistent method that clearly and accurately reflects all of your
income and expenses.
You may receive income from many different sources and your records will
identify these sources so that you can separate business from non-business
income and taxable from non-taxable income. It is also very easy to forget to
record expenses, but you will find that if you record it when it happens, your
records will never skip or incorrectly identify those expenses for which you may
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