Originally posted by: EagleKeeper
Originally posted by: E equals MC2
This year will be the first time I'll try to do the taxes on my own. I usually give it to my parents' accountant but frankly I think he's an idiot. He's always aloof and I wonder if he listens to half the things I mention to him such as below:
1. I heard you can write off you rent. How do I ACTUALLY do that?
2. I spent about $2K on camera equipment so I can be an event photographer. Can I write this off as a business expense? I have a corporate day job and photography is more of a side-cash job. How can I accomplish this if possible?
3. What other things that a typical 26 yo-old bachelor can write off? I certainly didn't know rent could be written off.
4. Now, what's the best way to start off doing my own taxes for the first time? Just pick up one of those tax softwares? If so, how do I accomplish above 3 items?
Thanks guys! You guys are a wealth of knowledge!
1) Rent is not able to be written off on the Federal return. Some states may allow a renter's credit.
2) If you claim any income from being a photographer, you can use the Schedule C to write off related expenses. If you do not claim income, then it is just a hobby. Hobby expenses are not deductible.
3) The standard things require you to itemize using the Schedule A.
That covers:
Medical costs (> 7% of your income)
State Income taxes
Property Taxes
Mortgage Interest
Casualty Loss (> 10% of income)
Charity
Misc Business Expenses - no commuting costs (> 2% of income)
The total of the above must exceed your standard deduction (married/single) to be of value.
Reducing your tax load outside the Schedule A requires having business income, educational expenses or adding dependents.
4) You should either spend the $10-$20 for some tax S/W or download the PDF forms from the IRS Web site and play with them using pencil, paper and calculator.