What is the difference between deducting the purchase price of something vs A monthly subscription fee?
My question is what is the difference between deducting the cost of the purchase of a cell phone vs. The monthly cost of using it? Do you always have to buy the cheapest you can get away with ie. Paying $800 for an iPhone when an $80 phone would do the job just fine. Also some of the equipment was purchased in previous years. My parents have always made me go to a tax place to have my taxes done but all they do is use the W2 from my full-time job give me the standard deduction and tell me they can't use anything esle. In previous years I wasn't even trying to do a business and made $0 in income. This year I was told I either had to make some extra money to pay for my equipment or sell it if I wasn't going to use it. Sadly, I'd likely get $50 from selling everything.
We're also looking at things like purchasing $300 Peavey speakers for a DJ show with I could order Marathon speakers for $135 each that do the same thing. Most real professionals will go with the Peavey, while the guys who like to undercut everyone and put on a show $50 for the whole evening will use the cheapest they can get.
I wanted to do my own taxes this year but my parents told me "no" because we don't know for sure that they won't need more than my W2, but I'm going to guess they won't. I'd like to try Credit Karma Tax, but what if I'm wrong? I just didn't like the way H&R Block charged me up the nose last year and the guy acted like he wasn't interested in anything but my W2.
Depending on the item, you may not be able to deduct the whole price, you may have to depreciate.
Why do you think you can even deduct the cost of the phone at all? The first phone you have is considered personal and is not deductible at all.
Did you make any money from your DJ business in 2017?
In previous years have you included any business information on your tax return? This would probably be a Schedule C.
If you have never done a Schedule C, there would probably not be a problem with using the free online tax software.
You can always try it and if you don't like the results, don't submit it.
You can use your previous tax return document as a guideline to whether you feel comfortable with the tax software being accurate for your situation.
You don't have a business if you don't have any income from it, therefore you have nothing additional to report. When you're in the start up phase of a business, you have to accumulate your costs up to the day you're ready to actually work.
If this is not something for your business, you don't
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