Discussion:Buisness Leasing

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Discussion Forum Index --> Advanced Tax Questions --> Buisness Leasing
Discussion Forum Index --> Tax Questions --> Buisness Leasing

Mmm13 (talk|edits) said:

16 November 2007

This seems like a great place to ask a tax question. I am a current student at Albion College in Michigan. I am taking a tax class and our professor gave us research project. I was wondering if anyone would help me out here. My research question is as follows...

Taxpayer has always been interested in woodworking and became quite talented at making country-style wooden furniture. Last year, the taxpayer decided to open a store to sell the furniture. A three year lease was signed in Februaru and buisness began in March. By January of the following year, it became obvious that the business was not going to be afinancial success, so it was closed. Taxpayer continued to pay the monthly lease until September when another buisness movied in and signed a new lease. Even though taxpayer has been out of buisness since January, can the lease payments through August be deducted? If so, how?

I would appriciate any help i could get. Thank you

TheTinCook (talk|edits) said:

16 November 2007

At least you were honest about having a homework question (except for in this thread). Most people here will be happy to help you, but you have to put in a little more effort then clicking "post reply."

Back to the question: It depends on the type of business entity. I'll assume sole proprietor. Yes, it can be deducted. Since the taxpayer is no longer conducting an active business would you base your position on Sec. 162 or Sec. 212?

Tdoyle (talk|edits) said:

November 16, 2007

Mmm13:

Welcome to TaxAlmanac, and thank you for being honest that you're working on a research project for your tax class. I think many professionals on the site would be happy to lead you in the right direction as long as you don't abuse the forums (such as posting too many questions), but I doubt they'll give you the full answers.

As you're working through your tax class, please consider how you might be able to "give back" to TaxAlmanac. Could you and your other classmates start short summary articles here on tax related topics as you do your own research for the class? This site is designed to be like Wikipedia - except for taxes. Users are encouraged to start articles about tax topics, and also to enhance pages that others have started. In this way, we can together build a resource which can benefit the entire community. Do you have to write essays about taxation? In addition to turning it in, please consider posting it here! Ask your instructor if a collaborative effort to create an article here might count as extra credit.

Thanks again, and welcome to TaxAlmanac!

- Tim Doyle, TaxAlmanac Moderator - Talk to me 08:08, 16 November 2007 (CST)