all right welcome everybody to an important Facebook live and live YouTube
stream on holiday tax write-offs now this includes holiday travel holiday
gifts I'm gonna bust it out I've got five or six notes here very important
had three or four CPAs hoping with me with some research today this is tricky
stuff and so if you're a business owner and you're gonna spend money around the
holidays traveling and maybe giving some gifts can we find a tax write-off for
some of that the answer is yes now there's gonna be some boundaries and we
don't want to get too crazy we know whatever get into other problems with
the IRS would be honest and ethical but there are options for strategies and so
we're going to go through them thanks everybody for being here please yeah
don't go anywhere we're gonna keep this tight 15 minutes
or less I want your questions in the comment section please put your
questions I'll be fielding those as we go my contact information will be down
in the messages as well and I hope that we can be a service for you during this
holiday season you're in tax planning is so so important now I'm a CPA an
attorney best-selling author of the new book best sell ya business owner's guide
to financial freedom what Wall Street isn't telling you just came out of a
week ago I say best-selling author because I have three other books so I've
sold a ton of books I'm out there helping you the entrepreneur live your
American dream I'm also a senior partner in the law firm of kink u.s. lawyers and
accounting firm cainy CPAs anyway I'm out there so I want you to feel like
this is legit you can count on it be careful what you look and find out on
the web I know you can find some website that'll let you do what you want to do
but that may not be the right answer so we're gonna knock it out here okay so
let's hit travel and I want it I'm gonna practically the holidays up here so
holidays and we're going hit three or four different points and
I'll pause for any questions got Nancy here on the computer
fielding any questions that you might have the first point I want to make is
travel now travel is your easiest write-off it's a hundred percent
deductible for business purposes and that means stuff like airfare hotel uber
tips ballet any sort of travel transportation and all that hotel stuff
that's a hundred percent right up now the beauty of that if you can write it
off whenever you have a business purpose so what I want you to do is have your
board of directors meeting during the holidays maybe it's a Thanksgiving maybe
it's around Christmas or New Year's but how dinner have a meeting take notes of
what your 2018 goals are build that part of advisor to board of directors then
you can go to my youtube channel and see multiple videos on how to build a board
of directors how to build a Board of Advisors how to use them
guys this can help you as an entrepreneur so much even if you don't
take the tax write-off I want you thinking about how to get engaged with a
board that can help me succeed now again if you travel somewhere timing is
important because your day to get there as a write-off your day to get back as a
write-off and your day therefore the meeting is a write-off so think of it
like the Thanksgiving scenario you travel on Wednesday
you have Thanksgiving on Thursday but you take the time for a documented Board
of Directors Board of Advisors meeting that you put in your minutes of your LLC
or your minutes of your corporation and then you travel back on Friday that's
100% right now I would write off 100% of your airfare and if you stayed in a
hotel because you don't want to stay the family in the house you know what I'm
saying so think about what you could do to take a write-off around Thanksgiving
now if you state multiple days a business day is considered around four
hours so you want to get at least four hours of work in checking on a rental
property meeting with a vendor whether customer selling product or
service meeting with some sort of strategic partner or affiliate all very
very powerful now that is auction one is traveling
Nancy any questions on travel so far alright guys I'm here for you so if you
have questions any one of these topics I want you to hit it now dining during the
holidays is going to be a write-off it's limited to 50% I've got more food
that we're gonna ride off 100% of but dining out I'm going to call it dining
out is limited by 50% so let's say you go to dinner but you talk business and
again you may be meeting with your board of advisers directors and vendor a
customer property manager partner whatever that's a business write-off and
that dinner is going to be deductible up to 50% that includes the bar tab the
food the tips yada yada so dining is a big one and I love that
now you can get away with a hundred percent right off for food if it is a
holiday party for employees and I'm gonna put four employees or vendors and
over 50% of those in attendance this is the rule with the IRS over 50% of those
in attendance are non owner officers so you can't just say I'm gonna do this
with my family because there are my board of directors they you can still
write off your travel and a half a dining to have to work directors meeting
with a family scenario my wife and my kids are all on my board of directors
that's gonna be a write-off we're gonna do a little bit of that around Christmas
we're gonna take notes we're gonna have a training my kids love it I totally
ruined Christmas with the business training right now but but a holiday
party where I have my law firm employees come out that's a hundred
right off because it builds morale and it's it's a it's a presentation morale
building type of then with more than 50% of non-family non-owners so those are
our first three bright outside we I got more so don't go anywhere
Nancy questions the question was that came in as a cruise a cruise is a scary
one there are per diem daily limits on how much you can write off on a cruise I
believe I'd have to check the technical rule but I think it's two times the
federal dining or travel limit for a cruise so if you go on a cheap cruise
you might be able to write off most of it by the time you run the per diem
limits but if you do it a more expensive cruise you're gonna have limits number
two you've got show that the cruise in the first place it has a business
purpose every day so you're doing presentations or meetings and then
there's special rules about is a u.s. port or not it gets really really
technical so you want to talk to your accountant before you jump on a cruise
the better right off is an all-inclusive go to infer Resort go to a hotel go
skiing in the mountains go to the beach whatever stay at a hotel
have business meetings every day no matter what the cost is as long as
you've got a good business purpose and a little business income to justify it
you're going to get a hundred percent right off on the travel and fifty
percent on the dining next question have to have a stake in the conversation
business brought up okay so Riley said about this meeting what happens if
they're not participating in the meeting it's just they're there there has to be
some contribution from the person in the meeting and I hope you're not talking
about your five-year-old daughter or son but someone in the meeting that is
contributing or providing some sort of advice
I didn't put my teenagers on the board of directors till they were about
13 or 14 years old or they can actually make an insightful question or comment
if you believe in teenagers being able to do that but here on these three Riley
dining out anybody that's at the dinner that's making any sort of contribution
to the meeting and they don't have to be an owner or officer they could be a
customer a vendor or a child employee that dining is an easy one the hundred
percent party right off you've got to make sure that the people in attendance
far more than majority are non owners to get away with this rule there's special
revenue rulings and court cases on that with the IRS okay now I'm going to give
you the neck and this is probably the big man that's the scary one is that
people want to write off gifts now I'm going to give you the general rule and
then maybe some exceptions to this or some techniques with this the first rule
is it's limited and I know this sucks this is just ridiculous but gifts are
limited to $75 0:07 if I can't believe I said 75 that's
$25 I apologize $25 when some CPA about croaked in his chair watching this $25
limit now this is an individual so a gift to an individual and if they're
married that's times two so if you're you know I have spouses you can go times
two and also this does not include gift wrapping engraving some of those
expenses this is just the poor gift so I'm going to say excludes gift or
personalization I'm just gonna say personalization so it's kind of like you
know again gift wrap never gave them ingredient now here's the rule even with
this $25 gift rule you've got to have five criteria now I'm gonna just kind of
summarize these quickly in this kind of column area here you have to be able to
judge it indicate the cost the specific cost a description of the gift
you need to have show a business purpose the date who gave the gift in your
business relationship now for example in our firm we're getting out some charging
banks a Christmas card sometimes we're going to give out a gift basket we're
going to give it to a client and his or her spouse and we're gonna exceed the
$25 limit and go 250 on a lot of those gift baskets but that's a write-off we
have a business relationship the date what we gave them why and all that now
this is the general rule and this is kind of crappy I know now there's some
strategies out there that people talk about to get around this and I'm going
to bring up three of them and dancing before I get into these three exceptions
is there any questions he said there's our special rules meeting with potential
investors now again any time you want to go out
dining and do entertainment now I'm not talking about a holiday trip that you're
trying to shoehorn into a write-off if you're going to go out and meet with
customers or vendors or a potential investor and you're going to take them
out to Ruth's Chris and spending $500 on dinner and drinks and then you're going
to go out to a basketball game and buy them seats on the floor and smooth them
and talk business the whole time you're gonna run out 50% of that is dining and
entertainment that's a great write-off but if you're gonna try to do it around
the holidays with some family members on your board of directors that's kind of
what I'm talking about here is you've got to make sure you have a business
purpose for that meeting and just don't write off your trip for Thanksgiving you
got to be able to justify it and take notes
explain why great questions Riley okay now let's get over this $25 limit so $25
limit I'm gonna just mention a few strategies now for those CPAs out there
that are watching this is where I know you're gonna cringe a little bit how
aggressive you want to be if you search hard enough there's some regulations we
were finding this morning some Revenue Ruling some court cases we have various
resources the same as many of you be an AC CH Brad for tax institute we love a
lot of our resources many more than that that we've looked to for advice on this
but one of them is and I'm just going to throw these out is the $25 limit is to
individuals now that's quite clear in the regs that is to individuals there's
arguments out there that businesses are different so if you have a business
purpose with a business and it benefits the company as a whole and their
employees so maybe you buy iPods for this client of yours and they give them
to all their employees and that's considered a gift in some senses of the
word it's also a resource and how the business purpose is to a valid company
or corporation and they're going to use it in their business that may be
deductible to you and you don't need to 1099 them now that is again a great area
some people would argue that the definition of business is different than
definitions of individual stone I'm just giving you arguments and you can decide
what you want to do here the next one is gifts of entertainment now this is a
pretty clear one that's out there and we were excited to find this
I thought it was kind of interesting in a couple of cases I haven't seen before
is it instead of calling something a gift you can gift entertainment so you
can give show tickets theater tickets a sporting event even a scalped ticket
type of thing on ticket hub some resource to get cheap tickets and then
give a gift of entertainment now you in a lot of ways if you give to
entertainment you might be limited by 50% but there are cases and ranks out
there that allow for a hundred percent deduction when you're giving a gift of
entertainment with some of these gifts of sports tickets or theater tickets so
I if you're in that mode where you want to give away theater tickets or
something like that for a Christmas gift to a business client again with the
criteria of a business relationship purpose date cost and all that you
should be able to write up a hundred percent of that and be over the 25
dollar limit so those are a couple options that can work for you and the
the other one that I wanted to highlight is employees so if you're going to give
employees gifts you can give employees gifts of over $25 but if you do you
still get it right off but you have to include it in their w-2 and that's a
difficult situation so the employee might be like well thanks for the gift
but you slapped into my w-2 and then when you say well you want the
gift or not I'll take it so it's art but that's the technical rule on employees
I'll talk about maybe some Realtors that give gifts at closing and we'll come to
that a question business consultations that don't lead to a business that don't
this relationship and is this a topic only for the holidays okay two questions
Gloria says first if I'm having all these 30-minute lunch meetings and I'm
hoping some turn into business but some don't can I still write them off hey if
you're making a business pitch in that meeting you get a write-off for that so
just keep a record and your calendar of who you met with what you discussed and
and you're good and that's why keeping a good public calendar is very important
because if you ever get audited I want to go after those so keep a calendar and
those are great write off whether you close the deal or not because on a
regular basis you're going to close some of them and the IRS will see that those
were legit then she said does all this rules apply to the holidays the holiday
gifts I shouldn't say no you can do this gift
rule anytime during the year it could be valentine's holiday or fourth of July
holiday so I don't want it to say it's Christmas holidays the dining rules I'm
talking about are not specific to the holidays maybe I made this a twist on
the holidays because a lot of people don't think about using this strategy
around the holidays but all these rules I'm talking about are a year wide but
what I wanted you to do in this in this YouTube presentation or face book
presentation is think outside the box try to find a business purpose for your
holiday trips that's really what this is about any final questions and then this
is a wrap all right well folks everybody have an safe holiday drive carefully
drink responsibly party responsibly make sure you're talking business at your
your meetings and keep good tax records and talk to your accountant you might be
able to find it right off for this event thanks so much don't can you close this
down gotta get my text here to close down our Facebook live thanks I'm ready