What may be the craziest part of the list of nine wacky charges is that six of them were actually approved as legitimate business expenses
165(d) stated only, "Losses from wagering transactions shall be allowed only to the extent of the gains from such transactions." For many years before 2008, the IRS interpreted "losses from wagering transactions" to include professional gamblers' business expenses
, so that they were deductible, along with wagering losses, only to the extent of gambling winnings.
As a result, these donations would be deductible as business expenses
under IRC section 162 rather than as charitable contributions.
That reality makes it essential for franchisees to understand the rules when it comes to business expense
The IRS ruled that Employer D's reimbursement arrangement satisfies the business connection requirement because it reimburses employees only when a deductible business expense
has been incurred in connection with performing services for Employer D, and the reimbursement is not in lieu of wages that employees would otherwise receive, Although Employer D has reduced the amount of compensation it pays all of its employees, the reduction is a substantive change in the compensation structure, Under the arrangement, reimbursement amounts are not guaranteed, and employees who do not incur deductible business expenses
or who do not properly substantiate such expenses continue to receive the reduced hourly compensation.
In the third quarter, consolidated and mainline CASM, excluding special charges and third-party business expense
and holding fuel rate and profit sharing constant, increased 2.5% and 2.0%, respectively, compared to the results for the same period of 2011.
The IRS finalized rules it put into effect in 2012 allowing employees to deduct certain expenses paid or incurred for local lodging as business expenses
This is because an acceptable medium of exchange for barter transactions is available only on an exchange, and the recognition of tax liabilities for a business expense
requires economic performance.
162 (trade or business expenses
) or 167 (depreciation).
"One measure of their commonness," TEI said, "is their longstanding treatment as an ordinary and necessary business expense
deduction under section 162.
Speltz deducted the reimbursements on her schedule C as a business expense
and the couple excluded the payments on their joint tax returns.
whether a particular business expense
qualifies for a deduction.