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elitebiz
03-03-2009, 01:58 PM
I am going to be doing a promotion which will cost around $1500. I estimate that I will make $3000 back from this promotion. However, here is my problem. Even if I make $3000, won't I really only be breaking even? I will be paying taxes soon and isn't that essentially like taking that $3000 and then cutting it in half to $1500 again? Is there any way I can use the $1500 (its for rental space) as a write off on my taxes?

vangogh
03-03-2009, 03:01 PM
You should be able to deduct what you spend on the advertising for your earnings for the year. So you'd only be paying taxes on the $1500 above the $1500 you spent and not the full $3000. The money you spend is a business expense and you should be deducting that from Profit.

I'm not sure how you fill out taxes, but the 1040 schedule C is a net profit or loss form. The very first expense listed is advertising. I would think you fill in $1500 right there, which ultimately reduces what profit and income you show.

nealrm
03-03-2009, 07:20 PM
as vangogh stated you can deduct advertising. Your accountant can give you more details. Or if you use a tax program, it should prompt you directly for advertising expenses.

Business Attorney
03-03-2009, 09:51 PM
Yes, expenses which are incurred to produce income are generally deductible. Advertising certainly falls in that category.

Evan
03-03-2009, 10:25 PM
Who owns the rental? You personally (or a disregarded single-member LLC)? If so, rentals would flow through onto Schedule E. More often than not, rentals create losses.

Though I have a feeling you are not talking about rental property in the same context I am. But if you are, perhaps this information will provide you good use.