Supporting Documentation

To use your itemized sheet effectively, the IRS requires proof for every entry: 

• Receipts and Invoices: For all medical, charitable, and business-related costs.

• Bank Records: Canceled checks or electronic statements.

• Form 1098: For mortgage interest and property taxes paid.

• Vehicle Log: For medical or charitable mileage tracking. 

Landlords can deduct ordinary and necessary expenses incurred for the purpose of producing rental income

Businesses can deduct all ordinary and necessary expenses to reduce their taxable income, subject to specific limits and new provisions under recent tax law updates. Key updates include increased limits for Section 179 expensing and the permanence of 100% bonus depreciation. 

 Only self-employed individuals and business owners can deduct home office expenses in the U.S., provided they meet specific IRS criteria. W-2 employees working from home are ineligible for this deduction. 

To qualify for the home office deduction, you must meet two primary tests for the portion of your home used for business: 

• Exclusive Use: You must use a specific area of your home exclusively for your trade or business on a regular basis. An exception exists for space used for storing inventory or product samples, or as a daycare facility.

• Principal Place of Business: The space must be your principal place of business, a place where you regularly meet clients or customers, or a separate structure not attached to your home used exclusively for business

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