Why do the self-employed write off too little?
They often cheat themselves by considering an expense personal when it’s really a business expense. In the corporate world, it’s clear who is a business associate, and who isn’t. For the self-employed, that line is very wiggly. Just because someone is a friend or a family member doesn’t mean he or she isn’t a business associate. Q: In that vein, you say that a gift for mom can be a legitimate deduction. How so? A: Say your mother watched the kids because the babysitter didn’t show, and you had to do this interview. You thank her by sending flowers. You can write that off. [The limit is $25 per gift.] You note on the receipt that it was a gift for mom because she watched the kids while you did an interview. Or say an information-technology consultant is going out on her own, and her husband is in the ad business. They have three kids. She wants him to look at her brochure and help lay out a business plan, so they go out to dinner. She can write it off even though it’s with her husband.
