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About Tax Map Website
Publication 535
Business Expenses
Introduction, Useful Items and Important Changes
For use in Preparing 2018 Returns

Chapter 1
Deducting Business Expenses

What Can I Deduct?

Cost of Goods Sold
Capital Expenses
Capital Versus Deductible Expenses
Personal Versus Business Expenses

How Much Can I Deduct?

When Can I Deduct an Expense?

Not-for-Profit Activities

Gross Income
Limit on Deductions

Chapter 2
Employees' Pay

Tests for Deducting Pay

Test 1—Reasonableness
Test 2—For Services Performed

Kinds of Pay

Education Expenses
Fringe Benefits
Loans or Advances
Reimbursements for Business Expenses
Sick and Vacation Pay

Chapter 3
Rent Expense


Taxes on Leased Property

Cost of Getting a Lease

Improvements by Lessee

Capitalizing Rent Expenses

Chapter 4

Allocation of Interest

Interest Expense Limitation

Interest You Can Deduct

Interest You Cannot Deduct

Capitalization of Interest

When To Deduct Interest

Below-Market Loans

Chapter 5

When To Deduct Taxes

Real Estate Taxes

Income Taxes

Employment Taxes

Other Taxes

Chapter 6

Deductible Premiums

Self-Employed Health Insurance Deduction

Nondeductible Premiums

Capitalized Premiums

When To Deduct Premiums

Chapter 7
Costs You Can Deduct or Capitalize

Carrying Charges

Research and Experimental Costs

Intangible Drilling Costs

Exploration Costs

Development Costs

Circulation Costs

Business Start-Up and Organizational Costs

Reforestation Costs

Retired Asset Removal Costs

Barrier Removal Costs

Film and Television Production Costs

Repair and Maintenance Costs

Chapter 8

How To Deduct Amortization

Starting a Business

Business Start-Up Costs
Costs of Organizing a Corporation
Costs of Organizing a Partnership
How To Amortize

Getting a Lease

Section 197 Intangibles

Section 197 Intangibles Defined
Assets That aren't Section 197 Intangibles
Safe Harbor for Creative Property Costs
Anti-Churning Rules
Incorrect Amount of Amortization Deducted
Disposition of Section 197 Intangibles

Reforestation Costs

Geological and Geophysical Costs

Pollution Control Facilities

Research and Experimental Costs

Optional Write-Off of Certain Tax Preferences

Chapter 9

Who Can Claim Depletion?

Mineral Property

Cost Depletion
Percentage Depletion
Oil and Gas Wells
Mines and Geothermal Deposits
Lessor's Gross Income


Chapter 10
Business Bad Debts

Definition of Business Bad Debt

Types of Business Bad Debts

When a Debt Becomes Worthless

How To Claim a Business Bad Debt

Specific Charge-off Method
Nonaccrual-Experience Method

Recovery of a Bad Debt

Chapter 11
Other Expenses

Reimbursement of Travel and Non-Entertainment Related Meals


Miscellaneous Expenses

Chapter 12
Qualified Business Income Deduction

Taxpayers Who May Take a Qualified Business Income Deduction

How To Figure the Deduction

Worksheet 12-A Specific Instructions

Schedule A—Specified Service Trades or Businesses (SSTB)
Schedule B—Aggregation of Business Operations
Schedule C—Loss Netting and Carryforward
Part I—Trade, Business, and Aggregation Information
Part II—Determine Your Qualified Business Income Component
Schedule D—Special Rules for Patrons of Agricultural or Horticultural Cooperatives (Coop)
Part III—Phased-in Reduction
Part IV—Determine Your Qualified Business Income Deduction
Coordination With Other Code Sections.
Special Rules

Chapter 13
How To Get Tax Help

The Taxpayer Advocate Service Is Here To Help You

What is the Taxpayer Advocate Service?
Low Income Taxpayer Clinics (LITCs)