I guess I will talk about business gifts again. This is always a hot topic and a few acquaintances were asking the other day.You can only deduct $25 for business gifts per year per giftee; if you have a separate business relationship with both husband and wife, you can gift them each $25.You are probably wondering why such a low amount. Well, the law hasn’t changed since 1962, when a car cost $2000 and gas was around 30 cents a gallon. Our friends in Washington have dropped the ball again.Keep your gifts small (gift cards work well for a single gift each year). If you have to send a more expensive gift, keep the $25 limit in mind and figure the rest is just business goodwill – nondeductible of course.
Brian’s Tax Musings
Sorry I forgot to post this yesterday – No receipt is required for entertainment, overnight travel and listed property if the expense is less than $75.Just remember that even though a receipt isn’t required, you need to still document by journal or log the ususal ‘who, where, when, why and how much’ as far as entertainment and meals goes. In the list for travel and listed property, the who would be the hotel or airline or the item purchased. Just because the receipt isn’t documented doesn’t mean the other documentation isn’t needed for a deduction.
Brian’s Financial Musings
A final note on the debt ceiling (I hope). Despite the fact I believe a deal will be made before August 2, this reminds me of a guy who has maxed out all of his credit cards and now can only pay his mortgage by getting an increased line on this same card. What would a bank do? Tell him no and then the guy would have to sell something or get forclosed and probably declare bankruptcy. By doing this the government is really sending the wrong message in that instead of trying to balance their budget, they are just getting permission to borrow more. It is going to have to stop sometime. This is why most governments (U.S., City, State and foreign) have all the financial problems they are having – spending more than they bring in and instead of staying in balance trying to find a way to spend more.