Any expenses derived from maintaining the production or collection of income is tax deductible. Some deductions are Itemized while others are subtracted from the taxable amount of an income stream.

Examples of itemized deductions, if directly related to investments are: investment counseling fees, telephone fees, clerical assistance fees, office rent, and travel expenses.

Expenses related to rents and royalties are subtracted directly from the income stream and are not treated as itemized deductions.

Taxpayers should speak with tax-professionals to find out which expenses to keep track of for their specific investment portfolios. They should then keep track of any and all expenses. If something is questionable, they should have their accountant decide on the validity of the deduction when filing the return.

It should be noted that keeping track of expenses on a daily or weekly basis will result in far more accurate records than trying to mentally recollect a years worth of expenses and then find proof. A little time spent during the year can save a lot of time, money, and aggravation at tax-time.

(c) Copyright 1995-2024 by TaxLogic