Do you write off..

[Creative_Lance]

Your wasted design time and all of your virtual work?
I asked my tax lady last year and after she asked her supervisor she told me i couldn't!

 

[Fred Weiss]

Your write off comes in the sales you didn't make in that time ... less profit subject to taxation. The only thing you can write off is what you actually spent money to acquire and that is allowed by the IRS.

 

[gabagoo]

you technically have written it off as I am sure you paid yourself to do the design work whether you got paid for it or not.
does that make any sense? if you haven't paid yourself for it, then go write a cheque right now...BAM write off!!!

 

[Creative_Lance]

Good enough, thanks guys!

 

[Gino]

If you go to the shoe store and try a few pair of shoes on and nothing fits or strikes your fancy and you walk out without buying anything.... do you think the shoe company has made a sale in which they can write off anything if the shoes are still on the shelf ?? The sales guy worked hard and brought several pair out for you to try on and had to pack them all back up in the boxes and put them away. No money has passed any hands, so you're still stuck with jack. However, the company that employs the salesperson can write his wages off, so if you are a paid person on your own payroll, you still can write off your wages, but you can't write off something which didn't happen.


Let me ask you this.

Why are you designing for free..... for someone that hasn't given you a deposit ??

 

[Creative_Lance]

If you go to the shoe store and try a few pair of shoes on and nothing fits or strikes your fancy and you walk out without buying anything.... do you think the shoe company has made a sale in which they can write off anything if the shoes are still on the shelf ?? The sales guy worked hard and brought several pair out for you to try on and had to pack them all back up in the boxes and put them away. No money has passed any hands, so you're still stuck with jack. However, the company that employs the salesperson can write his wages off, so if you are a paid person on your own payroll, you still can write off your wages, but you can't write off something which didn't happen.


Let me ask you this.

Why are you designing for free..... for someone that hasn't given you a deposit ??

I do get paid for designing of course! Sometimes my regular customers make changes but i couldn't charge for them and then they ask to e-mail proofs and what not, i know it's not much but it adds up throughout the year add to this the employee's mess up's when taking the orders that i can't fire them for, i'm sure everyone wastes time one way or another.

 

[threeputt]

Seems like the term "write-off" is being thrown around here in various and somewhat inaccurate ways.

A write-off, for all intents and purposes, is a deduction you can take against income for monetary losses.

First you have to have income. Secondly, you have to have a monetary loss. And be able to demonstrate that loss if called upon.

Not being able to work because it's raining, materials didn't arrive in time, customer cancelled his order, things like that are not deductible.

 

[trakers]

The general public has no real understanding of what a "writeoff" is.

Reminds me of Seinfeld where Cramer tells Jerry that the Post Office will write off the cost of his "damaged in shipment" stereo equipment. Jerry says "You don't even know what a write off is do you?"

What irritates me is if you earn a living doing web design, for instance, and donate 80 hours of design time to an organization, you are not allowed to write it off. That is unfair, but I understand why you can't.

 

[ddarlak]

fire your accountant, do your own taxes.

the more you learn the better your off

 

[B-RAD Graphics]

fire your accountant, do your own taxes.

the more you learn the better your off

i would never attempt to do my taxes myself..not saying if you know what you doing you cant...but the way I see it it raises a red flag to them...but what da hell do I know .... all I know is I have been hearing about smaller business being audited...sure.. go after the small guy wdf

 

[Graphics2u]

What irritates me is if you earn a living doing web design, for instance, and donate 80 hours of design time to an organization, you are not allowed to write it off. That is unfair, but I understand why you can't.

Yeah, I've had people from different oranizations ask for donated things, whether it's signs, banners or just time. And they tell me "It's tax deductible!" They have no idea that the only part of a $200 Banner that's tax deductible is what ever i paid for the materials and ink. The rest of it whether it's the time to produce it or design time or the profit you would have made on a paying customer is just money down the drain. Not that I dont' help out some groups but they almost feel like you're just as well off to donate it be cause I can "write it off"!

 

[Fred Weiss]

Yeah, I've had people from different oranizations ask for donated things, whether it's signs, banners or just time. And they tell me "It's tax deductible!" They have no idea that the only part of a $200 Banner that's tax deductible is what ever i paid for the materials and ink. The rest of it whether it's the time to produce it or design time or the profit you would have made on a paying customer is just money down the drain. Not that I dont' help out some groups but they almost feel like you're just as well off to donate it be cause I can "write it off"!

Even that isn't quite accurate because, depending on your accounting system, you have either already written off the purchase of those materials or you will count whatever is left as inventory at the end of the year. Thus the write off is whatever has been consumed. But it would also have been written off had you been normally paid for the job.

The only true write off you would have is if you went out and spent money for the work. For example, you call an outsource vendor and order a banner for the charity and pay for it out of your business. That goes straight through to your ledger as an expense. Another example would be if you ordered the materials for the charity and called in a part time employee to make the banner. When you pay the employee and the material supplier, that becomes a expense. In both examples, there is no sale, therefore whatever you spent is written off by way of the expense ledger. If it cost you $100 and you had the charity pay you $25 for it, you have a difference of -$75 which is an expense in your books.

In summary, there has to be a cash loss that is expensed. That expense must go to someone who pays taxes on the amount received. So, for example, if you cut yourself a check for $100 in supplemental pay to create the expense, then you would have to pay income tax on the $100.

There's no way around it. The only write off you get for donations is the reduction of your own gross sales that you might have received by using the time and materials for a normal sale.

 

[Graphics2u]

Even that isn't quite accurate because, depending on your accounting system, you have either already written off the purchase of those materials or you will count whatever is left as inventory at the end of the year. Thus the write off is whatever has been consumed. But it would also have been written off had you been normally paid for the job.
.

That's what I meant. I didn't explain it well. There is not a separate deduction for those specific materials used on that project. Just the normal goods consumed. At any rate a donation is just that, money or time out of your pocket given to someone else.