Considering the tax implications of making purchases

It's always exciting getting a new phone.

One of our members needs to purchase new phones for he and his wife. They have an interesting situation in that she is self-employed and they also have rental income. That means that there are things to consider, that is different portions of their income can be taxed differently.

If you are trying to maximize deductions, the self-employed person should be purchasing the more expensive phone for their business use,  while with the less expensive phone a portion of it should be allocated as a rental property expense. This, of course, only applies if you are actually using these things for their intended purposes--you should always shy away from shady business with your taxes, because it just isn't worth it. As always, it helps to run this by someone who actually knows what they're doing, like an accountant.

Next week, we're going to talk taxes some more, particularly how getting married impacts your taxes.

Profit!