(BQ) Part 2 book "Taxation of individuals" has contents: Business income, deductions, and accounting methods; property dispositions; property acquisition and cost recovery; retirement savings and deferred compensation; retirement savings and deferred compensation,.and other contents. | chapter 9 Business Income, Deductions, and Accounting Methods Learning Objectives Upon completing this chapter, you should be able to: LO 9-1 Describe the general requirements for deducting business expenses and identify common business deductions. LO 9-2 Apply the limitations on business deductions to distinguish between deductible and nondeductible business expenses. LO 9-3 Identify and explain special business deductions specifically permitted under the tax laws. LO 9-4 Explain the concept of an accounting period and describe accounting periods available to businesses. LO 9-5 Identify and describe accounting methods available to businesses and apply cash and accrual methods to determine business income and expense deductions. Storyline Summary Taxpayer: Rick Grime Location: San Antonio, Texas Family description: Unmarried Employment status: Rick quit his landscaping job in Dallas and moved to San Antonio to start a business as a self-employed landscaper. Rick left his job and moved his belongings to San Antonio. Once in town, Rick discovered he had to do a lot of things to start his business. First, he registered his new business name (Green Acres Landscaping) and established a bank account for the business. Next, he rented a used sport utility vehicle (SUV) and a shop for his place of business. Rick didn’t know much about accounting for business activities, so he hired a CPA, Jane Bronson, to help him. Jane and Rick decided that © BananaStock/Jupiterimages R Green Acres would operate as a sole proprietor- ick Grime graduated from Texas A&M ship, but Jane suggested that as the business grew, University with a degree in agronomy, he might want to consider organizing it as a differ- and for the past few years he has been ent type of legal entity. Operating as a corpora- employed by a landscape architect in Dallas. tion, for instance, would allow him to invite new Nearly .
