Plan on giving a gift to your clients or colleagues?
You’ll want to bookmark this in your internet browser.
If you give your clients or colleagues a thank you gift, birthday day gift, or holiday gift, then you can deduct up to $25 per person per year. (🗣) Pay attention to the wording….. “up to”. So you can spend more than that if you choose but you can only deduct up to $25.
Be sure to track how many you’ve purchased so your bookkeeper can record them accurately and your tax preparer can calculate it accurately. SIDE NOTE… there is a difference between a bookkeeper, accountant, tax preparer. If you want to know the difference just comment below ⤵️ and I’ll do a separate post.
The $25 IRS limit is not per gift. For example, Tia received a birthday gift and holiday gift from her employer. The employer is allowed 2 gift deductions for Tia for 2020.
The $25 IRS limit DOES NOT apply to the cost of
❌ Engraving
❌ Shipping
❌ Packaging
But those costs are usually ordinary business expenses.
Don’t believe me…… check out IRS Publication 463.
If you haven’t tracked your business income nor expenses all year click HERE to schedule an appointment, so we can get you on track before #2020taxseason begins.