To say, "helpful IRS" sounds like an oxymoron, but it really is true.  Particularly for small businesses, the IRS provides many helpful tips, reports, and forms, as well as other helpful information.

Today, my focus is on the IRS tax calendar for 2010.  I just received mine by mail and I was very pleasantly surprised.  The calendar was colorful and on good heavy stock, with illustrations throughout.  Each month even has a "quote of the month."

The theme for the 2010 calendar is "Helping to Grow Your Small Business, " and every month they focus on a different topic.  January, for example, is starting up a business, choosing a business structure and a tax professional.  Each section is very short, but it gives you a starting place for your information search.

Of course, the calendar itself includes tax due dates, including income taxes, employment taxes,excise taxes, and other taxes.  Following these due dates will help you stay on top of your taxes.  You can also sign up for my Newsletter and receive timely updates on taxes and reports due each month.

You can order the IRS 2010 Business Tax Calendar online at no cost.  I received mine in about 3 weeks, so now is a good time to order.

For more information:

How the IRS Can Help Your Business

Back in the good old days, (pre-recession, that is), many business people figured they should get all the good things in life from owning a business.  Many owners and board members would plan luxurious vacations and call them "board meetings" and deduct the costs as a business expense.  No more.  In addition to cracking down on entertainment expenses, the IRS also looks unfavorably on conferences, seminars, and board meetings on cruise ships.  You can still take these trips, but there are limits.

Cruise Ship Expense Limit
You can deduct up to $2,000 a year for expenses of meetings, conventions, or trade shows held on cruise ships (the IRS considered any ship to be a cruise ship), but only if all the following conditions are met:

1. The event must be directly related to your trade or business
2. The cruise ship is registered in the U.S. (I found this requirement strange, since most of these cruise ships have non-U.S. registrations)
3. All ports of call are in the U.S. or U.S. possessions

In addition,  you must provide:

1. A written statement detailing the total days of the trip (not including days of transportation to and from the cruise ship port), the number of hours each day devoted to business activities, and the program of scheduled business activities
2. A statement by an officer of the organization or group sponsoring the meeting that includes a schedule of each day's business activities, and the number of hours you attended the scheduled business activities.

Conventions Held Outside the North American Area

You cannot deduct expenses for attending a convention, seminar, or similar meeting held outside the North American area unless:

Image: Angelo Cavalli/Getty Images

After reading yesterday's blog post about car expenses, a reader asked, "How do I know what car expenses I can deduct from my home business? What travel from home to other locations is deductible?"

Can I Deduct Car Expenses Going Back and Forth from my Home Office?
You can deduct business-related car expenses for travel back and forth under these circumstances:

• You work at home or from home and your home is your principal place of business (the place where you earn most of your income or where you do your administrative or management tasks)
• You don't commute back and forth from your home to an office.
• You can prove that the car expenses were business related, not personal.

Two Examples
Sunny works from home as a freelance writer. She has online clients, but she also has local clients. She can deduct any car travel to drop off or pick up work from local clients, and to travel to the office supply store for supplies.  She should be careful not to combine business trips with personal ones, like personal banking or a stop at the grocery store.

Karl works out of his home as a manufacturer's representative, and he travels around the state to meet clients and discuss purchases.  He does his administrative work at home, so it is his primary place of business. He keeps a log in his car and records mileage for all car travel, from his home to client locations, hotels, and back.

In both of these cases, the small business owners can deduct all business travel to and from their home.

How Do I Prove Car Expenses are Business Related?
The IRS looks very carefully at car expenses for small businesses.  They want to see detailed records that:

• Were prepared at the time of the expense (not weeks later) and
• That detail the date, reason for the trip, and include any other information to show that the trip was business-related

What Car Expenses Can I Deduct?
You can deduct all ordinary and necessary expenses related to business travel, but no personal travel. You can deduct these expenses for car travel to and from business locations.  For example:

1. the home of a client
2. the office store where you buy office supplies
3. temporary job sites where you work for clients
4. places where you meet with clients, customers, or business advisers
5. your warehouse or the place where you keep your business inventory
6. a convention center where you participated in a business seminar

How do I determine these car expenses?

• You can use the standard mileage deduction rate set by the IRS (55 cents a mile for 2009), or
• You can keep track of actual costs for all car-related expenses.

Using the standard mileage rate is less trouble, because all you have to do is set out the miles traveled for business purposes, but the actual cost method sometimes results in higher deduction amounts.

First-year Rule for Standard Mileage
If you don't use the standard mileage rate the first year of your business, you can never use it again.  If you do use standard mileage the first year, you can then select the rate which will give you the highest possible tax deduction.

Remember, although business travel to and from your home based business is deductible, it must be documented and recorded at the time of the trip.  Don't get caught shorthanded without these documents in the event of an IRS audit of your business.

For More Information:
More about Taxes for Home Based Businesses

Standard Mileage vs. Actual Expenses - Which is Better?

"I have my company logo on my car.  Someone told me I can deduct the car as a business advertising expense."

"Can I deduct expenses for going back and forth from my home to my office?"

"If I can make business phone calls when I'm commuting, can I deduct the car expenses?"

"If I use my car to take business materials, tools and equipment back and forth from home to work, can I deduct these car expenses?"

Small business owners have lots of questions about tax deductions for business use of cars and there is a lot of misinformation out there. These are some of the most common questions.  If you have other questions, comment on this post or in the Forum.

Business Vehicles as Advertising
You can certainly deduct the cost of putting the logo on the car as an advertising expense, but you can't deduct the miles you drive around as "advertising." The IRS says, "Putting display material that advertises your business on your car does not change the use of your car from personal use to business use.  If you use this car for commuting or other personal uses, you still cannot deduct your expenses for those uses."

Commuting Expenses are Not Deductible
The time you spend driving back and forth from your home to your business is considered "commuting," and it is not deductible as a business expense.  Consider it this way - everyone needs to get to work, employees and business owners alike, so this expense is not part of your business.

Use of Car While Commuting
If you use your personal car to transport materials, supplies, or equipment back and forth from home to office, the IRS says this doesn't make the car expenses deductible. Even if you use commuting time to talk on your cell phone about business matters, the car costs are still not deductible.  Of course, you can deduct the cost of the cell phone and any additional charges.

Even If the Business Owns the Car
If your business has purchased the car, you still must separate out personal use of that car for tax deduction purposes.  Only the business use of the car can be deducted.

For More Information:
Records to Keep for Car/Truck Expenses
Standard Mileage Deduction vs. Actual Mileage Expenses

Disclaimer: I am not a tax professional or Enrolled Agent, and my purpose in presenting this discussion is to provide general information and give you some background so you can talk about this subject with your tax professional.