How can I utilize Research & Marketing write off?

Question

As a small business it is important that I maintain a competitive edge with similar type businesses in my area. To do this I need to shop them, check their prices and their service. Can I write this off as research & marketing on my taxes, or is their any other fashion to go about doing this?

Answer 1

Any reasonable and necessary expense incurred in the generation of taxable income is a legitimate business expense. If you can tie those expenses to the generation of profit then they are fully deductible as legitimate business expenses.

Just be SURE that you have full documentation and can show the link to the generation of income. If it looks like a boondoggle, the IRS will disallow it in a heartbeat.

Answer 2

This is a very questionable item. If you have a sizable income and expense this but still have a gain you may not have a problem. If you do this with a small income and produce a sizable loss I would suggest that you go down to the IRS office every day and wait for them to call you name for the audit.