Question

Cohan Rule— how to use it?

In what ateas if deduction is it prohibited? How to use it?

Answer 1

Cohan rule - The Cohan rule is now a law that allows Taxpayers to deduct some of their business related expenses even if the receipts have been lost or misplaced so long as they are reasonable and credible.    According to Cohan rule, court allows the taxpayer to deduct some reasonable expenses if you have some convincing evidence that you incurred a deductible expense. The court can make an estimate of how much to allow .In addition Cohan rule doesn't apply to expenses for which the tax code requires detailed receipts. If we think that IRS has not allowed to deduct a reasonable estimate of expenses and we think that Cohan rule may apply than we can contact Success Tax Relief today. If we are the subject of an audit and do not feel like the auditor is giving us credit for deductions that are legitimate (but that we don't have documentation to support ) we can certainly bring up the Cohan rule . We also have the right to appeal an audit and raise this issue in court.