It must not be entered into before the payment is actually made. The payback agreement must not be included in the general corporate bylaws rather than in a specific contract with a employee. Taxpayers use care in timing the realization of items of income and expense. Right, because if an activity has shown a profit in only two out of the previous four years, a taxpayer may consider accelerating some of the income into the fifth year or deferring some of the expenses of the activity into the following year. Right, because it merely compels the IRS to prove that the activity is not a business.
Gross income exceed the deductions from the activity in a least three out of five consecutive years.
Right, because the activity is presumed to be a business, and the limits on the deductibility of expenses do not apply. All of the above are correct. The tax preparer. These expenses are costs a taxpayer incurs in reviewing and analyzing a prospective business before deciding to acquire or create it Analyses and surveys of markets. Traffic patterns, products, labor supplies, and distribution facilities .