February 24, 2010

What can be deducted as an investment expense on your tax return?

Well, if you itemize your deductions, you can include investment expenses under miscellaneous itemized deductions on schedule A. Unfortunately, your miscellaneous itemized deductions have to exceed 2% of your adjusted gross income before they benefit your tax return. The investment expenses may include:

  • Safe deposit box rental.
  • Investment subscriptions (Wall St. Journal, etc.)
  • Long distance calls to your financial advisor.
  • Taxi rides to your Brokers' office, or parking fees.
  • Fees for investment advice.
  • Management fees.
  • IRA fees if paid from outside the account.
  • Investment classes or seminars.
  • Custodial fees.
  • Record-keeping expenses to track investments.
  • Investment research expenses.
  • Books on investments.
  • Tax preparation fees.
  • Taking your tax accountant out to lunch to discuss your tax situation (of course this is my favorite deduction of all!!)
There are some investment expenses that are accounted for elsewhere in the tax return.

Brokerage commissions are deducted from proceeds on schedule D, and margin interest, to the extent of investment income is deducted as interest on schedule A.

I am available for lunch starting April 17th.......

(This article contains the current opinions of the author but not necessarily those of Brighton Securities Corp. The author's opinions are subject to change without notice. This blog post is for informational purposes only. Forecasts, estimates, and certain information contained herein should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. References to specific securities and their issuers are for illustrative purposes only and are not intended and should not be interpreted as recommendations to purchase or sell such securities).