I am a moderately active investor. I would like to know if purchases of financial books are considered deductible investing expenses.
I also have a personal corporation. Perhaps it would be cleaner to buy such books under the corporate account?
You should post such questions to misc.taxes.moderated. Not only will you be talking to people who know tax law better, but it will also not be off-topic for the newsgroup.
To answer your question unauthoritatively, generally no, financial books are not tax deductible on personal returns. However....
Yes, that would be better.
Technically, you might also get away with a misc deduction on your personal tax return for unreimbursed employee expenses. But that is limited to the excess of 2% of AGI.
FYI, if you look at line 23 of Sched A, it does say "invesment" for "other expenses". But if you look at the instructions, you will see that that means "your share of investment expenses of a regulated investment company".
Expenses associated with the production of taxable income are deductible on Schedule A, but only if you itemize, and only as miscellaneous itemized deductions. Misc. deductions are an annoying category because they are only deductible to the extent they exceed 2% of your adjusted gross income (bottom line on front page of your tax return). So even if you could justify books as valid investment expenses, it's unlikely you'll be able to get any useful deduction from them. If you google "investment expenses" you'll find guidance directly from the IRS about what is and isn't deductible.
Having a personal corporation is a bit meaningless for tax purposes really - you can't use one to turn personal expenses into business expenses. But if books about finance represent a valid business expense, then it would be deductible against the income of the business. I'm in a financial business and have books that I use in my practice, so I have my library on my balance sheet. Though except for subscription-based stuff they're capital assets (depreciation, Sec. 179) rather than expensed items.
As someone said, you'll get better answers on this kind of thing at m.t.m. I thought I'd post because I'll bet many on MIFP spend something on personal finance books, periodicals, etc.
-Tad
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