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Discussion:Interest expense on payroll tax liability
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Discussion Forum Index --> Basic Tax Questions --> Interest expense on payroll tax liability
Discussion Forum Index --> Tax Questions --> Interest expense on payroll tax liability
ANNE1 (talk|edits) said:
| 28 August 2008
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| Are interest payments paid to IRS on an installment agreement for payroll taxes by a Sub S corp deductible? The reason I question this is in the US Master tax guide 937A which does not allow that deduction on an individuals income tax liability and also says that this rule also applies to an individuals partnership and S corp activities.
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Kevinh5 (talk|edits) said:
| 28 August 2008
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| The argument is 'is this ordinary and necessary'?
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Kevinh5 (talk|edits) said:
| 28 August 2008
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| The IRS has argued "NO", while the pratitioner argues that "financing from some other source would generate deductible interest expense, why not financing from the government?"
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Riley2 (talk|edits) said:
| 28 August 2008
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| Should be fully deductible. I believe the Redlark appeals court decision applies only to personal taxes.
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ANNE1 (talk|edits) said:
| 28 August 2008
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| I agree with Riley2. Publication 535 page 12 states it is fully deductible. Sorry I skipped that publication before asking the question.
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