Andrea Bonaccorsi, CPA 
Manager, Tax Services

Apparently actor Nicolas Cage can't, at least according to the IRS. Cage is accused of wrongly deducting more than three million dollars in personal expenses―including meals, gifts, travel, and even his private jet!

Some of Cage's disputed deductions were claimed on his personal tax return, others on the return for his business, Saturn Productions. The IRS also considered the disallowed Saturn Productions deductions to be salary and dividends to Cage, and therefore taxable on his personal return.

All told, the IRS claims that he owes nearly two million dollars in taxes and penalties. Cage's business manager claims that the expenditures are deductible business expenses because they are customary in the entertainment industry.

Who's right? If you're not always sure of the difference between personal and business expenses, it seems you're in good company.

Click Full Article to learn more about the rules for deducting business expenses.