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03 - Accounting & Taxes Accounting Help & Tax Strategies

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Old 12-04-2008, 08:02 AM
lelepu lelepu is offline
Join Date: Sep 2008
Posts: 72
Default Accounting for prepaid Insurance in QB

As S Corp I buy General Liability and Worker Compensation Insurance policies that are one year policies with the policy term not coinciding with my fiscal/ tax year (I am forced to buy Work comp policy even though I am the single owner employee since my client insists so; it is money down the drain).

At the end of the tax year, I deduct the portion of the premium for the policy term in that tax year as a deductable insurance expense and carryover the rest of the premium as a current asset in my balance sheet to the next year. I write it off completely when the policy term ends and start the cycle again for the next policy term.

Is this practice correct or are there other alternatives? Any issues?

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Old 09-06-2012, 02:01 AM
adrian_in9@yaho adrian_in9@yaho is offline
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Default re

The Baltimore Life Insurance Company has served seven generations of policyholders. Baltimore Life has made its name through the years by building and preserving high-quality assets.
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