Should I Hire A Professional?
Posted by admin on Aug 4, 2008
You may work from home part time. Or, you may work from home full time, but do not make a large profit. In either case, you may not be able to consider hiring a tax professional to handle your tax planning. The question you should be asking, though, is can you afford not to? There are hundreds of different tax deductions your small business may qualify for and without having the knowledge of what they are, you may be paying Uncle Sam more than you need to.
If you really do not feel that you can afford to deal with a tax professional, at least take some small business tax courses yourself. These are available online and locally. This way, you have a better understanding of what you should be paying for your business income in the way of taxes. Hiring a professional is a good thing, though. In most cases, you can write off their costs as a business expense anyway!
I Don’t Have A Receipt For My Expense
Posted by admin on Jul 28, 2008
Far too many small businesses fail to write off enough of their business deductions because they do not have a receipt for it. For example, in the course of your day, you may have paid for a bus ride across town to meet with a potential client. Then, you went to a seminar or trade show regarding your business and you may even have had a cup of coffee at your office shop. Each of these costs is deductible even if you do not have a receipt.
When you make purchases that do not require a receipt to be handed to you, do one of two things. First, ask for a receipt whenever possible. When this is not possible, use your planner or date book to make simple notes in it, telling the date, location, amount and reason for the purchase. This can serve as your receipt for your business expenses.
Around The Office Deductions
Posted by admin on Jul 21, 2008
Most businesses miss a handful of donations that are quite common. Just take a look around your office and you may find some that are considered write offs. On your desk, you may notice your bank statement for your business. Take a look at it. Those fees on there are able to be written off as a business expense. Do you provide internet service for your business? If it is used solely for your business, online computer services are deductible, too.
There is a stack of bills and mail to go out. Did you write down the cost of postage as a business expense? Do you provide your visitors with books and magazines to read while they wait for you? Those too are business expense deductions. Do you have to pay for parking for your vehicle or parking meters outside? Yes, those too are deductions.
Sponsor A Local Little League Team And Write It Off
Posted by admin on Jul 15, 2008
Did you know that many of the costs of advertising your business are tax deductible? There are hundreds of ways to advertise of course, so does that mean that you can deduct just about anything and get the tax benefit from it?
Be careful here. In order for something to be considered a tax write off towards your business income, it must be directly related or benefiting to your business. So, if that little league team comes in wanting you to sponsor them, consider it. If they will allow you to add your business name to their jerseys go for it because this is considered a method of advertising and therefore is fully deductible.
There are many other situations in which this same scenario can play out. The key is to make sure that the cost is directly related to your business in some manner.
Can Taxes Be Deducted?
Posted by admin on Jul 4, 2008
In many cases, the taxes that you pay on your business are generally deductible. But, not all taxes are deducted in the same way. For example, sales tax on the items that you buy for day to day operations are deductible because they are part of the cost of the item. But, you cannot deduct them separately. If you purchase something large that needs to be depreciated over time, then the cost of the tax is added to the cost of the car and depreciated along with the car’s cost.
If you pay federal income tax on business income, this is not deductible, ever. Your state income tax may be deducted from your federal tax return, but only as an itemized deduction. This cannot be done as a business expense. Do take the time to know tax laws regarding deductions of taxes themselves. They can be complex.
Upgrading To A New Set Off Office Furniture? Get A Deduction, Maybe
Posted by admin on Jun 28, 2008
It is often the case that needs, styles and function change in the workplace. If you have invested heavily in computers that are now outdated and you want to get something back from them, consider upgrading to a new computer, and filing it as a deduction.
Consider giving your old furniture, computers or other tangible items that are still useful away. Donations like this can help you to help someone else, but they may also qualify as tax write offs, too. In fact, many businesses are able to write off these costs as upgrading is required.
Be careful though. If you have already written off, or fully depreciated the cost of this furniture on previous returns, you will not be able to claim a deduction on it any longer. Talk to your tax professional about local areas that will qualify to provide this type of donated benefit to you.
Have To Move For Your Business?
Posted by admin on Jun 15, 2008
Many people today are moving from one place to the next for their employment, mainly because people have to be where the work is. Good thing that you can deduct some of these expenses as deductions. In most cases, this would have been a nondeductible cost, but if your employment requires the move, then you may be able to take advantage of a deduction.
In order to qualify, you will need to make certain the costs are acceptable. For example, the move has to be because your employment. What’s more, your new workplace must be at least 50 miles from where your old one is located.
Both employees and business owners can get this deduction, but you do not report it as a small business expense. Rather, there is a line on Form 1040 that you will use. Be sure to keep a record of all of the costs you are adding here to the move.
The Top 10 Deductions Your Business Should Be Taking
Posted by admin on Jun 11, 2008
Are you unsure that you are getting all of the small business deductions that you should be getting? If so, then consider what the top ten deductions for small business are and find out if you are applying for them.
First, the most overlooked is that of car deductions such as traveling to business meetings and other business related activities. Next, office expenses should be noted. This includes everything from your office furniture to the utilities that it takes to keep it running. Business travel is another consideration. Remember that you get 100 percent deduction for your travel and accommodations and another 50 percent on your meals. Meals and entertainment are just as important there. Depreciation, rent for equipment and tools, and supplies are also deductions you may miss.
The others include legal and professional services, insurance and business start up costs.
Using Your Child In Your Business? Write It Off
Posted by admin on Jun 10, 2008
There are several ways to benefit from employing your child in your business. First, in order for this to happen, you must be a sole proprietor or be in a partnership where you and your spouse are the only partners. Then, if you hire and employ your children for you, you can deduct their salary as a business expense. Those under that age of 17 do not file for Social Security, giving you even more of a benefit. If you have a corporation, though, the corporation is employing them, not you and therefore this means the corporation is not relieved of these tax liabilities.
To take this even further, have them contribute to a Roth IRA which will allow a nice tax deduction from their salary and will provide a benefit to them later in life. Of course, you must set this up legitimately.
Having Trouble With Business Calls As Deductions From Home?
Posted by admin on Jun 4, 2008
It can be difficult for anyone to keep track of the costs of telephone conversations especially in this day and age of cell phones. Yet, those that receive calls at their home regarding business, especially if you have your home office there, can easily deduct these costs as business expenses at tax time. But, how will you keep track of it all?
One simple way to do this is to look over your phone bill when it arrives, circle any and all business calls on it, and then keep that bill. At the end of the year, use all 12 of the year’s bills to tally up the amounts. Then, apply this to your business deductions. You get 100 percent deduction on these business expenses. Keep it simply by storing all of your tax related records together throughout the year.