I HEARD ABOUT THIS THING CALLED A RECESSION AND DECIDED NOT TO GET INVOLVED.
We have all been over inundated with the news of a bad economy. Many people have lost their jobs due to layoffs and downsizing, the unemployment rate is up, and many have also lost their homes. Many people are struggling to make ends meet and just get by. The banks are even broke. So, in this day and age of doom and gloom, is there any good news? YES! It is the upside of down.
What is amazing is in this time, many people are partnering up and searching for their own home based businesses. Many people in which I have witnessed are saying they don’t need corporate America to make a living and have a career. What we are seeing across the country is the return of the Entrepenereal spirit and the ingenuity that made this country the great place it is today.
Did you know There were more new businesses and new inventions during the Great Depression than in just about any other time in North American History. This is proof positive you just can’t keep a good man (or woman down). This, to me, seems to be one of the best times for the public to create a self reliant source of income ,during what many are calling a depression .
There is also a new sense of community that is being born along with this new wave of small businesses. Everyone knows someone who owns their own small business; they are our friends, family and neighbors, and we are wanting to support them. Across the country people are going to their neighborhood diner instead of the big chain, the local bookstore or local roofer because people once again want to support the others in their community that have been hit the hardest by the recession and economy.
So what is the upside of down? A feeling of I can do this we can make it happen by reaching deep down inside and saying we can do it ourselves. The old saying that it takes a village not only pertains to children, but to the village itself. And for the first time in a long time, communities are supporting each other.This I would call the birth of social marketing the old addage like our grandfathers used to do business, hand to hand, belly to belly, face to face.This was when a hand shake meant something iron clad deal so to speak . T.B.C.
GOOD LUCK YOU CAN DO THIS !
Never "for the sake of peace and quite" deny your own experience or conviction
.
Friday, November 6, 2009
Tuesday, October 20, 2009
When opportunity knock's you better answer .
What Kind Of Tax Advantages Do Home-Based Businesses Opportunist Enjoy?
You have probably thought of many of the benefits of running your own successful home based business. From the independence of working for yourself to making better income than you may currently make, there are many reasons that starting a home-based business might be right for you. One consideration that you might not have taken into account is the tax advantages that you will enjoy with a business run out of your home. Let's explore these qualifying deductions, starting with the better-known ones.
The Home Office Deduction The deduction that likely comes first to mind that home-based businesses can take advantage of is the "Home Office Deduction". The Home Office Deduction allows you to deduct some or all of the expenses of your office at home and related expenses.
To qualify for this deduction, your home office must be the principal place where your business is done. Secondly, the office space must be used exclusively for business use to qualify. For example, if you use your kitchen as your primary workspace, it is likely that you cannot take the home office deduction, assuming that you use it for personal use as well. To be on the safe side, set aside a room as your home office where possible. This will keep you on the safe side should the home office use ever come into question.Detailed explanations of who qualifies for the Home Office deduction are defined in detail by the IRS or Revenue Canada themselves.
Building-Related Expenses Repairs and improvements to your home office are completely deductible. For example, painting your home office is an expense that relates directly to doing business out of your home, so it is deductible in full.
Mortgage interest is deductible as a percentage of the total mortgage paid for your home. For instance, if your home office makes up 200 square feet of your home's 2,000 square feet total, you can write off up to 10% of the mortgage interest for your home as a business cost. Similarly, if you rent your home, the percentage of your home used exclusively for business use would also be deductible.
Property taxes paid for your home also qualify at the same percentage rate as the mortgage.
Furthermore, if you own your home, you can depreciate the appropriate share of the home over 39 years.
Note : That home expenses not related to your business, such as landscaping costs, cannot be deducted, even if you are beautifying the appearance of your home to enhance its appearance for business purposes. Some rules may apply different such as building a brick path to the private door of your office,however it is always best to confirm with a CGA .
How Much Total Can You Deduct? You can deduct at most in home expenses for your home-based business what it's net profit is. Thus, if you don't make much net profit, neither will you be able to deduct many home office expenses. This covers expenses specific to your home itself, such as mortgage/rent and property taxes.
Security You may deduct the business cost of security devices and monitoring fees as a percentage of the protected area used for business use of the entire protected area (normally the entire home). This is considered an indirect cost of doing business.
Insurance
If you own your home and pay home owner's insurance, you may deduct a percentage of that expense, as with mortgage or rent expenses. If you have additional insurance coverage that covers things specifically for the business, you may deduct these expenses in full as direct business expenses. This may include special riders on your insurance policy to protect business equipment used exclusively for your business.
Additionally, if you incur a loss that is not covered by insurance, if it is equipment used exclusively for your business, you can deduct the entire loss. If the property lost is for things used both for personal and business use, you may deduct just the percentage of business use.
Utilities.Using the same percentage that you can write off of your home calculated above, you can write off utilities such as electrical, gas, and other utilities as business expenses.
Transportation/Travel If you work primarily out of your home, you can typically write off the transportation expense of getting to and from your clients' places of business and other business-related transportation costs. Transportation as a deductible cost is one area where detailed records is critical. Typically, you will want to record the odometer mileage of your car before and after your trip to determine the number of miles traveled. Alternately, if you have places that you often travel to, you can just record the number of miles once and then multiply by the number of trips to determine total mileage This will prove much easier than recording each trip's mileage .Cost of ,conventions,seminars that include or you need to fly to the destination are also covered under this option including "work holidays" .Make sure proof of business is involved before claiming this deduction .Cheating the system could cause you a world of heartache down the road .This could be concluded of one of those grey area's.
Moving Expenses if you move, you can deduct the business portion of the move. For example, if half of the items to be moved were business-related, you could deduct 50% of your moving expenses. Note :that moving expenses apply to sole proprietors,
Phones/Communications/Internet For a home business, Additional phone lines for business use, including cell phones used for your business, are tax deductible. Internet service provider fees or broadband costs such as high speed cable connections are deductible as a percentage of business use to total usage.
Meals and Entertainment If you take a client or prospective client out to lunch and talk about your business, it is often tax deductible as a cost of doing business. If you are doing business out of town or at your convenience on a business-related task, you can typically deduct the amount of meals. If you are entertaining a client, the expenses related to the meeting are deductible if they have a business purpose.This would include in home business meetings.
Careful Meals and Entertainment is one area that is often abused by small/home businesses, so if you plan to take deductions for these kinds of expenses, be sure to keep receipts. Also keep records of what the money was used for to avoid any kind of legal entanglements later on. As with most business deductions, as long as you stay within the IRS/REV CAN guidelines for what is allowed and keep good records, you can take this deduction safely.You can only deduct 50% of the cost of meals and entertainment.
Tax Preparation Expenses Though not specific to home-based businesses, the expenses that you incur to have your tax return itself prepared may be tax deductible. Also, if you use tax-preparation software to prepare your own business' tax returns, the cost of the tax preparation software is possibly deductible. In my opinion always use a certified Accounting firm .
Software used for business purposes are deductible as a business expense. Note that for software packages in excess of $500 in value, you may need to amortize (write off over a period of time) the software over 3 years. If you have purchased software that costs more than $500 per piece of software, consult the IRS/REV CAN guidelines for software deductions.
Educational Expenses incurred directly to learn industry-specific skills needed for your business are often tax-deductible. For example, if you purchase the Professional Bookkeeper course to learn Accounting and Bookkeeping skills to start your business, this expense is tax deductible as a start up cost once your business is underway.
Record Keeping
Many small and home base businesseslet themselves get cheated every year by not taking deductions they are legally entitled to on their taxes for fear of being audited. As long as you stay within the IRS/REV CAN guidelines for what is and is not tax deductible and keep receipts and good records, you are safe to take the deductions you are legally entitled to. The Home Office Deduction in particular is a deduction that many have wrongly assumed makes them a target for an IRS audit.
If ever in doubt, go directly to the source, the IRS/REV CAN themselves. They publish many articles defining exactly what deductions you are entitled to so that you can be sure that you are in compliance with the law. It may be advisable to consult a professional tax preparer or accountant for specific questions regarding what would or would not be deductible, and to what extent.
A Great Home Business as illustrated above, there is obvious advantages to running a home based business . One of the best home-based businesses made available in many different variations is that of the direct or networkmarketing industry which can be obtained at very low start up costs . What you make will absolutley depend on your time and devotion towards your opportunity. In my opinion there is absolutly nothing wrong with direct or network marketing, in fact most people network market all day long and dont get paid for it.
Consideration's before choosing your perfect home based business
1) Products :whether you decide on the health and wellness,cosmetics,home accessories,pick a product or service you are most comfortable with .Take time to study and analyze what's best for you and brings you the best level of comfort when sharing the opportunity with friends, family and the outside world .
2) Managment :is a very key factor when choosing a company that may potentially be a life changing experience for you and your family.Use the internet to look for information on managment such as past experience,education etc dont be afraid to call the company direct and ask to speak to co-orporate or members of council .I know I did
3) Leadership/Mentorship: local or distant is extremly important as you are basically choosing your partner in business and you will certainly have to rely on mentorship or affective partnership to help build your business .Question to ask yourself what qualifications experiences do these leaders have that are goin to help expand your home business?
You have probably thought of many of the benefits of running your own successful home based business. From the independence of working for yourself to making better income than you may currently make, there are many reasons that starting a home-based business might be right for you. One consideration that you might not have taken into account is the tax advantages that you will enjoy with a business run out of your home. Let's explore these qualifying deductions, starting with the better-known ones.
The Home Office Deduction The deduction that likely comes first to mind that home-based businesses can take advantage of is the "Home Office Deduction". The Home Office Deduction allows you to deduct some or all of the expenses of your office at home and related expenses.
To qualify for this deduction, your home office must be the principal place where your business is done. Secondly, the office space must be used exclusively for business use to qualify. For example, if you use your kitchen as your primary workspace, it is likely that you cannot take the home office deduction, assuming that you use it for personal use as well. To be on the safe side, set aside a room as your home office where possible. This will keep you on the safe side should the home office use ever come into question.Detailed explanations of who qualifies for the Home Office deduction are defined in detail by the IRS or Revenue Canada themselves.
Building-Related Expenses Repairs and improvements to your home office are completely deductible. For example, painting your home office is an expense that relates directly to doing business out of your home, so it is deductible in full.
Mortgage interest is deductible as a percentage of the total mortgage paid for your home. For instance, if your home office makes up 200 square feet of your home's 2,000 square feet total, you can write off up to 10% of the mortgage interest for your home as a business cost. Similarly, if you rent your home, the percentage of your home used exclusively for business use would also be deductible.
Property taxes paid for your home also qualify at the same percentage rate as the mortgage.
Furthermore, if you own your home, you can depreciate the appropriate share of the home over 39 years.
Note : That home expenses not related to your business, such as landscaping costs, cannot be deducted, even if you are beautifying the appearance of your home to enhance its appearance for business purposes. Some rules may apply different such as building a brick path to the private door of your office,however it is always best to confirm with a CGA .
How Much Total Can You Deduct? You can deduct at most in home expenses for your home-based business what it's net profit is. Thus, if you don't make much net profit, neither will you be able to deduct many home office expenses. This covers expenses specific to your home itself, such as mortgage/rent and property taxes.
Security You may deduct the business cost of security devices and monitoring fees as a percentage of the protected area used for business use of the entire protected area (normally the entire home). This is considered an indirect cost of doing business.
Insurance
If you own your home and pay home owner's insurance, you may deduct a percentage of that expense, as with mortgage or rent expenses. If you have additional insurance coverage that covers things specifically for the business, you may deduct these expenses in full as direct business expenses. This may include special riders on your insurance policy to protect business equipment used exclusively for your business.
Additionally, if you incur a loss that is not covered by insurance, if it is equipment used exclusively for your business, you can deduct the entire loss. If the property lost is for things used both for personal and business use, you may deduct just the percentage of business use.
Utilities.Using the same percentage that you can write off of your home calculated above, you can write off utilities such as electrical, gas, and other utilities as business expenses.
Transportation/Travel If you work primarily out of your home, you can typically write off the transportation expense of getting to and from your clients' places of business and other business-related transportation costs. Transportation as a deductible cost is one area where detailed records is critical. Typically, you will want to record the odometer mileage of your car before and after your trip to determine the number of miles traveled. Alternately, if you have places that you often travel to, you can just record the number of miles once and then multiply by the number of trips to determine total mileage This will prove much easier than recording each trip's mileage .Cost of ,conventions,seminars that include or you need to fly to the destination are also covered under this option including "work holidays" .Make sure proof of business is involved before claiming this deduction .Cheating the system could cause you a world of heartache down the road .This could be concluded of one of those grey area's.
Moving Expenses if you move, you can deduct the business portion of the move. For example, if half of the items to be moved were business-related, you could deduct 50% of your moving expenses. Note :that moving expenses apply to sole proprietors,
Phones/Communications/Internet For a home business, Additional phone lines for business use, including cell phones used for your business, are tax deductible. Internet service provider fees or broadband costs such as high speed cable connections are deductible as a percentage of business use to total usage.
Meals and Entertainment If you take a client or prospective client out to lunch and talk about your business, it is often tax deductible as a cost of doing business. If you are doing business out of town or at your convenience on a business-related task, you can typically deduct the amount of meals. If you are entertaining a client, the expenses related to the meeting are deductible if they have a business purpose.This would include in home business meetings.
Careful Meals and Entertainment is one area that is often abused by small/home businesses, so if you plan to take deductions for these kinds of expenses, be sure to keep receipts. Also keep records of what the money was used for to avoid any kind of legal entanglements later on. As with most business deductions, as long as you stay within the IRS/REV CAN guidelines for what is allowed and keep good records, you can take this deduction safely.You can only deduct 50% of the cost of meals and entertainment.
Tax Preparation Expenses Though not specific to home-based businesses, the expenses that you incur to have your tax return itself prepared may be tax deductible. Also, if you use tax-preparation software to prepare your own business' tax returns, the cost of the tax preparation software is possibly deductible. In my opinion always use a certified Accounting firm .
Software used for business purposes are deductible as a business expense. Note that for software packages in excess of $500 in value, you may need to amortize (write off over a period of time) the software over 3 years. If you have purchased software that costs more than $500 per piece of software, consult the IRS/REV CAN guidelines for software deductions.
Educational Expenses incurred directly to learn industry-specific skills needed for your business are often tax-deductible. For example, if you purchase the Professional Bookkeeper course to learn Accounting and Bookkeeping skills to start your business, this expense is tax deductible as a start up cost once your business is underway.
Record Keeping
Many small and home base businesseslet themselves get cheated every year by not taking deductions they are legally entitled to on their taxes for fear of being audited. As long as you stay within the IRS/REV CAN guidelines for what is and is not tax deductible and keep receipts and good records, you are safe to take the deductions you are legally entitled to. The Home Office Deduction in particular is a deduction that many have wrongly assumed makes them a target for an IRS audit.
If ever in doubt, go directly to the source, the IRS/REV CAN themselves. They publish many articles defining exactly what deductions you are entitled to so that you can be sure that you are in compliance with the law. It may be advisable to consult a professional tax preparer or accountant for specific questions regarding what would or would not be deductible, and to what extent.
A Great Home Business as illustrated above, there is obvious advantages to running a home based business . One of the best home-based businesses made available in many different variations is that of the direct or networkmarketing industry which can be obtained at very low start up costs . What you make will absolutley depend on your time and devotion towards your opportunity. In my opinion there is absolutly nothing wrong with direct or network marketing, in fact most people network market all day long and dont get paid for it.
Consideration's before choosing your perfect home based business
1) Products :whether you decide on the health and wellness,cosmetics,home accessories,pick a product or service you are most comfortable with .Take time to study and analyze what's best for you and brings you the best level of comfort when sharing the opportunity with friends, family and the outside world .
2) Managment :is a very key factor when choosing a company that may potentially be a life changing experience for you and your family.Use the internet to look for information on managment such as past experience,education etc dont be afraid to call the company direct and ask to speak to co-orporate or members of council .I know I did
3) Leadership/Mentorship: local or distant is extremly important as you are basically choosing your partner in business and you will certainly have to rely on mentorship or affective partnership to help build your business .Question to ask yourself what qualifications experiences do these leaders have that are goin to help expand your home business?
4) Compensation plan: I know you wanna get paid ,therefore take time to go over the compensation plan that any company is offering, believe me there are major differences in some that go from zero to hero including fabulous perks such as cars,expence accounts and vacation give aways not to mention great cash/commission return on your hard work . Ask the question's when do we get paid? how do we get paid ? have your mentor/sponsor go over in detail the benefits of the comp plan offered by the company .
5) Company History Question's to ask, Who is the company ? How many years in business ? and Were do they practice business? Remember with the power of the internet you can take your home based business global and reach the world within minutes. This gives you the opportunity to make money while you sleep .Again, don't be afraid to call around and ask for references or ask questions to other members who may or used to belong to this organization . BE ANAL ! it's your time,money and most important your future .
I wish you the best of luck on your new venture and I hope you become a victom of your own success YOU CAN DO IT !
Your Friend and Student
Cory Anthony
Subscribe to:
Posts (Atom)
