| How to Slash Your Taxes with a Work From Home Business |
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How to Slash Your Taxes with a Work From Home Business by Debbie Amon For people who are also still employed and are doing a work from home business on a part-time basis, you can start reducing your tax burden immediately. For a single person saving $3,000 is well within reach, and for a family of four that amount can easily exceed $7,000 according to ‘The Tax Times’. It is like receiving an increase to your income simply by maximizing your tax deductions. Tax professionals who specialize in home based businesses know of over 200 legal tax breaks you can take advantage of. The key to maximizing your deductions is knowledge of what the IRS permits, and taking the time to religiously keep the proper records and receipts. The good news is that this information is readily available and that the record keeping only takes a minute or two a day I will summarize the 6 most popular home based business tax deductions here: 1. Automobile When driving for you work from home business you can deduct close to 49 cents a mile from your taxes. Anytime you go somewhere, even to the grocery store, if you engage in business activity such as handing out a business card, flyer or CD your mileage is tax deductible. Keep a supply of prospecting materials in your car. More tax deduction opportunities include a stop to the printers or office supply store. Simply keep a notebook in your car to record your mileage and the business activity you are engaged in. Leasing your vehicle can bring a much greater write-off than if you own your vehicle. 2. Business Travel When traveling to attend a business meeting, convention, seminar etc.; your plane fare, lodging and more are all legal tax deductions. Many savvy business people combine business travel with vacation time and write the bulk of the trip off. The only requirement is that more than 50% of your time be invested in business related activity. 3. Home Office & Business Supplies: Whether it is a spare bedroom or the dining room table, if you spend about an hour a day at least four days a week in your office at home you can deduct a portion of many of your home expenses. In addition, things like equipment for your office (computer, copy paper, pens, furniture, etc) are all tax deductions. Adding things like a second phone line or high speed internet access is standard stuff for a home based business entrepreneur. Don’t forget about business cards, stationery or marketing materials. 4. Entertainment & Meals: Most any meal out in which you discuss your work from home business with another person can be a business expense which allows you to deduct 50% of the cost of the meal, and tip. These meals can be with any prospect including your friends, family, as well as the prospects you've just met. If you want to entertain customers, or potential prospects from home those expenses can be deducted up to 100%. 5. Medical: Imagine being able to write off all your medical and dental expenses, your health insurance premiums and eye care needs. This one benefit alone makes owning a home based business a no brainer. It is also another good reason to hire your spouse and children to assist in your home business enterprise because it can extend these benefits to your entire family. Your spouse can reply to emails, pay bills, discuss marketing strategies, your kids can stuff envelopes, put paper in the printer - you get the idea. 6. Education, Dues & Subscriptions Tax deductions can be taken for continuing education expenses that are related to your business. This education could include not only learning more about your business product or service but also how to market or build your business, computer training, hiring a business coach, etc. Membership dues for professional associations, this could include a local or national networking group. Subscription costs for professional and trade publications in print, audio or video. In closing; for the amazing tax deductions alone, if you are not involved in a work from home business you are literally throwing money out the window! (This article is not legal tax advice. Consult with a tax professional that specializes in small business and educate yourself with information from people like Sandy Botkin or Thomas Stemmy CPA to make sure your getting all the deductions you are legally entitled to – it is well worth your time.) Businesswoman, Friend, and Team player Debbie Amon assists Entrepreneurs to be success stories and inspiration to others. The fact that you are investigating the home-based business industry is a sign that you have dreams and trust in those dreams. Let me assist you: Go to my website and register for the FR.EE newsletter and receive a copy of the FR.EE “Building Business Report”.Visit: Entrepreneur Article Directory: http://www.articledashboard.com |
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