Why is it a good idea to start a home business? Taxes. There are a lot of tax deductions that help lower your tax bracket. Working from home is a great way to make money, save money and keep your money.
1. If you have to order every month in order to receive your check then the products are deductible.
2. Start up costs, like memberships are deductible.
3. Utility costs are deductible. Keep in mind only a percentage is deductible. (ex. electricity, phone and cell phone, internet service, water, sewer and garbage, rent/mortgage and house repair. Only deduct how much you use for business purposes.
4. Office supplies. (ex. Pens and paper, computer, printer, adding machine, enrolling forms, chairs, desk and etc)
5. Advertising for your business. (ex.logo products/company literature, seminars/Trainings (CDs / tapes), books, product samples/Newspaper ads, flyers/gifts and website fees)
6. Mileage (if you drive to meetings or drop off products to others)
7. Meals (ex. restaurants discussing your business, providing food while discussing your business at home.)
8. Any out of town business expenses. (ex. airfare/hotel/all fees related to traveling, some meals and entertainment expenses (subject to some rules and limitations)
9. Operating expenses (ex. fees to receive reports on your active business, postage, in-home expenses, snacks/tea/coffee/samples, demonstration supplies and cleaning your office.)
These are just a few deductions that benefit having a home business. Depending on the business you chose depends on how many you use. For the most part my suggestions are used for any home business. Consult a tax advisor before using these to make sure they apply to your business and what percentage to deduct.
With anything related to taxes, keep receipts. Keep legible records of all activities in your business.
Taxes are a very complex issue. The above information is to advise and educate you. These may or may not apply to you and your business.
Suggestions:
1. Use a tax advisor or computer tax program (Turbotax)
2. Keep all records neat and in order. You will pay less for the tax advisor when put your records in order and it will be easier for you if you do this on your own.
3. Raise your knowledge of tax advantages that apply to your business by listening to others in your business. That way you can give your tax advisor some ideas of what your business entails.
Keep in mind any books/CDs or information related to your business is deductible. Knowledge is your best tool. I hope this helps you. |
