|
|
| Tax Deduction Information |
|
|
|
|
Home Business Legalities And Tax AdvantagesDean Phillips Even if you work out of your home, most cities and/or counties require you to have a business license and/or permit. Check with your local government municipalities to find out what the requirements are for where you live. Depending on where you live, you should be able to get this information from your local courthouse or townhall. Zoning may also be an issue. Municipal ordinances can be very restrictive about what types of businesses are allowed in a residential district. This also applies if you plan on placing a sign outside of your home. Again, check with your local government municipalities to find out what the requirements are for where you live. In addition, depending on how your home business is structured--as a sole proprietorship, partnership or corporation--there may be forms to file with the state. The legal structure affects taxes and the liability of the owner and the home business, so its important to follow the appropriate procedures. Contact your states Department of Revenue for filing fees and information. If you plan to operate your home business under a name other than your own, you will have to register a fictitious name with the county--usually referred to as a DBA filing Doing Business As. The exceptions to this regulation are corporations and partnerships doing business under the umbrella of the corporate or partnership name. As a home business owner, you may be required to file estimated tax returns and pay estimated taxes quarterly. If you have employees, you also have to submit taxes withheld from employee paychecks. Here are some of the taxes you may be responsible for: Employment taxes -- Federal income taxes, Social Security and Medicare, federal unemployment and state income taxes. Federal self-employment tax--Required by those who work for themselves to cover Social Security and Medicare contributions. Sales tax--Each state requires a sales tax number for any company involved in selling tangible items. Sales tax is collected, reported and paid to the state either monthly or quarterly. Unemployment insurance tax -- You are required to pay federal and state unemployment taxes if you have more than one employee on the books for at least 20 weeks in a calendar year, or if they have paid more than $1,500 in gross wages in a calendar quarter. Again, check with your states Department of Revenue for more information. A home business qualifies for all of the same tax deductions regular businesses do. In the eyes of the IRS, the only difference between most home businesses and Fortune 500 Companies is their size, and the fact that home businesses can also deduct many household and living expenses. Owning a home business will entitle you to deduct thousands of dollars in every day expenses. After all, why pay more in taxes than you have to Listed below are just some of the items you are allowed to deduct:
NOTE: To qualify for the above tax deductions, you must be actively working your home business. In closing, since tax laws are continually changing, I highly recommend you consult with your accountant or tax advisor to learn more about applying the aforementioned deductions to your home business.
|
|
|
|
RELATED ARTICLES
Keep More of What You Make - Start A Home-based Business The best advantages of owning a home-based business are you can turn non-deductible expenses into tax deductions. The deductions you create for your Schedule C have a more significant impact on the total taxes you pay than do deductions on Schedule A. Schedule C deductions not only reduce federal income tax, they also reduce self-employment tax, Medicare tax, and state and local taxes. How To Get An Extension To File Your Business Tax Returns Yes, the tax season is upon with the first filing date for some businesses being March 15, 2005. If you can’t imagine getting your tax returns together by that date, you need not worry. The IRS automatically gives you an extension if your file the appropriate form. As you might expect, there are different forms for different businesses. Small Business Tax Deductions for Year End 2004 As a small business owner, its wise to familiarize yourself with some key deductions that may reduce your tax bill for 2004. What Makes People Move Do you have a new job Want more space Want to own your own home Move closer to relatives Want a change of scene How about - do you want to move away from your relatives Believe it or not, moving away from relatives was the number three reason cited for moving according to a new Internet survey. New Years Resolutions Ah, the start of another year! In a groggy haze on New Years Eve, I promised someone or was it myself that I would be good this year. I said I would draw up my New Year’s Resolutions – particularly after the roller-coaster year I had last year. Well, a promise is a promise. I can’t very well start the New Year by breaking the resolution that I was going to write my New Year’s Resolutions, can I So, here it is, broken down into months being the control freak that I am. Wealth Creation and Mortgage Planning - Two Great Tastes that Taste Great Together What if I were to tell you that almost everything you have been told about what to do with your home has been absolutely wrong and that one of the worst ways to build wealth is through your home And what if I further went on to show you that anyone who perpetuates this myth probably is not your best source for accurate financial information Home Based Business: Your Ultimate Tax Shelter Starting and operating your own home based business is the ultimate tax shelter. The Seven Deadly Tax Sins: Commonly Missed Deductions Its that time again, the April 15 tax deadline is looming large. If youre like most people, you havent gathered all of your tax records, let alone filled your return. Home Business Legalities And Tax Advantages Even if you work out of your home, most cities and/or counties require you to have a business license and/or permit. Check with your local government municipalities to find out what the requirements are for where you live. Depending on where you live, you should be able to get this information from your local courthouse or townhall. The Job Loss Myth Presidential candidate John Kerry is fond of stating that “... not since Herbert Hoover has any president lost more jobs than George W. Bush.” And there is a kernel of truth to the statement; thanks to technology, jobs require less human intervention to complete. However, a larger factor in this seeming loss of employment is due to the evolution of the American workforce from a lot indentured to the confines of one company or one job title toward the Jeffersonian ideal of every person being a free agent, or indie. Five Reasons To Stay Committed To Your Retirement Savings NC—As an investor working to build your portfolio, you face many day-to-day demands on your money. Its not always easy to determine what your financial priorities should be, or to stay committed to them – especially when markets are volatile. 5 Simple Steps: Earn an EASY ROTH-IRA Million!!! So, you wanna earn a million dollars, super-duper easy How would you like the federal government to give you a big, huge tax break Wouldn’t it feel deliciously good to earn a Million Dollars of income, completely tax free How would you like to earn a million dollars of income passively, quietly, without lifting a finger Well, put your seatbelts on, folks, because in a brief nutshell, I’m going to introduce you to the financial vehicle that you’ve been looking for! Welcome to the wonderful world of investing through a ROTH IRA in 5 simple steps: Home-Based Business Owners Save Thousands on Their Taxes Do You Qualify For Home-Based Tax Deductions How to Check the Status of Your Tax Refund Online So, you were pleasantly surprised to learn that you are getting a refund on your taxes. Congratulations! The IRS expects to issue approximately $54 billion dollars in refunds for the 2003 tax year. The question for most taxpayers expecting a return is, "Where is my refund" Turning Your Trash Into Cash Junk. We all have some of it lying around the house. Whether its boxed items cluttering the attic or everyday items that just dont fit with the rooms decorating theme anymore, many of us have more than we need. At some point it all gets to be too much and in a fit of energy we decide that our place needs to be cleaned. Then the junk gets moved, typically to the nearest trash can. But wait. Before you throw out all that stuff, it pays to take head of the saying "one persons junk is another persons treasure." Part 2 of 5 On The Home Business Set-Up Guide Dear Reader, Love Of Reading Can Predict Your Online Success When I was a very small child, I discovered that I had a love for reading. There was nothing better then spending an entire afternoon engrossed in a good novel. Reading for me was a pleasure, and magically transported me all over the world. My love of reading from an early age sharpened my vocabulary skills, my spelling, and my ability to learn, without me even realizing it. Little Known Tax Deductions That Can Save You Big When you say "end of the year", most small business owners think of two things immediately. The *second* is the holidays. The *first* is taxes! While almost all of us pay taxes quarterly, we still have to file in January. That means November and December are spent getting ready. When youre gathering all your information together for your accountant, dont forget about these regularly overlooked deductions. Deadlines Approaching For Filing 1099s For Independent Contractors While the middle of January may seem a bit early to begin thinking about taxes, 1099-MISC filing deadlines are looming for businesses. Generally speaking, IRS 1099-MISC is the form used to report miscellaneous income that you paid to persons during 2004 in the course of your trade or business. Seven Key Tax Deductions for the Self Employed As a sole proprietor, it*s wise to familiarize yourself with the some key deductions that may reduce your tax bill for 2004. Small-business consultants generally recommend that you hire an accountant to prepare your tax returns, payroll and financial statements. But you should also meet with your accountant well before the year-end rush to discuss such matters as tax planning, and record keeping for tax deductions.
|
| home | site map |
| © 2005 |