Tax Tips and Planning Strategies For Online Home Business Success

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Tax Tips, Online Home Based Business Article –

10 Tax Tips and Planning Strategies
for Your Online Home Based Business

Tax tips can save you a lot of frustration, aggravation, and money.

April is tax time, but now is the time to start planning for next year. This post covers tax tips for you to follow for your online home based business to prepare you for the next tax season.
Tax Tips
I know some of you are just getting started with your online home based businesses or thinking about starting one. These business tax tips for your home based business should be helpful to you.

I recently listened to recordings by Rhonda Johnson, a business income tax expert. I’ll share some of her tax tips and planning strategies in this article.

Rhonda stated that we must treat our business like a business, so that it will pay us like a business.

She shared the following tax tips and planning strategies:

1. In many cases, you don’t need to show a profit to deduct business expenses. However, if you continue to show a loss for too many years, you may get asked why you are continuing to do the business.

2. The biggest tax mistake people make is not keeping good records. She recommends we use a simple system for keeping records like the one at http://www.igniteyourfinances.com. You may need to keep your records from 3 to 7 years, depending on the type of business, and you can choose to scan your records into your computer.

3. Be sure to have a checking account that is designated for your business. This does not have to be a business account, because banks will often charge added fees for a business account.

4. Have a business-designated credit card.

5. You may be able to deduct 100% of meals, gym memberships and golf memberships if you use them for promotional or networking purposes for your business.

6. In most cases, you should put aside 20% of your income to cover business income taxes.

7. Business education and development is deductible, as long as it is not done in excess.

8. Audits typically look for unclaimed income or excessive use in any given category.

9. If including mileage, keep good records and be sure to make the first stop business-related.

10. Let your insurance company know that you have a home based business because if they find out afterward you need to make a claim, they may not pay for business-related items.
Tax Tips
Please refer to Rhonda’s material from her website for more tax tips or consult your accountant.

Did you find these business tax tips and planning strategies helpful?

 
 

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