Contrary to what everybody thinks, especially W2 employees, the IRS is your friend. The IRS tax code is designed and set up for promoting small business and home based business. Only five percent of the IRS code is really written about bringing in income for the IRS. The rest is all about expenses and deductions. So 95% is dedicated to reduce your taxes!It is awesome!There are a few things that you need to provide the IRS to qualify your home based business, but they are mainly looking for profit intent, consistency and record keeping.1. Profit Intent is relatively easy to prove. If it’s a hobby, like if you’re trying to turn your Saturday golf game into a business, that’s going to a bit tougher. Home-based businesses like network marketing, setting up a paint company or wedding planner or something, should be pretty easy to prove it’s a “for profit” business.2. Secondly, you need to work your business on a regular and consistent basis. There’s no specifics on that but, even four to six hours a week, every single week should be sufficient. Of course, I recommend more than that if you are going to be serious about your business.3. Lastly, you’ll want to keep accurate records to prove that you have income and expenses.If you keep accurate records of expenses, you can offset other income that you have. The expenses you have from RUNNING your business, such as expenses from your office in your home based business or money spent building your business, doesn’t go to waste. You get to write it off. Your marketing, your business cards, your flyers, brochures or anything like that. If you want to RUN a business, you need to use all legal write-offs in your business and that’s what will help you, not so much to get profitable right away, but make it worthwhile so that you’re not losing money.My Two Favorite Legal DeductionsMy first Favorite legal deduction is the home based business office deduction, which is huge!For example, if you have a 1,000 square foot house and you have a 100 square foot office, this gives you a ten percent write-off. It doesn’t matter whether you’re renting or you own your home and have a home mortgage. If your rent or mortgage is one thousand dollars, you get to write off, 100 dollars every month. If you need a new computer for your business, a video camera, software or anything that you use to promote and market your business, it can be written off.My second favorite deduction may be even bigger. It’s your automobile. Currently the business use mileage rate is 55.5 cents per mile. Always check the IRS website or with your accounting professionals, for updates.Let’s look at how this works.Let’s say you need to drive to go meet a prospect or you have to go to the office supplies store. You’re going to keep track of all your “business” mileage to and from your business stops. You track ten miles in each direction for twenty miles total. That’s $11 that you will deduct at year’s end. As long as the initial reason for the trip was business, you can write it off. It will be between you and me if you just happened to stop at the grocery store on the way home. Oh yeah, the food you ate at your business meeting;50% of that can be written of as well!Other Legal Deductions
If you have a child over the age of 6, they can be employed in your business. You can deduct their wages and they don’t have to claim it up to $5,450. Double whammy! It must be a business related activity and not just taking out the trash. They could do filing or database management. Face it, your 6-year-old probably knows how to use the computer better than you anyway!
With the proper planning you can deduct part or all of your vacations. Let’s say I am going to New York to meet with a client or prospect. We are going to have a few business meetings and talk about ways to grow our business. I can take my wife and we can do some tourist stuff while we are there. Travel can be written off with the proper planning.
All of your health costs may be able to be deducted.
Again, 50% of all food and entertainment that is “business” related can be deducted.These are just the tip of the iceberg folks. You need to learn this stuff! If you know what you can deduct, it will help offset the cost of getting your home based business up and running and put you in a NO LOSE, situation. Once you are profitable, you will still need to track your deductions, but it will have become second nature by that point.There are many books on this subject and your tax professional can help as well. You need to have the right tax person because some will fight you on certain deductions. If they are LEGAL, there is no reason why you shouldn’t be taking them. It’s all in black and white on the IRS website, so get familiar with it.Using Your Money For The Monthly Expenses Of Your Home Based BusinessI hear people saying that they just can’t afford to start a business. GARBAGE! If you are currently employed, which you should be if you are trying to start a home based business, you can afford to get started. All you need to do is change the number of withholding on your w-4 and receive your tax refund in advance.Dangerous? Not even close. It’s your money! Getting a huge refund, once a year, is not a good thing. You are loaning your money to the government. Why not use it to create income for your family? Don’t get this money if you are going to be stupid and just buy stuff.Use it to start a home based business!I hope this helps show you how to make money with a home based business of your own. It’s not that scary and you can “learn as you earn.”
The IRS Wants You To Make Money With Your Home Based Business
Flipping Houses For Profit – Easy Home Based Real Estate Business
Simply put, the process of flipping houses can be described at purchasing a property and reselling it for a profit. The house flipper (potentially you) tries to complete the entire house flipping process within the shortest time interval, thus making quite a hefty profit.
Attaining success in the house flipping game requires the potential investor to think like a real estate power investor and capitalize on the available opportunity by executing a series of well timed decisions to the best of one’s ability and access to resources.
If you’re planning to resell houses (better known as ‘house flipping’), you need to have a solid framework of the strategies and techniques that can be put into practice, in addition to the technical know-how in areas such as tax planning.
Once you have a strong educational framework ready, you need to start planning on achieving success.
Your Planning activity should include:
Setting your short (daily, weekly, monthly), medium (quarterly, half yearly, yearly) and long term goals (more than one year).
Determining exactly what tasks you would like to achieve in a given period.
The strategies you’ll be implementing in executing your plan.
You’ll be performing these strategies everyday, thus as you probably know by now – real estate investing is locating properties that can be sold with comparative ease, negotiating the details of the process and then choosing the best path of action that should be implemented by you for archiving the maximum profit.
If your lucky, it’ll be a quick flip after a minor (or major) property rehab, while at other intervals you’ll just be required to buy and hold your house so that it can be sold at a higher price at a future price, while sometimes its a little bit of both. Thus, the key to real estate investment success lies in determining what the market wants in order to make the maximum profit.
If your getting started now, and are scared about making mistakes, thus will cause a sense of dread within you, that will prevent you from reaching the peak of success. Don’t allow this dread to set in, instead take the assistance of an experienced real estate investor, who has gone down a similar road as you, for being your mentor of sorts, who has the ability to gently guide you by the hand until you reach the winner’s circle with up to date advice, encouragement and valuable words of wisdom.
Real estate investing is an art and one needs to know exactly what strategies to use no matter what situation the market is in (it hasn’t been hotter in the past 30 years than it is in 2009), and you will need all the tools of the real estate investing trade, such as the acclaimed patented real estate home analyzer robot software to quickly determine the value of a property and identifying the relevant comps, thus arming you with the correct information as part of your property research. Best of all, it automatically pulls the values and comps from three of my favorite websites. Then it prints a PDF report that you can save and utilize it while comparing different properties, so as to make the most economical offer.
Real estate investing does take commitment and stamina. You too can start today, by taking these simple lessons to heart and allowing the touch of a master’s hand to transform your dreams into a reality.
Written by Charrissa Cawley (fondly called “Cher” by her buddies), founder of the Real Estate Power Investor home learning e-course – the complete learning resource that goes into the depths of real estate investments as per the current market scenario.
She’s a multimillionaire real estate investment guru, who just until half a decade ago used to be a 31 year old stay at home mom. She has aced the world of real estate investing, making US$2.14 million dollars in her first year as a real estate investor as net profit. She has long standing reputation for excellence as a real estate trainer, gifted speaker and wealth building coach. Her strengths include training entrepreneurs of all experience levels in all areas of real estate investing and financial literacy.
Considering a MLM Home Based Business?
A MLM home based business is a very lucrative way into generating a second income or even become your main income stream. There have been and will still be many millionaires generated from this sector, due to the main secret of leveraging the internet for your benefit. As there are many attractive points in joining one of these home businesses there are also many out there which have been created mainly to scam you out of your own hard earned cash.
You should always to your primary research onto the home business which you are considering on joining. Now a day this is easier than ever before as you have the largest and most powerful detective in the world at your finger tips (the Internet). All you need to do is search for the business you’re looking for and then weigh out the positives and negatives of an MLM home based business before you decide that if it is the right business for you.
A MLM home based business involves in you selling products or services throughout the web. You will receive a commission on any sales that you finalise and with some MLM businesses, the customers who bought from you can become a team member underneath you. This means every time a team member sales one of your products they will get commission also but you will get a percentage of their commission this is what is called residual income.You need to seriously understand that there are many of these businesses out there on the web. Many of them copy the structures of legitimate MLM home based business concepts. There for this means that there are many out there which are scams and have pyramid schemes in place which in fact is illegal and getting involved in one can cause you more trouble than you can possibly imagine.
There are many positives with running your own home based business which are the following:You will be working from home where you determine your working hours plus your overheads are low and you can actually claim some of you home bills against your Tax bills, but I to suggest for you to get advice from an accountant.There is no need to manufacture any products, because you are usually selling things that are already made and the MLM business which you have joined normally will help you and advice you on how to market these products or services.The disadvantage to MLM home based business lies on your determination and where your skills for selling lie. If you got strong leadership skills and are very self motivated, then this industry will pose little hardship to you.However in the other hand if the above are you weaker points then you will have to work a little bit harder than the rest to make sure you succeed in your venture.One thing you should take from this article is that you need to do your research on the business that you tend to join, to find out if it is legitimate. Once this is done really the world will become your oyster.With a little hard work and determination your world will change around you, but you need to find a good and an understanding Mentor where both of you feed of each other’s experiences.Click on MeTo your success,Pedro Magalhaes- Mentor of Change!