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Make It Your Business to Get All Available Deductions

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stacks of old dirty pennies. bronze and copper pennies isolatedRunning your own business comes when joys and heartaches. The key is to avoid too much of the latter.

With that being the case, recording and paying taxes as a business owner can be one of life’s biggest headaches.

If you’re self-employed and have no employees under you, life is much easier when it comes to your tax responsibilities.

On the other side, making sure you take the right amount of money out for employees and meeting your other tax responsibilities as a business owner, well, it can sometimes seem downright taxing.

Don’t Make Running a Business Taxing

In running your own business, be sure that you not only are meeting all your tax requirements, but that you are receiving the deductions entitled to you.

For those individuals working out of their homes full-time, there are myriad of deductions one qualifies for, though many oftentimes forget or quite frankly do not know what is and isn’t acceptable to the IRS.

If you’re one of those self-employed folks working out of a private residence, note the following:

  • Your home is deductible…. up to a point – Working out of your home does allow for some deductions, but don’t expect to cover the entire residence from top to bottom. If you set aside a room etc. as your work area, you can use that as a deduction (estimate the square footage involved). What you can’t do is try and deduct the entire residence;
  • Your home office supplies – Assuming that your business needs office supplies, those can be used as deductions. Make sure you save the receipts for items you purchase. If you end up getting a new computer, fax machine, printer or other such office item, you can also deduct those. The key is always to save the paperwork from such purchases, especially if you need to show at a later date that you did in fact buy such items;
  • Your client meetings – When you mix and mingle with clients, you can deduct such meetings (that is up to a point). Meals and mileage to and from such meetings is fine, but don’t try and deduct a gift you may have bought them etc. Stretching things too far could run you the risk of an IRS audit, so it is definitely in your best interests to record and be honest about your deductions. If you do have legal questions or in fact do get audited, a New York tax attorney or one closer to you can assist you with how to proceed;
  • Your health insurance – Unless you have been under a rock for the last three or so years, you know about the governmental requirement that the majority of Americans be covered by health insurance. As a result, make sure you not only have coverage, but look to see if you are eligible for a tax credit. The whole idea behind Obamacare was to make health insurance affordable for the majority of the country. When it comes to medical items, you also can deduct a portion of your doctor visits (including mileage to and from) and prescriptions or other such purchases;
  • Your retirement planning – If you are wise, you have been putting away money over the years for retirement. In doing so, you are planning for that day and time when you will not be working, most likely getting by on Social Security income. Whether you have an IRA or other such retirement vehicle, try and contribute as much as possible to it yearly. This then allows you to record deductions from the money you put into the plan. While there are caps on how much individuals may invest in their retirement portfolios, doing it now and getting the deductions makes it well worth it.

When it comes to doing your taxes as a self-employed business owner, they don’t have to seem as frightening as they might first appear.

Getting organized now, keeping all your necessary receipts, and knowing who to turn to in the event of a dispute and/or audit, can make all the difference in the world.

If doing your taxes seems a bit taxing to you, put organization and the help of others to work for you.

Photo credit: BigStockPhoto.com

About the Author: Dave Thomas writes about business topics on the web.

The Business of Earning More Money

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Budget ConceptWhat are you doing to earn more money?

Some business owners (and regular consumers for that matter) will try and come up with myriad of ways to bring in some extra income, especially in a day and age when media incomes are stagnant for many people.

With that in mind, have you been toying with ideas in 2016 as to how to make your wallet or purse a little fatter in terms of the green stuff?

Be Innovative

So that you can increase your income this year and moving forward, have you thought about some of these ideas?

  • Selling products on the side – From Avon to jewelry and much more, selling a product or products on the side from your full-time job is a good means to earn extra money. In fact, some individuals sell such products as their regular jobs. This allows them in essence to be their own bosses, work from home, set the hours best suited to them and more. If this might sound of interest to you, going online is a good place to start. Doing a Google search of such items will get you going in the right direction. You may also have a friend or friends that sell such items on the side or full-time, so they would be great reference points;
  • Overtime hours – While some companies have strict rules on working overtime, many others will allow employees some overtime opportunities from time to time. Get with your boss to see if you in fact are eligible for some bonus hours at work. This is great because you do not have to (unless you so choose) find a part-time job or two on the side. Working extra hours at your full-time job also allows you to build up more experience in your current position, something which could help you with a possible promotion and raise down the road. One thing to avoid, however, is working too many hours to the point where you essentially suffer burnout at some point;
  • Consulting – It is not uncommon to see older workers turn to consulting, something which can lead to less stress and still provide a decent stream of revenue. This is especially a good option if you have years and/or decades in a chosen field. Go online and do some Google searches for consulting in your field of expertise;
  • Leasing your land – Not everything revolves around your resume when it comes to making some extra money. If you own a sizable amount of land, you could lease it out on occasion for a variety of purposes. Hunting on leased land has become more popular in recent years, especially given the fact that more and more land is being consumed by developers, those same developers that are looking to build office spaces, shopping facilities and more. If you are willing to rent out some of your property for hunting, fishing or other such outdoor activities, be sure to draw up a contract each time, making it clear what the rules and regulations are for anyone spending time on your property. You might also consider renting out space on your property if it is large enough for someone to run a small business from there. With rents oftentimes sky-high in cities and towns, small business owners on a shoestring budget wouldn’t mind saving some money. Having them renting a portion of your property to get or keep their businesses up-and-running until they have more resources to expand one day makes sense. Still another idea is renting out extra parking spaces if you have them on your premises. Neighbors may be willing to pay you on a monthly or yearly basis to use such spots, especially if they are limited where they can currently park and/or have multiple vehicles. While your land is your pride and joy, there could be cash-flow opportunities sitting right under your nose;
  • Helping those in your community – From family and friends to neighbors, there are probably a number of extra income opportunities you have not thought of before. Some of these involve helping those closest to you. From babysitting to working on people’s properties, get creative and see how you can pad your wallet or purse. Sometimes knowing you are helping others, all the while adding a little extra to your income reservoirs, is a great feeling.

No matter what you do full-time for a living, are you interested in earning more money?

If the answer is yes (you might be hard-pressed to find those who would say no), then put your thinking cap on and get to work at it.

Being savvy when it comes to earning more money and just improving your overall life is something you should always be thinking about.

What are you doing in today’s challenging economy (business or personal) to make more money?

Photo credit: BigStockPhoto.com

About the Author: Dave Thomas covers business and marketing topics on the web.

Did You Hire the Right Financial Advisor?

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Risk Reward GraphGiven the importance of your financial investments (whether you are a business owner or just a normal consumer), it should come as no surprise that having the right person oversee them is something you should never take for granted.

That said you might be surprised how many consumers leave their financial well-being up in the air.

As a result, they leave themselves vulnerable to financial calamity sooner rather than later. Even if they stave off financial problems for the foreseeable future, their idea of a perfect retirement can very easily be put in jeopardy.

So, with the idea that investing in your financial future should always be taken seriously; take stock in your current financial picture and also where you would like to be down the road.

Research and Never Settle

If you haven’t already, start by research financial experts to see who and which investment company is best suited to handle your money needs.

With many still expressing concerns about an ability to retire one day, keep in mind that you are not alone with your fears.

You want a financial pro that has the following:

  • Experience – Although it sounds like a no-brainier, be sure that you hire someone who has some real meat on their financial resume. How long have they been in this line of work? Have they stayed with the same firm over time or jump around from place to place? What do their colleagues think of them? Have they and/or their company been involved in any concerning business matters over the years, notably complaints or even lawsuits from consumers? These are all areas that you should research;
  • Customer service – Nothing is more irritating as a consumer than having to chase down the person who is supposed to be working for you, not the other way around. While that individual obviously has countless other clients, be sure they can make time for you when needed. Whether it is a simple financial investment question or you have a financial matter of urgent concern, they need to be as accessible as possible to you.

You Have a Job Too

While locating the right financial pro is necessary in advising you of the best moves with your money, you also have an important role to play.

Unlike younger investors who have some “recovery time” on their hands when they either get a late start and/or make a few financial investment mistakes here and there, older investors do not have such luxuries.

If you are an older investor, it is important that you make sure all your financial eggs are in order, including playing catch-up if you are over the age of 50. Investors over that age are allowed to invest more money (up to a limit depending on if it is an IRA, 401K etc.) than younger investors.

Another key area of importance is whether you have a family or not.

If you are on your own, you have a little more flexibility. For those with a spouse and perhaps a child or two, financial decisions become all the more important.

Individuals in these situations should also make sure that they have a sound life insurance plan in place.

With a good life insurance plan, the breadwinner of the house can rest a little easier, knowing that his loved one or ones are covered should he or she become disabled and unable to work or even pass away.

While insurance agents are typically the go-to people for life insurance and other such needs, your financial pro can help lay out the basics for you, giving you some guidance on how having such a policy can impact your financial situation now and down the road.

Finally, with April 15 (tax day) creeping closer and closer, be sure to understand how your financial decisions can and will impact your tax burdens.

If you are contributing to personal IRA’s for example, you can note those contributions as deductions for the previous calendar year, lessening your taxable income.

With all there is to know about your financial situation today, tomorrow and ultimately down the road, make sure you’ve gone about hiring the right financial advisor for all your monetary needs.

When you do, you could find yourself being one happy camper.

Photo credit: BigStockPhoto.com

About the Author: Dave Thomas covers business and financial topics on the web.

Should You Give Out Raises?

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araiseIn 2013, the average company gave out a 3 percent pay raise. That average is expected in 2014, as well.

As a business owner, how do you know how much to give and who to give it to? And how can you keep everyone happy in the process?

The job market is tough, and fortunately your employees are aware of your company’s overall circumstances.

New graduates learned in college that one of the challenges they would face after school would be answering how to position yourself for best paying careers, so they, too, know what it’s like to be out in the real world.

How to determine who deserves a raise

As a small business owner, giving out raises at the right time to the right candidates is an important aspect of your job.

Employees like to know they’re doing a good job and they like to be recognized for their hard work, most likely in terms of more money.

Employees that may potentially deserve a raise are those that:

  • Consistently work hard – Do you have an employee that is willing to stay late or work overtime when needed? Does this employee do so with a smile on their face? Employees that go above and beyond their normal job responsibilities are the first that should be recognized. They care about your company and want to see it succeed. Hard workers almost always deserve raises, assuming your company can afford it.
  • Offer something unique to your company – Maybe this particular employee isn’t the hardest worker, but maybe he or she does something valuable and irreplaceable for your business. For example, if you run a small construction business and have one drywall specialist who consistently gets rave reviews from customers, offering a raise to keep the employee around is worth it. It shows you value their work and know it would be hard to find a replacement.
  • Meet or exceed their goals – If an employee regularly meets or exceeds sales goals, for example, they are most likely deserving of a raise. Without good, hard-working employees who sell your product or service, you wouldn’t have a business. Reward them.

How to keep everyone happy

When it comes time to give out raises, employees may start to gossip on who did or didn’t get a raise. This can cause tension and jealousy in the workplace, and may cause some valued employees to leave if they feel underappreciated.

To keep everyone happy, hold a one-on-one meeting with each employee, if possible.

Go over their position in the company, why they are or aren’t getting a raise, their strong points and what they can do to improve. Explain your position as a business owner and what your goals are long-term.

By making the employee feel like a part of a team (which they are), employee gossip should be decreased whether or not you offered them a raise.

For those that didn’t receive a raise, you could consider offering additional incentives.

These can include a few extra paid vacation days per year, allowing them to work from home one day per week or offering a more flexible schedule in the office.

Some employees would rather work four 10-hour days, for example, than five 8-hour days.

See what would be valuable to those employees and offer it to them, especially if you wanted to give them a raise but simply could not afford it.

Photo credit: businessnewsdaily.com

About the Author: Sarah Brooks is a freelance writer living in Glendale, AZ. She writes on personal finances, small businesses and travel.

Should You Turn Down a Better Paying Job for Job Security?

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ajob

A higher paying job can bring a positive change to your life. However, it may not necessarily be a better job option if you are not confident that you can keep it for a long time.

If your current job or another job offers better security, you may want to think twice before diving headlong into the more lucrative job.

Here are the pros and cons of turning down a higher paying job for job security:

Pros of Choosing Job Security over Higher Pay

Lower Risk of Losing Your Job

A high paying job is generally more sought after, and therefore, it may offer lower job security.

If a company is willing to offer a high salary for a certain position, it should not have difficulty finding suitable candidates.

As such, there is a higher chance that you will be replaced if you do not meet your employer’s expectations satisfactorily. Sticking to your current job or getting a secure job puts you at a lower risk of losing your job.

Less Stressful

Salary is usually determined by job requirements and responsibilities.

If you decide to take a better paying job, you have to be prepared to assume greater responsibilities.

Playing a more important role and working in a new environment can make you feel uncertain, anxious and worried, and contribute to your stress level. Stress can affect your work performance and make it more difficult for you to hold on to the job.

If you feel that you will be more comfortable staying in your current job or getting a less stressful job, it may be a good idea to turn down the higher paying job.

Enhance Your Resume

Being employed by a company for a long time shows that you are a loyal employee, and it will make your resume look better.

If you cannot hold on to the high-paying job for long and have to look for another job, it may give your future interviewer the impression that you are a job hopper.

Also, if your current employer is not happy with your decision to leave the company, he or she may not give you a good reference.

Cons of Choosing Job Security over Higher Pay

Miss Out On an Opportunity to Improve Your Quality of Life

Getting a higher paying job enables you to meet your financial obligations more easily and improve your quality of life.

If you have a family, you can provide a better life for your spouse and children, and enjoy greater financial peace of mind. However, the improved financial situation may not last long if your new job is not secure.

Give Up a Possible Chance to Advance Your Career

The higher paying job you are offered may be a career advancement opportunity.

Other than offering a higher salary, it may also provide a chance for you to learn and perform higher-level tasks or assume a leadership role. It may be your dream job if you are able to hold on to it.

Making the wrong career move can have a negative impact on your life.

Just as many smaller companies worry about their small business reputation, those job hunting and/or changing careers need to be resolute to the fact that different jobs offer different possibilities.

Make sure you weigh the pros and cons above before you decide whether you should accept or turn down a higher paying but less secure job.

As a professional, what is more important to you in regards to a career, your salary or your security?

Photo credit: thinkbigmagazine.com

About the Author: John McMalcolm has written a wide variety of blog posts and articles for many websites, from resume tips to running a small business.

Living Life on the Financial Edge

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If you have a full-time job, one that pays good wages and is all but a sure thing, by all means enjoy it.

As I and millions of others discovered in recent years, a sure thing in the workplace is about as reliable as politicians in Washington, D.C. coming together for the good of the people.

Having been laid off twice in the last seven years, I can say that both experiences were different.

The first job loss in 2006 (after five-and-a-half years with the company) really came out of the blue. Even the manner in which I was informed, an email from a supervisor on a Friday morning, was a tad shocking.

After the reality of the situation set in, I did something down the road that no one should ever do, I began to panic.

How would I pay my rent? Could I still make my car payments? Would I not be able to afford health insurance now that I was on COBRA (the first layoff taught me to get my own health insurance policy, something I carry to this day)?

Despite the best parents in the world helping me out financially, I still was forced to pile up debt on credit cards, not to mention raid some of my retirement fund. I then made matters worse by temporarily moving to Arizona, taking a nearly $12,000 pay cut from the previous job I had been laid off at, and continued wallowing in debt.

After six months in Arizona, I knew that going back to California was not only something I wanted to do, I needed to do.

Was Another Layoff Possible?

So that I don’t make you change the channel, I will skip a few years from then until my second layoff last summer in marketing.

Although I was a top producer in my department (achieved three bonuses) when it came to turning out copy, I was let go after 14 months. Once the initial shock wore off, I came to realize that such a move was probably inevitable, especially given the mismanagement at the company by some of the executives.

With few full-time jobs calling my name, I went back to my old standby, freelancing.

Despite more than 20 years of writing experience, I get few if any phone calls for job interviews these days, knowing that many companies prefer paying someone just out college meager wages as opposed to what someone with decades of experience would command. I also know that many of these companies will face a revolving door of workers, those smart ones who do not take long to realize they are being underpaid, especially given today’s cost of living expenses.

While freelancing is for now keeping a roof over my head and food on the table, it is by no means job security.

Don’t get me wrong, I am extremely grateful for any work thrown my way these days, I just know that I’m living life on the financial edge.

Every time I drive by a homeless person or homeless encampment (they seem to grow by the day here in San Diego), I realize that that could be me in a month, two months, six months from now. On the other hand, I also know that there are people far worse off than I am right now.

It almost seems sad, here in the richest and most powerful country in the world, many people are not able to realize the American Dream.

What the future holds for me I can’t predict, something few if any of us can for that matter. I do know, however, that being a freelance writer is not the worse thing in the world.

That being said, I would not mind if I was not living so close to the financial edge.

Have you had ups and downs in your career over the years?

If so, what has it taught you about surviving in today’s world?

 

Photo credit: bubblews.com

About the Author: With 23 years’ writing experience, Dave Thomas covers a variety of small business topics, including finding the best invoice software.