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You should if you want to take full advantage of a tax deduction many people overlook. The home office deduction allows individuals to deduct expenses that are not otherwise deductible such as utilities and homeowners insurance. There are certain requirements you must meet to have a home office, including:

You own a business (if you are an employee, you must meet the “for the convenience of the employer” test). You have an area set aside in your home used regularly and exclusively for specific administrative or management activities There is no other place of business where you conduct those activities

These requirements help you to determine whether the area used in your home is your principle place of business for certain business functions.

If you don’t think the area you use qualifies, you may just need to change the facts. Are there too many nonbusiness items in your office area? Move them to another room and you may qualify. Are you struggling to find business activities that you can do at home? Bookkeeping, billing and ordering supplies are just a few activities that are easily done from home.

Once you’ve determined that you have a home office and you would like to take the home office deduction, you need to track certain expenses.

Allowable home office expenses include:

- Utilities

- Mortgage interest

- Property taxes

- Homeowners and liability insurance

- Repairs and maintenance of office area

- Depreciation of office area

Deductions that do not qualify as home office expenses are items that do not relate to the home office such as landscaping and pool care. In addition, taxpayers are denied a deduction on a first phone line regardless of the level of business use. A taxpayer must have a second phone line to deduct telephone expenses, long distance charges and internet service.

Of course you can’t deduct 100% of these expenses. The expenses are allocated based on square footage or number of rooms in the house. In most cases, the number of rooms allocation yields a higher deduction, make sure your CPA calculates both numbers to maximize your deductions.

- What You Should Know About Home Office Deductions -

Home office deductions are allowed for areas used exclusively for the management and administrative duties of the business when these functions are not conducted in the principal place of business.

Prior to 1999, the IRS regarded the location of major business transactions, based on time usage, as the principal place of business. For example, sales conducted in customer’s homes disallowed the home office deduction, even if invoicing, bookkeeping and other management functions were conducted from the home. Now these responsibilities are accepted for home offices.

However, if multiple businesses are conducted from the home, separate office space should be allocated, or the entire deduction taken, in the most active business. This is particularly important where spouses each conduct business from the same home office space.

Home Office Requirements:

The home office must be an area in the home set aside and used regularly and exclusively as an office. No other fixed place of business can be used to conduct the same business regularly.
General expenses of your home are deductible in proportion to the business office percentage of your home. This can be measured either by square footage or by number of rooms, excluding bathrooms and hallways.

Certain home office expenses must be paid through your company, while others are personal expenses.

The following items should not be paid by your company:

- Mortgage expense and interest.

- Property taxes.

- Homeowners and liability insurance.

- Repairs and maintenance of the office space.

The following items should be paid through your company:

- furniture and fixtures purchased specifically for business purposes, whether stored in the home office or at another location.

- Separate business phone lines that are installed at the home office.

- Office supplies.

- Other items specifically used for the business.

The following items are not generally deductible:

- Landscaping and lawn maintenance.

- Pool care.

Tom Wheelwright is not only the founder and CEO of Provision, but he is the creative force behind Provision Wealth Strategists. In addition to his management responsibilities, Tom likes to coach clients on wealth, business, and tax strategies. Along with his frequent seminars on such strategies, Tom is an adjunct professor in the Masters of Tax program at Arizona State University. For more information, please visit http://www.provisionwealth.com

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The main thing tax will need for tax mistakes income tax return is proof of the income you made and the taxes you paid in the previous year. That includes income made through employers, interest from accounts, dividends from investments, income made through self-employment, income made as a subcontractor, and any other income. Student loans and other types of loans may also be considered income for the purposes of income tax, as can winnings from a lottery, casino, or other contest. If you are unsure what can be considered as income for tax purposes, you should contact a certified public accountant.

The other thing that is important is social security numbers for everyone you will claim on your income tax return. That includes social security numbers for your spouse and any children you will claim. Without social security numbers, proof of residence, and birth dates, you cannot claim deductions on your income tax return for these individuals.

The next thing that you should gather is what you will need for deductions. If you have a mortgage, your interest paid tax the mortgage company may be tax deductible. If you use a vehicle for business purposes, you can claim a tax deduction for mileage. If you have children in daycare so that you can work, you can claim a tax deduction for that expense. You can also claim tax deductions for excessive medical expenses and charitable contributions.

If you are self-employed, you will need to also gather your receipts for tax deductible expenses. A tax deductible business expense is any expense that is used solely or primarily for the business you are involved in. The tax deductible expense must be documented in order to claim it, so any receipts you have, usage logs for computers and vehicles, etc. should be gathered so that you can take the highest deduction possible. If you have any doubts about what is tax deductible for your business, you should contact a certified public accountant to assist you in your income tax preparation.

Once you have gathered all of the necessary tax documents, you must determine which tax forms you need to file. If you are an individual with few tax deductible items, you can file a simple tax return. However, if you are self-employed you must also file a tax form called Schedule C. If you have a lot of tax deductible items, you will want to file a more complex tax return to itemize your tax deductions. If you are unsure what tax forms you need to file, you should contact a certified public accountant to assist you in your income tax return preparation.

Tax day can be a stressful time, but it doesn’t have to be. Gather all of your required tax documents as early as possible, and don’t put off the inevitable. Contact a certified public accountant as soon as you can if you are unsure what tax forms you need to file, or what tax deductions you can take. And, most importantly, don’t panic on tax day!

For more information on the accounting field please visit
http://www.bytelan.com/indexaccounting.php

John Tahan is a webmaster, computer expert and musician, for all your musicians and music lovers you can visit: http://www.tzarrockmetal.com, http://www.guitarapprentice.com

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You should if you want to take full advantage of a tax deduction many people overlook. The home office deduction allows individuals to deduct expenses that are not otherwise deductible such as utilities and homeowners insurance. There are certain requirements you must meet to have a home office, including:

You own a business (if you are an employee, you must meet the “for the convenience of the employer” test). You have an area set aside in your home used regularly and exclusively for specific administrative or management activities There is no other place of business where you conduct those activities

These requirements help you to determine whether the area used in your home is your principle place of business for certain business functions.

If you don’t think the area you use qualifies, you may just need to change the facts. Are there too many nonbusiness items in your office area? Move them to another room and you may qualify. Are you struggling to find business activities that you can do at home? Bookkeeping, billing and ordering supplies are just a few activities that are easily done from home.

Once you’ve determined that you have a home office and you would like to take the home office deduction, you need to track certain expenses.

Allowable home office expenses include:

- Utilities

- Mortgage interest

- Property taxes

- Homeowners and liability insurance

- Repairs and maintenance of office area

- Depreciation of office area

Deductions that do not qualify as home office expenses are items that do not relate to the home office such as landscaping and pool care. In addition, taxpayers are denied a deduction on a first phone line regardless of the level of business use. A taxpayer must have a second phone line to deduct telephone expenses, long distance charges and internet service.

Of course you can’t deduct 100% of these expenses. The expenses are allocated based on square footage or number of rooms in the house. In most cases, the number of rooms allocation yields a higher deduction, make sure your CPA calculates both numbers to maximize your deductions.

- What You Should Know About Home Office Deductions -

Home office deductions are allowed for areas used exclusively for the management and administrative duties of the business when these functions are not conducted in the principal place of business.

Prior to 1999, the IRS regarded the location of major business transactions, based on time usage, as the principal place of business. For example, sales conducted in customer’s homes disallowed the home office deduction, even if invoicing, bookkeeping and other management functions were conducted from the home. Now these responsibilities are accepted for home offices.

However, if multiple businesses are conducted from the home, separate office space should be allocated, or the entire deduction taken, in the most active business. This is particularly important where spouses each conduct business from the same home office space.

Home Office Requirements:

The home office must be an area in the home set aside and used regularly and exclusively as an office. No other fixed place of business can be used to conduct the same business regularly.
General expenses of your home are deductible in proportion to the business office percentage of your home. This can be measured either by square footage or by number of rooms, excluding bathrooms and hallways.

Certain home office expenses must be paid through your company, while others are personal expenses.

The following items should not be paid by your company:

- Mortgage expense and interest.

- Property taxes.

- Homeowners and liability insurance.

- Repairs and maintenance of the office space.

The following items should be paid through your company:

- furniture and fixtures purchased specifically for business purposes, whether stored in the home office or at another location.

- Separate business phone lines that are installed at the home office.

- Office supplies.

- Other items specifically used for the business.

The following items are not generally deductible:

- Landscaping and lawn maintenance.

- Pool care.

Tom Wheelwright is not only the founder and CEO of Provision, but he is the creative force behind Provision Wealth Strategists. In addition to his management responsibilities, Tom likes to coach clients on wealth, business, and tax strategies. Along with his frequent seminars on such strategies, Tom is an adjunct professor in the Masters of Tax program at Arizona State University. For more information, please visit http://www.provisionwealth.com

Tags: administrative duties, advantage, Ally, amp, Ast, Bookkeeping, business, Business Activities, ceo, cia, Coach, convenience, creative, Employ, Employe, Expenses, find business, Fre, furniture, home, inc, informat, insurance, Irs, lows, Mai, many people, mortgage, Mortgage Interest, oic, People, Personal, phone expenses, pool, principle, Prope, property tax, property taxes, proportion, Rate, Regard, Rsi, sales, sit, Target, Tax, tax deduction, Taxes, taxpayers, Wheel

Gumballs are tax most common product sold in bulk vending machines for good reason. The profit margin is normally the highest compared to other product choices. The machines are relatively easy to place and do not require constant maintenance. Gumballs last approximately one year in a climate controlled environment; therefore the product shelf life is excellent.

Besides all this practical stuff, they taste good! I have adults who will almost chase me down to give me a “play by play” of who my top “quarter-plunkers” are in the office where my machine resides. It gets to almost tax mistakes absurd how adults can go on talking about gumballs like kids in a candy store!

My vending company has over 2,000 machines and over 80% of those machines are gumballs. The higher profit margins rack up the profits quicker. More profits mean a higher R.O.I. (return on tax mistakes investment). You need to give serious consideration to a good R.O.I. when you purchase gumball machines. Don’t disdain having a true business mindset when it comes to your machines (even if you only have a few). If you treat your machines as a real business it will pay you like a truly profitable business can.

The passive income created from the business is one of my favorite benefits. I don’t have to physically be there for money to flow into my business. Machines are making money for me 24 hours a day in some cases. I show up for less than five minutes per stop and reap the benefits of this awesome business!

Good profitability (”profit margin”) leads to having new found financial options. These newly created financial options can be great incentives to keep your business running smoothly. You have the option of investing your profits into other financial vehicles to multiply those profits further. Here are some excellent uses for the profits created by your gumball machines:

• Pay off consumer (credit card) debt
• Make extra principle payments on your home loan
• Replenish savings accounts
• Invest the money in a retirement account
• Save for college tuition for your kids
• Fund a medical savings account (talk to your accountant)
• Increase your business by buying more machines
• Fund a family vacation
• Make the machines a family business to involve the kids
• Use the business as a legitimate tax deduction against other income (see your accountant!)

Many people use vending machines to do these very things. Having a vision for your cash flow gives you incentive and motivation to operate a small business day in and day out. Most people I know who have machines still work their day job and use their investment in the vending arena to accomplish their financial goals.

Are gumball and candy machines for you? They can be a great asset for passive income. Visit my website below to get more great tips for vending and how to set up your company profitably (large or small) from day one.

Mark Evants manages a profitable vending company of 2000 machines in the mid west. For more extremely practical vending tips and articles on increasing cash flow and structuring your vending business visit:

http://www.vendingarticles.net – Tips and Articles for PROFITABLE Vending!

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The Mileage Tax Deduction Can Save You a Lot of Money

How often are you driving for work, as a volunteer or perhaps even moving? Would you say that nearly all of your driving is done for one of these reasons? If not, consider, the times you leave the office for business reasons, or if you work from home, leave and return home for business reasons. What about those trips you take if you haul the kids’ baseball team somewhere – or help out at your church?

All of these miles that you drive are deductible for tax purposes. As of July 1, 2008, the standard rate is also increased to $0.585 per mile ($0.19 for volunteer and moving miles). The IRS does require logs of miles to be kept for your records – and in case of an audit. You may find that by keeping logs up-to-date, at the end of the year you will have significantly more miles accounted for deduction purposes than if you are more lax in your record keeping.

The cost of driving a vehicle has skyrocketed in the past few years. Gasoline costs alone carve into business and household budgets in ways you could not have expected in the past. The driving you do to earn a living is a significant cost and Congress has recognized the importance of this deduction as a vital means for people to continue to pursue their incomes.

The tax code requires only that expenses are ordinary and necessary. It is not required that you show that the specific reasons for the expense are also ordinary and necessary – only that the expenses are both. So, for example, if you work from home and will be needing new paper for your printer in the near future, but decide to pick it up while you are out grocery shopping, both the expense for the paper itself, and driving to where you purchase it are deductible – wow!

Since the mileage expense to drive to the office supply store is ordinary and necessary, the mileage is deductible – in spite of the personal purchases you made while shopping. You have just converted an otherwise non-deductible trip to the store into a fully deductible business trip. There are many other opportunities available to you that you may not have thought about to take advantage of this deduction.

The mileage tax deduction, like many others deductions, can be calculated for free at TurboTax Online. The only time you are asked to pay for the service is if you decide to print or efile. Or, if you still have questions, visit Elusen Tax Advisors! Elusen has years of experience planning and advising clients on their tax needs, and helping fend off the IRS however necessary.

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Entrepreneurs who are looking to start a franchise start out by searching for the “Perfect Business”.

One unlikely source that those considering a franchise should not overlook is Richard Russell’s Dow Theory Letters. “Why” you ask? What does a “Dow Theorist” know about the “Perfect Business”.

Richard Russell began publishing the Dow Theory Letters in 1958, and he has been writing the Letters ever since (in fact, he has never once even skipped a Letter). The Letters, published every three weeks, cover the US stock market, foreign markets, and every thing economic. And, Mr. Russell is highly sought after for his economic commentary.

However, Richard Russell has written one piece that is his most requested article. Funny thing is… it has absolutely nothing to do with the stock market!

Nope, this piece is where he defines “The Perfect Business” . Go figure.

Here are Mr. Russell’s criteria for the “IDEAL BUSINESS”

1. The ideal business sells the world, rather than a single neighborhood or even a single city or state. In other words, it has an unlimited global market (and today this is more important than ever, since world markets have now opened up to an extent unparalleled in my lifetime). By the way, how many times have you seen a retail store that has been doing well for years — then another bigger and better retail store moves nearby, and it’s kaput for the first store.
2. The ideal business offers a product which enjoys an “inelastic” demand. Inelastic refers to a product that people need or desire — almost regardless of price.
3. The ideal business sells a product which cannot be easily substituted or copied. This means that the product is an original or at least it’s something that can be copyrighted or patented.
4. The ideal business has minimal labor requirements (the fewer personnel, the better). Today’s example of this is the much-talked about “virtual corporation.” The virtual corporation may consist of an office with three executives, where literally all manufacturing and services are farmed out to other companies.
5. The ideal business enjoys low overhead. It does not need an expensive location; it does not need large amounts of electricity, advertising, legal advice, high-priced employees, large inventory, etc.
6. The ideal business does not require big cash outlays or major investments in equipment. In other words, it does not tie up your capital (incidentally, one of the major reasons for new-business failure is under-capitalization).
7. The ideal business enjoys cash billings. In other words, it does not tie up your capital with lengthy or complex credit terms.
8. The ideal business is relatively free of all kinds of government and industry regulations and strictures (and if you’re now in your own business, you most definitely know what I mean with this one).
9. The ideal business is portable or easily moveable. This means that you can take your business (and yourself) anywhere you want — Nevada, Florida, Texas, Washington, S. Dakota (none have state income taxes) or hey, maybe even Monte Carlo or Switzerland or the south of France.
10. Here’s a crucial one that’s often overlooked; the ideal business satisfies your intellectual (and often emotional) needs. There’s nothing like being fascinated with what you’re doing. When that happens, you’re not working, you’re having fun.
11. The ideal business leaves you with free time. In other words, it doesn’t require your labor and attention 12, 16 or 18 hours a day (my lawyer wife, who leaves the house at 6:30 AM and comes home at 6:30 PM and often later, has been well aware of this one).
12. Super-important: the ideal business is one in which your income is not limited by your personal output (lawyers and doctors have this problem). No, in the ideal business you can sell 10,000 customers as easily as you sell one (publishing is an example).

Now, the really interesting thing is that in Mr. Russell’s article, he states that “the ideal business doesn’t exist, and probably never will”.

On that point, I think I have to disagree with Mr. Russell There is a business that meets every single one of Mr. Russells’ requirements of the “Perfect Business”

1. Clients in the US, Canada, Great Britain, New Zealand, Australia, South Africa, Europe, Japan and India. OK, I’ll admit that’s not the WHOLE world, but it definitely would meet most folk’s idea of a Global Business
2. Products are marketing training and financial education. Pretty much demand there.
3. Products were created by Mr. Kip Herriage, a Wall Street Prodigy who became a VP at one of the the World’s 5 Investment firms at age 28 . This company offers a uniq combination of Estate Planning, Debt Reduction, Tax Strategies, and Investment Knowledge. There is not another, single, product like this in the business. So that about covers Mr. Russells’ #3.
4. This business requires a grand total of ONE employee. Oh yeah, some folks do choose to have a virtual assistant, and outsource various jobs.
5. The “location” is usually your home. So, this means you actually get to take a percentage of your household electricity as a tax deduction! No extra expense there. The virtual assistant costs a whopping $4/hr, and there is absolutey no inventory involved. All orders are direct shipped from the corporate office.
6. Equipment consists of one or two computers and a cell phone. OK, the laptop can be a bit pricey, if you chose to opt for a beautiful 17″ macbook pro.
7. All terms of this business are via credit card or wire transfer. Payment for product purchases are usually the same day as the sale. Can’t get much quicker than that.
8. Of course, you do have to pay taxes. But, other than taxes, there are no government forms to file, or regulations to follow.
9. Sales can be made from home, while in Budapest at a conference, and while on vacations in Oregon and Sedona, or anywhere that has internet connectivity. All from a laptop. All quite portable.
10. The only problem with this type of business is that sometimes it’s too engaging. Marketing can become an “addiction”, so sometimes it’s actually difficult to turn off and enjoy the freedom provided by this type of business.
11. Other than your mind constantly being flooded with marketing ideas, this business can be done in 3-4 hours a day.
12. And, finally, even though this business is Direct Sales, it also offers leverage on several different fronts. For one thing, it is Internet based, so your websites, and ads driving traffic to your websites, can be producing revenue simultaneously. Plus, this business provides have the ability to build a team – and make up to 40% of your team sales. Quite nice.

Now it’s your turn to have a say in this. Could Richard Russell, the “Dow Theorist”, actually be WRONG on this one?

You can visit Richard Russell’s original article by visiting: Dow Theory Letters

Mari Ann Lisenbe is a former corporate software designer who now owns the “Perfect Business” — from her country home near Houston, TX. She is also a recognized leader in the world of web2.0 attraction marketing. Mari Ann would like to thank her former employer, Hewitt Associates, for outsourcing her job in 2003, which lead to her discovery of Entrepreneurship, Direct Sales, and the “Perfect Business”.

You can check-out Mari Ann’s “Perfect Business” by visiting: http://www.YourIncomeReplacement.com

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