Tax time is here again. Get out your calculators, organize your receipts and take note. Here are some last-minute tips to help you minimize the pain.
Bad for Investors, Good for Taxes?
The bad news is that most investors are down big this year. The good news is that you can apply up to $3,000 of your losses to offset your taxable income AND carry forward any losses in excess of $3,000 for future tax years. Keep in mind, if your losses are in your 401k or IRA -- you cannot claim the $3,000 loss on your tax return. The credit is only available to you if you actually sold any of your investments.
Tax Breaks for Homeowners
There are three new provisions which could translate to a savings for homeowners. As you may recall, Congress passed a housing bailout bill this past July. If you recently purchased your home—within the last year—you may be eligible for a tax credit of up to $7,500. The credit was put in place to give new homeowners an extra helping hand with their mortgage.
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Showing posts with label TAX Tips. Show all posts
Showing posts with label TAX Tips. Show all posts
Taxes are one of the most important issues facing small and growing businesses. And like a company's profits, its annual tax bill will in part reflect the owner's skills and knowledge. Business owners need to be sure that they are meeting all of their responsibilities to the tax man -- and also seizing every opportunity to reduce their taxes. These tax tips will ensure Uncle Sam is not getting more than his due.
- Writing It Off: Deductions. Businesses can deduct all "ordinary and necessary" business expenses from their revenues to reduce their taxable income. Some deductions are obvious—expenditures in such areas as business travel, equipment, salaries, or rent. But the rules governing write-offs aren't always simple. Don't overlook these potential deductions:
- Business losses. Business losses can be deducted against a business owner's personal income to reduce taxes. If a business owner's losses exceed personal income for the year, some of the year's business losses can be used to reduce taxable income in future years.
- Trips that combine business and pleasure. If more than half of a business trip is devoted to business, deduct the traveling costs, as well as other business-related expenses.
- Employee Taxes. If a business has employees, a variety of taxes will have to be withheld from their salaries. Among them are:
- Withholding. Social Security (FICA), Medicare and federal and state income taxes must be withheld from employees' pay.
- Employer matching. Businesses must match the FICA and Medicare taxes and pay them along with employees.
- Withholding. Social Security (FICA), Medicare and federal and state income taxes must be withheld from employees' pay.
What Kind Of Tax Advantages Do Home-Based Businesses Enjoy?
You have probably thought of many of the benefits of running your own successful accounting and bookkeeping service. From the independence of working for yourself to making better income than you may currently make, there are many reasons that starting a home-based business might be right for you. One consideration that you might not have taken into account is the tax advantages that you will enjoy with a business run out of your home. Let's explore these qualifying deductions, starting with the better-known ones.
The Home Office Deduction
The deduction that likely comes first to mind that home-based businesses can take advantage of is the "Home Office Deduction". The Home Office Deduction allows you to deduct some or all of the expenses of your office at home and related expenses.
To qualify for this deduction, your home office must be the principal place where your business is done. Secondly, the office space must be used exclusively for business use to qualify. For example, if you use your kitchen as your primary workspace, it is likely that you cannot take the home office deduction, assuming that you use it for personal use as well. To be on the safe side, set aside a room as your home office where possible. This will keep you on the safe side should the home office use ever come into question.
Detailed explanations of who qualifies for the Home Office deduction are defined in detail by the IRS themselves.
Read More Article...
You have probably thought of many of the benefits of running your own successful accounting and bookkeeping service. From the independence of working for yourself to making better income than you may currently make, there are many reasons that starting a home-based business might be right for you. One consideration that you might not have taken into account is the tax advantages that you will enjoy with a business run out of your home. Let's explore these qualifying deductions, starting with the better-known ones.
The Home Office Deduction
The deduction that likely comes first to mind that home-based businesses can take advantage of is the "Home Office Deduction". The Home Office Deduction allows you to deduct some or all of the expenses of your office at home and related expenses.
To qualify for this deduction, your home office must be the principal place where your business is done. Secondly, the office space must be used exclusively for business use to qualify. For example, if you use your kitchen as your primary workspace, it is likely that you cannot take the home office deduction, assuming that you use it for personal use as well. To be on the safe side, set aside a room as your home office where possible. This will keep you on the safe side should the home office use ever come into question.
Detailed explanations of who qualifies for the Home Office deduction are defined in detail by the IRS themselves.
Read More Article...
Tax Tips For Single People
- If there are going to be tax cuts in the next financial year, make sure you prepay membership fees for unions & professional associations and make any charitable donations before the end of this financial year (June 30)
- If you have a few $1000 in spare cash, don’t leave it in your transaction bank account earning no interest, instead put it in an Online Savings Account with a High Interest Rate and No Bank fees
- If you’re single and going to earn more than $100,000/year (from July 2008-June 2009) make sure you take out a basic private health insurance plan (with an Excess of $500 or less) or your Medicare levy will rise from 1.5% to 2.5%.
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