Home Business Taxes
How to stop taxes in your home business from sneaking up on you.
"Sixty thousand dollars? You guys are joking right?" I had just completed my first year of being fairly successful on the internet. My taxes had been submitted to the accountant. I was on the verge of greatness. Then I got that bill. Sixty big ones. "How did this happen to me? Where am I going to get the money for that?" These thoughts ran through my head for a couple of days before I regained control. I decided not to focus on the negative. Instead of wallowing in misery I vowed to help others not repeat the same mistake
So how does it happen? Very simple. You have a breakthrough year. Breakthroughs have a tendency to happen without notice and become an avalanche of cash. That is the good part. The bad part is that most people are so used to scraping by that they are unprepared for their new found wealth The end of the year approaches and BAM the tax bill makes them pass out.
Here are things you should talk to your accountant about. Incorporation. First and foremost. My wife and I only had a DBA and a business account and we ended up paying $60,000 instead of $30,000. That's right; double the taxes for not being incorporated. Keep track of receipts when you eat out and ALWAYS write the name of the waiter on the top. If you leave a card for the waiter you can usually write off the lunch but you MUST write the name of the waiter on your receipt to keep good records. Use one credit card and bank account for business and one for personal. When you mix these two up it can be a records nightmare at the end of the year. Deductions will get lost. There are many more things you should look out for but these are the ones we messed up. Talk to a good accountant for the right advice.
| The bright side is we made this mistake before we went on to 7 figures online. If you would like to know how to make this kind of money from home check out our site at: www.fullcontactmarketer.com |
