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Tax Cutoff is Approaching, Is Your Business Ready?

April 1, 2013 By 2 Comments

The CEO

Tax Cutoff is Approaching, Is Your Business Ready?

Getting a small business off the ground can put enough on your plate without having to think ahead to tax season. But if you’re new to owning your own business, you might not be prepared for how complicated small businesses taxes can be and how much you need to take them into consideration all year long. Keeping accurate books and records will not only help you in the event of an audit, it will also make sure you get the most deductions possible. Tax deductions can be a huge financial boost to a new business, or at least a good way to avoid owing too much, and you might be entitled to write off more than you know. Maximizing your deductions plus avoiding traps associated with filing business taxes can often make for a delicate balance.

1. Get Help – You Need It!

No matter how savvy you think you are with the tax system, you shouldn’t prepare your business taxes alone. Doing taxes for your business is actually very complicated and can often involve a lot of paperwork and a lot of math, and if you make serious mistakes, they can cost you in later audits. Government rates and percentages for how much you can deduct are constantly changing, and there are probably rules about what you can deduct and how you report it that you simply don’t understand. In fact, the sooner you get help with tax preparations, the easier the process of filing your taxes will be. Finding a good accountant should be one of your priorities once your business starts to take shape. You may need a reliable bookkeeper too, if your company’s financial dealings and clientele become too extensive for you to keep track of your records.

2. Special Deductions and Potential Problems in Year One

Your first year as a business owner can be slightly different than your subsequent years when it comes to how you file taxes. The biggest pitfall for new businesses are the estimated tax payments that you submit quarterly. Your estimated payments are based on how much you expect to earn during the year, but if your business is brand new, it can be really difficult to make an educated guess. If you pay far too little, you could end up owing a lot of money at the end of the year. But you can also write off many of the costs involved in forming your business – the Small Business Job act of 2010 permanently raised the amount of startup costs that first-time business owners can deduct to $10,000. That’s a good reason to keep your receipts.

Catching up on e-mail…

3. Knowing What You Can and Can’t Write Off

With all of the clients, meetings, and business excursions that can happen in a year, it’s easy to get mixed up with what you can and can’t deduct, and you might not even intend to. Remember to keep business receipts for strictly business activities. You can write off meals and entertainment events as long as they are directly related to client meetings or other business purposes. Even the amount of automobile deductions you make is directly related to how much you use your car for business. All personal driving is invalid. The good news is that there are plenty of things you can write off that business owners sometimes forget. You’re entitled to the home office deduction as long as you have a true home office, even if you don’t do all your work there. If you’re self-employed and paying for private health insurance, you can also deduct 100 percent of the cost.

As you can see, there are a lot of things to consider when it comes to filing business taxes. You need a reliable accountant or tax preparation service to make sure you understand what your records really mean as far as what you owe and what you can be refunded. Getting a head start on thinking about these issues can change the future of your business for many tax seasons to come.

 Guest Contributor

Charles Hoyt blogs about financing at for mckinleyplowman.com.au. If you’re getting your business ready for tax season, look into more information at http://www.mckinleyplowman.com.au/content/migration/uk_pension_transfers/67.

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6 Tips to Save on Back-to-School Supplies

June 28, 2011 By Leave a Comment

Pencils, crayons, pens, and notebooks mean it’s that time again! All parents know that back-to-school shopping can add up quickly. However, there are things you can do to minimize the cost. This school year, save yourself some money with the following tips.

1. Stick to the list. Any item not on the list provided by your child’s teacher probably isn’t needed. Although kids may beg for extra supplies, make a rule that if something isn’t on the list, you won’t buy it. They can have fun picking out the items that are actually needed.

• If a list wasn’t given out before the first day of school, there’s no need to get carried away and purchase a bunch of stuff your child might not ever use. Get the list as soon as possible; you’ll be in a position to pick up items when they’re on sale.
• Contact the school or look at the school’s website if you haven’t received a copy of the list. Many schools now provide a downloadable version on their website.

2. Shop at home first. You likely have several things at home that can be used. Look in your office for pencils, pens, unused notebooks, notebook paper, and more. Remember to check your child’s book bag, crayons, lunch box, and anything else that comes to mind.

• Items like pencil boxes, pencil sharpeners, and scissors can probably be used for years before they need replacement.

3. Consider the source. Many parents immediately think of large super-stores as the best source of school supplies. Remember to consider the offerings of drug stores and even grocery stores.

• Frequently, these less-considered stores can have spectacular sales on many back-to-school supplies just to get shoppers in the door. Check out newspaper inserts and mailed circulars to find out about drugstore sales.

4. Watch for the sales. As the calendar closes in on the beginning of the school year, keep your eyes open. Sales abound, and the smart shopper will be on the lookout for the best deals. Often one store will have notebooks on sale for one cent, while another will have a great sale on pencils.

• Using coupons wisely can save you a ton of money.

• Even if a coupon comes out after you’ve made a purchase, stores will typically honor them. Take your receipt and the coupon back to the store and get that better price.

5. Do you have a tax-free holiday? Many states have tax-free holidays around the start of school. Make sure to check whether your state has a tax free holiday and go shopping during those times.

6. Team up with another parent. By joining forces with another parent, you have the opportunity to purchase items in bulk at reduced prices. Then divide up the supplies and the savings.

Back-to-school time is exciting for everyone, but for parents it can also be a financially stressful time of the year. But school starting doesn’t have to break the bank. Get your supply list, stick to it, and focus on saving money by following these tips. This school year might cost you less than any other.

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How to Save Money on Back-to-School Clothes

June 14, 2011 By 1 Comment

Every year parents deal with the challenge of buying back-to-school clothes. Stores are crowded, items are expensive, and you know your kids will probably outgrow everything before the clothes wear out. But there are things you can do to minimize the cost and avoid the crowds.

1. Set a budget. As with anything else, the first step to limiting how much you spend is to set a budget and actually stick to it.

• Consider how much you’ll need to spend up front as well as what will be required for purchases during the school year. Stretch that budget as far as possible by only buying what you really need and by shopping when the sales occur.

2. Assess your current situation. What does your child currently have? What fits? What can be reused for the new school year? Figure out what you’re actually going to need, make a list, and keep it with you.

• When anything on your list goes on sale, you’ll be in the position to take advantage of the situation.

3. Consider hand-me-downs. Do you have older children whose clothes would be appropriate for your younger child? What about the children of your friends, neighbors, and co-workers?

• Many people just throw perfectly good clothes in the trash. You may be pleasantly surprised at what others may offer you, and usually everything is free!

4. In the spring, buy winter clothes for the next school year. Winter styles are amazingly inexpensive in March. So buy ahead.

• Of course, the same situation applies when buying clothes for the rest of the year. Out-of-season clothes are much less expensive. The stores want all that merchandise out of their way.
• Remember to consider your child’s growth.

5. Consider buying used clothes. Your kids might not be thrilled if they knew, but thrift stores and consignment shops have many pieces of clothing in excellent condition. Some are designer items that cost a ton of money new.

• Much of the apparel has only been worn a couple of times, and it’s not unheard of to find stuff that’s never been worn. Your kids will never know, but your bank account will be able to tell the difference.

6. Trade in the old clothes. Many stores like Once Upon a Child and Plato’s Closet specialize in used clothing. Not only can you get some money for those clothes your child can no longer wears, you might also find a great price on something they’ll love!
• Also consider selling last year’s clothes at a garage sale or on eBay. Your child’s old clothes may have value to someone, especially if they’re in good condition.

7. Check to see if your state has a back-to-school tax holiday. Some states have a couple of weeks or weekends before school starts when they temporarily eliminate sales tax.

• The amount you save can be considerable, so check if your state has this tax break before you plan your shopping trips.

If you utilize the above money saving tips, you can save a lot of money on back-to-school clothes! Follow at least a couple of the suggestions in this article and you’ll be well on your way to having a happy, well-dressed child and keeping more of your hard-earned money in your pocket.

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3 Tips for Living Well Beneath Your Means

April 13, 2011 By Leave a Comment

Contrary to popular opinion, the key to financial freedom isn’t solely based on the amount of money you bring into the household each month. It’s about learning how to manage your money and prioritize your spending. This is also known as living beneath your means.

Below, you’ll find some great suggestions for living beneath your means in order to build savings. You won’t have to move into a shoebox or completely forgo entertainment and shopping – but the tips below will help you learn how to make better spending choices.

Consider these strategies:

1. Have a slice of humble pie. If you’re constantly in a competition with your neighbors, coworkers or friends, you’re never going to stop spending. In the back of your mind, you’ll always try to “beat” them by having the newest car, biggest house, most expensive clothing, and more.

• Once you eject the competitiveness from your mind, you’ll be able to effectively trim the fat from your budget.

• If you’re a smoker, now is the time to quit. If not for your health, do it for your financial future. In some states, a pack of cigarettes can cost $10. If you’re a pack-per-day smoker, you can save $300 per month by ditching this harmful habit.

• Work with what you have. There’s no need to upgrade your car if the one you’re driving now gets you from point A to point B. If your current home isn’t to your liking, make some updates or redecorate – it’s a far less expensive fix than purchasing an extravagant estate.

    2. Trim your grocery budget. Coupons aren’t the only way to save money on your grocery bills (though they certainly help). You just need to be conscious of your purchases. It’s possible to feed a family of four for under $10 – with a high quality meal to boot!

    • Never go grocery shopping hungry or tired.

    • Three nights per week, cook up something very inexpensive for dinner, such as beans and rice or homemade soup. It’ll be a nice change of pace, without feeling deprived. And of course, the biggest bonus is that you’ll save money!

    3. Make savings a priority. Savings isn’t optional. It’s necessary for financial emergencies – and they always come up in some form or another. Treat it as any other bill each month. Place this, as every other bill, in your budget workbook. You do have a budget workbook, don’t you?

    • If you’d like, break it up into pay periods. In order to save $800 per month in a 2-income household, each partner would have to set aside $100 per week. A $400 goal would be just $50 per week. When a savings goal is broken into manageable pieces, it’s a far less daunting figure.

    • When you’re unable to meet your savings goals, either find a way to make more money or spend less money each month. If you’re able to trim the fat from your monthly expenses, there will always be a way to meet your savings goals.

    • Budget your “fun money” as well. When you budget a set amount for unnecessary shopping trips and entertainment, you can’t shop until you drop. When the money runs out, you’re done.

      Your entire life doesn’t need to change in order to live below your means. It’s all about minimizing your expenses where possible and refusing the urge to live larger – even if you have the means to do so. By implementing these simple tips, you can slash hundreds of dollars – if not more – off your monthly bills and stash it into your savings account!

       

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      Use Your Car Less and Save Money and Be Healthier

      March 21, 2011 By Leave a Comment

      Automobile emissions contribute a considerable amount of air pollution and the accumulation of greenhouse gases. The less you use your car, the better it is for the planet and the more money you can save on car expenses – particularly with the price of gas going up and up and up.

      But it’s not only gas money you save when you cut down on the use of your car; your tires last longer and you can go longer between oil changes and other maintenance as well.

      Reducing our automobile use is something we can all do to improve our air quality, the health of our planet, and our pocketbook.

      Carpooling

      Not only can carpooling reduce the number of cars on the road, but many urban areas have faster lanes designated just for cars with multiple passengers. See if any of your neighbors want to get together and share a ride to the grocery store or the mall. Maybe some of your co-workers live nearby and would like to share a ride to work – you can alternate drivers daily or weekly.

      Walk or Bike to Work

      Consider walking or biking to work if the weather and your situation permit it. You’ll not only use your car less, but you’ll improve your health and fitness in the process.

      You might even be able to ultimately get a reduction on your health insurance premium if you’re currently overweight and you lose the extra pounds by walking or biking to work.

      Use Public Transportation

      Check your local public transit information for schedules of buses and trains that serve your area. Typically these services hit the high traffic areas like shopping centers and downtown areas.

      While it may be less convenient, you may be able to largely eliminate your dependence on an automobile. Take advantage of not having to drive by using the time to read or listen to your iPod.

      Telecommuting

      Telecommuting can be a great way to minimize your car usage. Ask your employer if you can stay home one or more days a week and work from the comfort of your home office. Saving the time and cost of your commute are added benefits.

      Consolidate Trips

      Many of your shopping destinations are located centrally. The goal is to do all of your shopping in one trip. You can do your grocery shopping and buy your clothes as part of the same excursion. Again, you’ll be saving time and saving money on gas.

      Reducing your dependence on your car can go a long way toward contributing to improving the air quality in your area. All of these ideas will not only lessen the use of your automobile, but they’ll also improve your life by saving money, saving time, or strengthening your health.

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