TURN KEY MARKETING SYSTEM 4 U

Most people don’t realize that taxes are their biggest expense.  Take a look at your pay stub and add the amount of tax that was taken out for federal, state, local, FICA and Social Security and multiply that by the number of checks you get per year.  Then add any additional money you paid on April 15 or deduct any refund you received and that is the total tax you paid.  Shocked?  I was.  I realized I work every year until the first week in April for the government and that is when I started looking at a home based business.  The tax benefits of having a home based business are enormous.  I started my home based travel business in January of 2007 and as a result, I worked only 1-1/2 months for Uncle Sam instead of 4 and cut my tax liability at the end of the year in half.   Bear in mind that in order for these expenses to be deductible you must show a PURSUIT OF PROFIT.   Treat your business like a business and the IRS will too, but if you treat it like a hobby, the IRS will do likewise. 

While it is ALWAYS advisable to get advice from your accountant,  I am going to show you some ways a home based business can help you:

SET UP A HOME OFFICE AND DEDUCT CERTAIN HOUSEHOLD EXPENSES:  All you have to do to qualify your home with the IRS as the location of your home based business is to (1) Actively pursue the business with the intent of making a profit.  (2) Devote more than 10 hours per week to your business and (3) Set aside a specific portion of your home to use exclusively for business.  Household expenses that are deductible include utilities (we will discuss in another paragraph), the business portion of your mortage interest and real estate taxes, depreciation or rent, insurance and repairs.  Even having your house cleaned weekly can be a deduction if you can show it is necessary to perform your business.  EX.  I have an online travel business. Most of my business is generated online and I never even know who my customers are much less see them.  However,  I still maintain an office whereby my clients can come and sit down with me for me to help them plan their trips; accordingly, it is necessary for me to keep it clean and nice just in case.  Do you get my drift?

HIRE YOUR SPOUSE AND/OR CHILDREN:  You can also hire your spouse and/or children to work in your home based business and the money you were giving him or her for household expenses and/or allowances become a tax deductible salary.  But, make sure your spouse’s pay is comparable to the industry levels for similar jobs and you set their pay up like a regular payroll both deducting and paying payroll taxes, otherwise the deduction could be disallowed.  

Instead of giving your children an allowance, have them take out the trash, answer the phone, vaccuum and anything else they could do.  Pay them a fixed salary by the hour.  Although the standard deduction is adjusted for inflation annually, unless you pay them an enormous salary it is quite conceivable their income would be tax free.

UTILITIES:  Remember to keep records from your utility bills as a portion of those are tax deductible as well.  Your phone bill is NOT deductible, but you can deduct any long distance bills or long distance flat rate you pay.  Also,  your cell phone is deductible as long as you use it for business and you can justify that simply by putting your cell phone number on your business cards.

VEHICLE EXPENSE:  When you use your personal vehicle for business, your vehicle expenses are deductible as well.  You can either choose actual expense or mileage, but you must continue to use the same method year after year.  Personally, I recommend mileage because mileage is the only record keeping you have to do.   It is advisable to keep a diary in your car and write down all of your mileage and the purpose of every trip.  If while you are out you suddenly remember to a business errand you need to run or you share your business with someone, you are a step ahead of the game.  And, with the mileage deduction being .50 a mile, the amount of the deduction can add up quickly.

NECCESSARY, REASONABLE AND ORDINARY EXPENSES: As a business owner, you can write off all of your expenses that are considered necessary, reasonable and ordinary in the course of conducting your business and pay taxes only on the rest.  When researching a home based business, I suggest you pick a business that is most in line with your interests and lifestyle so that the things you do anyway become a part of your business and therefore the money you already spend becomes a tax deduction.

Example,  my husband and I really like to travel.  Accordingly, we chose to start an online travel business for our home based business.  As Referring Travel Agents, not only are we doing something we enjoy doing, but because travel is our business, most all traveling we do is tax deductible.

As home based travel agents, we can justify even our family vacation as a tax deductible expense.  Everywhere we go, we go with the thought in mind that we are looking at this place for our business.  We take good notes about our likes and dislikes which becomes a part of our permament business file just in case the IRS comes knocking on our door.  We do that for the airline (if we fly), the motels we stay in, the restaurants we eat in, and any places of entertainment we attend.  Not only does this help us on our taxes, but it also helps us to become knowledgable about the industry we are selling and when a client inquires about a particular destination we give them a first hand account.

And the best part is at the end of the year, if our business actually spends more than it brings in, not only do we not have to pay any taxes from our business income,  we can also write off  whatever “loss” there is against the income we make in our full time jobs.  With enough business expenses, we could pay virtually no income tax whatsoever thereby making every day Tax Freedom Day for us.    Think about what that could do for you???

EATING OUT:  Everytime we go out to eat I share my business with the waiter or someone sitting near us which makes our dinner a business expense.  If I can support the expense with documentation, the government will let me deduct 1/2 of the dinner’s cost.  Trust me,  we eat out a lot.

Think about it, I am spending the same dollars I have always spent, its just now I have given them a clear business necessity and they are tax deductible.  You see, as a home based travel agent, I can now take advantage of the same tax opportunities as my friends who own  manufacturing business.  The only difference is they have millions invested in their business and I only have a few hundred invested in mine.  I get to take advantage of the same tax deductions they get to take and soon, I will be generating the same kind of income they are generating. 

Warren Buffet is in a lower tax bracket than most people who live pay check to pay check and yet he makes $170 Million per year.  How do you think he does that?  Simply by incorporating into his life some of the same strategies I am telling you about today.  This is also one of the reasons that Donald Trump has said if he were starting in business today, it would be in multi-level marketing. 

I don’t know about you, but for me it just makes sense.  Money in my pocket goes a lot farther than it does in Uncle Sam’s pocket.  Up until the last few years the average person’s only option was to  pay the taxes.  Now, we have at our disposal the ability to market whatever we want to market around the world.  If for no other reason than the tax benefits, I encourage you to consider starting a home based business today.

Remember, all you have to do to satisfy the IRS is to ”show a pursuit of profit” which can be done simply by having business cards printed up and keeping good records.  But, if you’re like me, once I got started in my home based travel business, I love the business so much that now not only does it provide me with some good tax deductions, but it is also well on its way to providing us with the lifestyle we have always dreamed about. 

If you are looking at a home based business but just don’t know which to choose, let me encourage you to do your research.  Even though we like to travel, before we went into the travel business, I did my homework.  I found out that travel is a $7 trillion a year industry and is growing 23% faster than the global economy.  I also found out that it is the fastest growing commercial internet segment and  is expected to double in the next 10 years.  Because of my research, I know that it won’t take long before I can live the good life selling travel.  I have stopped working for Uncle Sam for at least 3 months each year and selling travel is making a difference in my life.

Everyone goes into business because they have a “why”.  One of your “why’s” should be to lower your tax liability.  Regardless of what business you choose, you will be a better steward of your money than the government will be.  If you haven’t considered a home base business, consider it today because it is a very low-risk, high return method to create personal wealth and to lower your tax burden.