Top 7 Small Business Tax Tips

Here are seven ways for owners of small businesses to save money on their taxes.

1. Incorporate Yourself: If you`re still a proprietor or partner of a business, it`s time to incorporate yourself. Not only will you limit your liability, but you may enjoy lower tax rates on small business income and other tax advantages as well.

2. Be Home Based: If possible, continue (or switch to) being a home based business. Not only will you keep your overhead down, but you will be able to write-off (or deduct) the business use of your home.

3. Income Split: Pay reasonable wages to your spouse and children. In this way, you can legally divert income taxed at your higher rate to your family members that are in a lower tax bracket.

4. Rearrange Your Affairs For Maximum Tax Savings: Can you make some changes to turn your hobby into a moneymaking business? Can you use that extra room in your house as a home office for your business? Can you arrange to use your car more for business purposes? Can you arrange for more of your entertainment expenses to be business related?

5. Document Your Expenses Well: Do you document your expenses well so that they would survive a tax audit? Have you kept a mileage log so that you can prove the percentage business use you claim for your vehicle? Have you kept receipts for all your entertainment expenses and listed the business purpose on the back of each receipt?

6. Be Punctual: File all returns and pay all taxes due (income, payroll, sales, et cetera) on time. This way, you avoid expensive late filing (and payment) penalties and interest.

7. Develop a Tax Planning Mindset: Some people only worry about their taxes during tax season. However, you will save a fortune in taxes, legally, if you make tax planning your year-round concern. Do you make business and personal purchases, investments, and other expenditures with tax savings in mind?

RESOURCE BOX:

J. Stephen Pope, President of Pope Consulting Inc., http://www.popeconsultinginc.com/ has been helping clients to earn maximum business profits for over twenty-five years.

For valuable Work at Home Small Business Ideas, visit: http://www.yenommarketinginc.com/

In The News:


Finding the PERFECT Alliance Partner

Where do you look for the appropriate alliance?One of the... Read More

7 Tips to Improving Your Cash Flow

Cash is King... That is what everyone tells us and... Read More

Make Your Business More Profitable

More sales and more profit. Isn't that what you want... Read More

The Care and Feeding of Your Small Business

While I was hard at work last week, an everyday... Read More

Effectively Completing the Operations Plan Section of Your Business Plan

The Operations Plan is a critical component of any business... Read More

Fire the CEO

If you are the boss and you think your job... Read More

6 of 1, Half Dozen of the Other

Motivational author and speaker Jim Rohn says that for a... Read More

How to Write a Credit Policy for Your Business

The book, "Become the Squeaky Wheel," by New Hampshire author... Read More

The Business Autopsy: A Fact Of Life

Last week we discussed the importance of performing an autopsy... Read More

Are You Satisfied With Your Business Just As It Is?

Did you know that satisfaction is the number one emotion... Read More

Personal Success - Take a Break from Business

Have Some Time to Yourself One of the most important... Read More

A Great Logo Is A Marketing Must-Have. But Is It Affordable For Small Business Owners?

And is having a logo really that important?My answer to... Read More

11 Things Small Business Owners Can Learn From The Supreme Court

1. Have A Strong Constitution ? Justices deliver decisions by... Read More

Want to Grow Your Business? Make an Irresistible Offer

My clients and many of my readers are small and... Read More

Is Brick and Mortar A Passing Fad?

Q: Is the online world the best place to sell... Read More

How to Promote Your Business by Entering Contests

You are probably hard at work promoting your business (and... Read More

Boston Suburban areas a good choice to run a business

BioTechs even with the latest news had shed over 1000... Read More

Practical Money-Saving Tips For Small Businesses

One of the primary concerns all small businesses have is... Read More

Accepting Checks in Your Business Virtually Risk Free

Most businesses accept checks as form of payment for goods... Read More

3 Ways To Make Certain Your Business Fails

Most small businesses incorporated in 2005 will fail by the... Read More

Racing the Competition

What is the Big Race all about when it comes... Read More

5 Tips for Hiring a GREAT Bookkeeper

Bookkeeping?the "dreaded" word is something we all have to worry... Read More

Proper Care and Feeding of the Business Owner

That sizzling sound you're hearing may be a symptom of... Read More

Tips on Setting Up Your Small Business Bank Account

One of the first things you will need to set... Read More

Change May Be Your Ace in the Hole

Whether it has been thrust upon you by external market... Read More