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It’s Not Too Late to Implement These Tax Savings Tips for 2011

It’s hard to believe we’ve approached the end of another year; I don’t know about you but I seem to lose track of time the older I get!

Generally, it’s about this time that people start thinking about the upcoming year and their goals and/or resolutions for the next twelve months. However, there is ONE date that people generally DON’T want to think about and that’s the dreaded April 15th (actually you’ve got until April 16th since the 15th is a Sunday next year)!!

Now, there are two ways to approach this time of year:
1. You can stick your head in the sand and pretend that somehow April 15th won’t arrive OR
2. You can take a proactive stance and perhaps still save yourself some money in 2011

Which would you prefer?

If you’d rather stick your head in the sand, there’s not much I can do to help you and you might as well stop reading this post right now; however, if you’d like to save some of your hard earned money, let’s get started…

If you own your own business, here are a couple of ways that you can save money for 2011:

• If you expect your 2011 income to exceed 2010, are there 2012 expenses that you can accelerate and pay before December 31, 2011 to soften the blow or
• Are you still expecting income to arrive before December 31st that you could shift into 2012, achieving the same tax savings affect?

In summary, accelerate expenses or defer income, if possible.

If you don’t own a business, that’s OK; you can save some money, too, prior to the end of the year:

• Are there charities that you’d like to donate to? Make sure the checks are dated prior to December 31st. You can save additional money if you live in one of those states that allow a credit for donations to certain charitable organizations.
• Are you one of the lucky few anticipating a bonus for 2011? If you haven’t prepared for that additional income, it could push you into a higher tax bracket; is it possible to defer until 2012?
• Have you had years of stock losses piling up? Normally, you can deduct only $3,000 per year max of those accumulated losses; however if you’ve finally got some winners resulting in capital gains, you might want to think about selling before December 31st to shelter those gains with your accumulated losses.
• If you have an IRA, you have until April 16th, 2012 to make a 2011 contribution; if you’re under the age of 50, you can normally contribute a maximum of $5,000; for those of you 50 and older, you have the opportunity to contribute a maximum of $6,000. Consult your tax advisor about your eligibility to contribute as there are restrictions.

Here are just a few tax savings tips; this list is not meant to be all-inclusive and I strongly suggest you consult your own tax advisor before implementing any of these strategies.

I wish you all a Happy and Prosperous 2012!!

Photo credit: thedailyhamster

Diane Aksten has been a CPA for the past 22 years specializing in taxation for individuals and small businesses. She is the co-founder of Women Empowered Businesses (WEB) which assists women in launching and growing successful home based businesses.

Disclaimer: The information contained herein is for informational purposes only and is not to be construed to represent tax or legal advice. You should consult your own tax advisor to determine whether you and/or your business are entitled to the tax deductions mentioned in this post.

Setting Up Your Home Office Part 2

Setting Up Your Home Office Part 2

by Heather Doering

Part 1 of this article talked about selecting and setting up a dedicated work space.  Next, we’ll discuss equipment and resources.  Most home offices require a few basics:  a computer, a phone line, a printer, and internet service.  And finally, we’ll talk about human support – people resources are essential to a home office.

The phone line has a couple of key purposes.  First, you’ll need to be able to make and receive calls and have a voicemail system of some sort.  This can be accomplished either through a land line or a cell phone.  Many people are choosing to give up the land line option.  In the past, fax machines have needed a land line to work.  New technology, which I have not yet tried, promises to alleviate the need for land lines when faxing.  Dave Roos has written a great article describing how to use your camera phone for scanning, copying and faxing:   http://home.howstuffworks.com/scan-fax-using-camera-phone.htm

Printers are a necessity for just about any office, home or otherwise.  There are 2 types of printers:  inkjet, which tend to be very inexpensive, and laser, which typically cost more out the door.  While inkjet printers cost less initially, the ink can be expensive.  Laser printers make a good choice if you’re going to be doing a significant amount of printing.  Today’s printers come with almost as many options as toothpaste – many print, copy, scan and fax, all in one machine.  All-in-one’s are great, as long as you’ll use the technology.  As you contemplate printer choices, talk to an expert to discern your needs.  A qualified salesperson should be able to guide you toward the best choice for your business.

The last office basic is the computer.  Computers run our world and our businesses, too.  Before purchasing a computer, do a little homework.  Assess your needs – what will you use the computer for?  Word processing and basic spreadsheets?  Media and video processing?  Online ordering?  Blogging?  Will you be mobile or stationary?  You can purchase a decent computer quite inexpensively.  If you plan on mobile meetings and travel, consider a laptop.  If you’re totally office bound, a desktop might be a better choice.

Be sure that the computer you select will meet today’s needs and give you a little room to grow.  My last laptop, while only $250, was very slow and needed a new motherboard ($150 for parts and labor) after 14 months.  I recently ordered a Dell Vostro (and gave the cheap laptop with expensive repairs to my kids) , which allowed me to build a computer to meet my specific needs.  Again, talk to a computer expert so you aren’t paying for options you’ll never use.

Finally, surround yourself with people who are good at what they do.  A local IT person can save hours of headache; the corner printing company will often allow customization not available through giant online corporations; a shipping store can provide stellar customer service while meeting all of your needs.  Ask for referrals from colleagues and friends.

You now have the know-how to set up your home office!  Get to work!

 

Heather Doering is a certified life coach and co-founder of Women Empowered Businesses.  She has over 10 years in direct sales and is mom to 2 wonderful boys.

Let Uncle Sam Pay YOU for having a Home Office

In Part I of her series, “Setting Up Your Home Office”, Heather talked about the importance of finding a space in your home that will allow you to operate your home based business with a minimum of interruptions; she also shared some great resources for furnishing your office space (sounds like her personal favorite is Ikea!!) In this post, I’m going to tell you how that space in your home and the office desk and chair you bought can save you money at tax time.

One of the great advantages of being a self-employed home based business owner is that the IRS allows you to claim deductions for certain expenses that non-business owners can’t; maintaining an office in your home is one of those instances. According to IRS Publication 587, Business Use of Your Home,

“in order to deduct expenses for the business use of your home, you MUST use part of your home exclusively and regularly as your principal place of business…”

Let’s first define what the IRS means by “exclusively and regularly”; while you no longer must have a separate room in your home to qualify, you must have a specific area devoted ONLY to conducting your business. This isn’t an area for your kids to play on the computer or do their homework; this space must be used ONLY for business activities.

Second, your “principal place of business” MUST be your home office; you will not qualify to deduct your expenses if you have access to another location in which to conduct your business. Your principal place of business is the location in which you conduct the majority of your business.

OK, let’s talk about that office desk, chair and laptop computer you bought for your business; did you know you can deduct these items as business expenses? The IRS actually gives you three choices:

• Elect a Section 179 deduction for the full cost of the property
• Depreciate the property over the prescribed useful life
• Elect Section 179 for a portion of the total cost and depreciate the balance

Section 179 is the IRS code section that allows you to deduct the cost of the property IN FULL in the year of purchase (subject to certain restrictions). Section 179 is an election, meaning that it is NOT a requirement; if you wish to depreciate the property over the useful life of its existence, you have the option of doing so. You can also combine the two alternatives by electing Section 179 treatment for a portion of the property cost and depreciating the remainder (again, subject to certain restrictions).

Who ever said Uncle Sam wasn’t generous!!

Diane Aksten has been a CPA for the past 22 years specializing in taxation for individuals and small businesses. She is the co-founder of Women Empowered Businesses (WEB) which assists women in launching and growing successful home based businesses.

Disclaimer: The information contained herein is for informational purposes only and is not to be construed to represent tax or legal advice. You should consult your own tax advisor to determine whether you and/or your business are entitled to the tax deductions mentioned in this post.

Welcome to WEB! Women Empowered Businesses

Our Vision

WEB endeavors to connect with, inform, educate, and inspire women to grow successful direct sales and multi-level marketing businesses, whether just starting out or a seasoned business owner. How can WEB help?

Educate – learn the ins and outs of starting a home based business

Inform – Keep up on the latest trends and information

Inspire – Discover belief in yourself and help others find the same

Connect – Join with a WEB of women who celebrate your success

Our Services

WEB partners with groups and individuals

• “Smart Taxes for Smart Women” designed for brand new and seasoned consultants
• Life Coaching to help women balance working from home and family commitments
• Group and individual consulting services
• Speaking engagements for groups from 10 to 10,000
• Seminars designed to assist women in choosing the RIGHT opportunity for them

Home

 

Meet Heather and Diane

Heather Doering and Diane Aksten had one purpose in mind when they founded Women Empowered Businesses, LLC (WEB) in mid 2011: to help women launch and grow successful home based businesses.  After conducting some initial research, they discovered that there were limited resources in existence for the thousands of women who entertain the idea of having their own home based businesses but don’t know which opportunity is a good fit for them.

Whether your passion is jewelry, home furnishings, candles or easy to prepare gourmet food, there are hundreds of great companies that provide an opportunity for you to make anywhere from a few hundred dollars a month or more; the sky’s the limit!!  But how do you decide?

That’s where we come in; via teleseminars, live events and other training tools and resources, WEB helps you de-mystify the process of choosing the right company BEFORE you sign on the dotted line.  Here are just a few of the services we offer:

 

• Information to help you choose the company that’s a fit for you based on your personality, financial goals and time availability
• Coaching that takes your business to the next level
• Group and individual consulting services
• Our “Smart Taxes for Smart Women” service is designed to provide you with the tax information you’ll need to start your home based business off on the right foot

 

Heather and Diane have over 25 years of combined experience—Diane as a licensed CPA for 22 years specializing in taxation for individuals and small business owners and Heather as a successful direct sales leader and trainer for over 10 years who has achieved national recognition.

WEB is passionate about helping women achieve financial freedom and the founders fervently believe that empowering women to succeed through home based business ownership is one of the most gratifying paths to personal freedom, financial and otherwise.