An oft-forgotten financial perk you get by owning your own business is the money you DON’T spend…for example on Taxes.
Non-Business owners, do the following:
This means, things are purchased with “after-tax” dollars. So, when you think about how much you paid in taxes, the stuff actually costs more than the price tag you see at the store!
A Business Owner does it this way:
This way, purchases are made with pre-tax dollars. The difference, between the two?
The business owner gets tax deductions for buying stuff he was likely already going to buy. For example:
- Cell phone charges
- Internet connection charges
- Telephone add-on services(3-way calling, voicemail, etc.)
- Office supplies(paper, pens, pencils, envelopes, stamps, print cartidges, etc.)
- Computers and Printers(to the extent they are used for business activities)
- Car expenses(50 cents per mile when using your car for business-related activities) (2010 IRS business-mileage rate)
- Meals (when entertaining clients)
- Entertainment(sporting events, golf, etc. when entertaining clients)PLUS- most of the expenses you incur in starting and marketing your business, such as:Advertising Expenses
(business cards, flyers, classified ad charges, websites, marketing materials)Business Start Up Costs
(Training Materials, business start-up fees, certification classes
Plus, in certain cases you can deduct part of your home mortgage, utilities, etc.
Although you may not make tons of money in your first few months with your own business, you could end up with a nice refund check thanks to business deductions- which is extra money in your pocket! That’s just one reason why I love being a home business owner!
*Note: This is not intended to be used as tax advice. You will need to speak with a tax advisor about your particular circumstances
To Your Success,