How Does Social Security Effect Your Taxes
Posted by admin on May 25, 2008
Social Security is less than an ideal situation for most small business owners. That is because if you are self employed, then you will still need to file social security for you and your employee (you also being an employee.) That means that you have to file at twice the amount. This means that you would be filing at 15.3 percent instead of half of that of all of your net profits.
Social Security is not something that you can mess with either as it is highly tracked throughout the system. Yet, there is some good news for those filing their personal income taxes. You can deduct half of your contribution of your Social Security investment onto your Form 1040.
Be sure to talk to your tax professional about this scenario. Most small business professionals don’t realize this stepping into their business.
Deduct Your Retirement Contributions Yet?
Posted by admin on May 14, 2008
Many people think they have to work for a company instead of starting their own business because they do not think they can have their own retirement plan or get the benefits from it that other employers get. The fact is, you can! In fact, if you are self employed there are benefits to having your retirement plan up and running on your own.
If you have a SEP-IRA or a Keogh, then you also have a potential deduction. You can deduct your contributions on your personal income tax return. These plans are rather straightforward and simple to set up. Once you do, you have the ability to take advantage of this benefit in the long term. Talk to your financial planner about how to set up and manage these types of accounts. You may be surprised by how much you can save by saving in this way.
Do You Need Health Insurance? Deduct It
Posted by admin on May 10, 2008
For those that are self employed and paying their own health insurance premiums, the benefit could be in the form of a tax write off. The costs are 100 percent deductible to you. This only applies to certain scenarios such as those that are in proprietorships. There are also limits. For example, you can not deduct more than your business brings in as profits. What’s more, you can not qualify for this if you qualified for other types of health insurance coverage, say from your spouse.
What’s more, if your spouse is working for you, legitimately, then their premiums can also be deductable as can any of your children’s if in fact they are on your spouse’s policy. Do be careful with this write off because not being authentic here could cause you an audit or a lawsuit if you do not provide fair coverage to all those you work with.
Stay At The Hilton But Eat At Mc Donald’s
Posted by admin on May 4, 2008
That’s the best way to get the most out of your tax deductions when you are traveling on business. The fact is that your travel accommodations, such as your hotel room, are 100 percent tax deductible when they are fully business related. Therefore, take full advantage of this by staying at the best hotel you can. Even the cost of your travel, such as the car ride or the airfare is also 100 percent deductible.
Fly first class or drive in a luxury car.
But, only 50 percent of the cost of your meals on the road is deductible. That’s where you may want to stick to the lower end if you are on a budget.
Each of these costs does require that you have accurate records kept. When you are traveling, take into consideration what costs you have including things like your dry cleaning, your tipping expenses and the tolls you pay. It all adds up!