There are many different measurements of profit that can cause confusion while presenting the financial statements. Our main goal here is to explain how to use the three types of profit and the differences between them in the most simple way possible.
What is the Small Business Home Office Safe Harbor Deduction
The new business use of home safe harbor option has revolutionized the much maligned home office deduction. I am sure that many of you were like me when I start my small business, scared to death of the IRS. Currently, I run my CPA / Virtual CFO firm out of my home office so this is an essential deduction.
It was common practice for many accountants to talk clients out of the home office deduction because the IRS continually scrutinized the deduction. However, in 2013, taxpayers are generally permitted to use a simplified method of calculating home office deduction. Even now, when I talk to clients, they want to know how does the home office safe harbor work. Should they be willing to take the deduction?
Health Savings Account (HSA) Option for Small Business Owners
In my opinion one of the scariest things about being self-employed is health care coverage especially if you have a family. Obtaining reasonable health care coverage with affordable premiums is a problem that plagues many small business owners since you will probably end up with a high deductible plan. With that said one of the best things that you can take advantage of is the Health Savings Account (HSA). Another huge issue is choosing a HSA Bank. Continue reading
So what is a 1099 form? The dreaded Form 1099-MISC may be one of the worst, most-time consuming requirements that the IRS puts on small businesses. However, we are all compelled to send out the forms although if I was you I would outsource the crap out of it. Even if you outsource the filling-out and submission of the form it is essential that you understand the why and how. Continue reading
There are many reasons that keep people from starting a small business and taking control of their lives. I want to give you nine steps that you need to follow when initially starting a small business. The goal of this is to relieve anxiety caused by the fear of the unknown in regards to state and federal agencies. Continue reading
I was thinking about family financial planning and wanted to make sure that you were aware of a couple really good college education savings options. This has been a topic in my household as our oldest child has started preschool so now the private school and college planning has unfortunately become a reality. I had to pay some homage to Ohio State with the picture on this post since it relates to college savings. Continue reading
Standard Deduction vs. Itemized Deduction
There is often confusion during tax time when talking about how or when to take itemized deductions. The standard deduction is applicable only if it exceeds a taxpayer’s allowable itemized deductions. The basic standard deduction depends on your filing status and is adjusted for inflation. For 2014, the standard deductions are:
- $12,400 married filing joint
- $6,200 single
- $9,100 head of household
- $6,200 married filing separately
I am sick of watching the various reasons small businesses fail. In many small towns we see dreams crushed over poor financial decisions. I know accounting is not the sexiest thing however it can really hold a small business owner back. Continue reading
High W2 Income Tax Planning. Earning a high W2 income is both a blessing in the economic sense and a curse when talking taxes. In the current environment making more money means paying additional taxes. This is especially true starting in 2013 with two new taxes for high wage earners. Continue reading