Monthly Archives: February 2008

Scam Alert – J. Paul Getty’s family giving way money?

The Work-At-Home Scam Prevention site is up although not quite completed. I did want you to check out this post about an email I received asking if I could help move J. Paul Getty’s son’s money for 30% of the pot ($25 mil).

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Start a Business, Save on Taxes

Let me start by saying that I’m not a tax epxert. I’ll also add that I don’t like doing my taxes because as a home business owner, I find that they are little more complicated than when I had a job. But the rewards outweigh the work it takes to decipher the tax booklet’s instructions (they’re in English and yet it frequently feels like a foreign language).

I think everyone, whether they want to work-at-home full time or not, should have a home business simply because of the tax savings. Home business owners are eligible for deductions such as:

  1. Portion of mortgage or rent.
  2. Portion of utilities.
  3. Portion of Internet access.
  4. Some phone services.

The above list are thing you’re already paying and with a home business get an additional deduction.

Further, you can deduct business related expenses including mileage, professional dues, marketing costs, supplies, trainings, and more. In a job, you often incur fees in several of these areas (i.e. commuting) but can’t deduct them. But in a home business you can.

The other advantage is that in a home business, you pay taxes on income you earn AFTER subtracting your expenses. This doesn’t happen at a job. In a job, you pay your taxes on your gross income. But with a home business, you can subtract your business expenses from the gross, and pay your taxes on the net. For example, if you earn $1000 per month and pay 25% in taxes, at your job, your taxes are $250. But if you have a home business earning $1000 per month, and your expenses are $200, you pay taxes on $800 which is $200. That’s a TAX savings of $600 per year.

To learn more about tax advantages of having a home business, check out the IRS’s guides.

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