Simply Junior

Seeking tax advice and tax tips is never a bad idea. When it is time to file your home based businesses taxes online you want to have every weapon that is legally at your disposal. Having a list of acceptable deductions for your home business will allow you to quickly and legitimately flow through the tax season with little to no hiccups. Here are a few things to think about when beginning to file taxes online.

First, do you have a home office in the same way the IRS sees a home office? Is your home business run in one designated room in your home or are you working from the computer in your family room? If it is the later it is not considered a home office by the IRS. The room you run your business from must have no other use except working. If you do run your business from a singular room then the square footage of that room can represent the percentage of your mortgage or rent that can be deducted from your taxes. Also, the utilities that you use in your business ventures such as electricity and internet can be deducted. Typically a percentage of the total cost is deducted.

Second, what office supplies do you purchase? Even if you are not able to use the home office deduction, you can still deduct the office supplies that you purchase. Keeping well organized receipts will help you know what you can deduct and what you can not.

The third type of deduction is for office furniture. You have two choices when it comes to this deduction. One, you can deduct 100% of the cost of the furniture for that year. For that deduction, you would fill out the Section 179 deduction sheet in your tax form. In 2006, you could claim $108,000 in expenditures. If you don’t wish to claim the entire cost of your furniture that year you also have the option of depreciation, which allows you to deduct a part of the cost over a seven year period.

The other equipment such as computers, scanners, and fax machines can be deducted under the same principles as the office furniture. You would use the same Section 179 sheet to deduct these things. Any software or subscriptions used by your business can be deducted in the same way.

You can deduct any traveling you might do for your business but remember to keep accurate data of the trip mileage, tolls, or any other trip orientated expenses which includes your lodging and meal expenses. Only 50% of your meal expenses can be deducted. The IRS is a stickler for documentation, so have it readily available. You will also need to check what the gas rate was for the tax year in question and make the appropriate calculation. If you have purchased a vehicle, that too can be deducted. Just make sure to calculate the interest and depreciation for the vehicle.

There are several other deductions that you can find for a home based business. However, it is important that you make sure you follow the guidelines set forth by the IRS and they maintain documentation for everything that you are claiming.

When it comes to Christmas gifts, we spend lot of money buying them and giving them away to almost everyone we know. This is not the best thing to do.

We must always be careful about our expenditures especially on occasions like Christmas in which we spend from both hands. Remember, the New Year is also just on its way and we need to have enough savings for 2011 as well. So don’t waste all your money on buying gifts for all your relatives. Sure you want to buy something for your kids and wife but what about your aunt, uncle, their kids and their grand kids?

You can’t buy gifts for everyone; it’s going to wreck your budget. So plan about all these things well before Christmas so that you have got enough time in hands to prepare the gift items on your own instead of buying them from market and spending excess money aimlessly.

There are many gift ideas that are even present on the internet. If you have problems finding gifts on sale in your local markets, then you can easily search for them online and find the item that you want at the lowest price. You can also know the price of different gift items by searching for them on different stores online. This gives you an opportunity to buy well, and buy cheap!

You can get all you want and you can get it online so you don’t even have to go out. You never know if your relatives would even like the gifts that you are giving them and whether they will keep it or not. Of course you will know the taste of your family and you can get them anything that they want but you can’t do the same for all your relatives. There are many tricks and ideas that will help you cope with this problem.

You can do simple things like throwing a party and asking everyone to bring gifts. You can make a large pile of all the gifts and then play interesting and fun filled games like bingo etc and the winners get to have the gifts from that pile. In this way everyone can enjoy and you can’t get the blame if the recipient didn’t like the gift!

It is false to think that gift is the only way to make someone feel loved. If you remember someone on Christmas or even cook a nice meal for them at home, it is enough to make them feel the warmth of your love. You don’t have to buy large to make someone happy. All it takes are some little effort that is a sure short way to bring a smile on someone’s face.

There are many gifts that you can purchase or even pass on to your relatives if you don’t want them for yourself and are present at your home. This could include items like books, cards, photo albums and their favorite band’s CD. These are the things that you can be sure about that they won’t go to waste!

With today’s economy it is smart to watch your spending and cut out certain expenditures that you do not need. There are items that may seem to be insignificant but over time can add up to equal a significant amount of money. If you change your lifestyle or make changes in your normal routine you can end up saving a lot of money and make living in this economy a lot easier and more enjoyable.

An easy expense to cut out would be the amount of money you spend on eating out. If you buy lunch every day at or go out for dinner a few times a week you can easily save hundreds of dollars by packing a lunch or cooking your own dinner. On average if you spend $8 on lunch 5 days a week and $10 on dinner 3 times a week you would be spending $290 a month. Keep in mind $8 for lunch and $10 for dinner are very low prices. If you are eating out for lunch and dinner I would say $290 is a minimum amount you would be spending. If you were to pack a lunch and cook dinner you can save about half of that amount. An example of a cheap meal would be spaghetti; you can spend $5 and have a pound of spaghetti and a can of sauce. For one person that could last for 2 dinner and even a lunch. You can just turned $20 into $5.

Another expense that most people pay for on a daily basis is coffee. Although not a huge expense it can help pay one of your bills if it was cut out or made at home. Coffee can range from $2 to $5 depending on where you buy your coffee. If bought daily that is $60 – $150 a month just on coffee. By buying your own coffee and making it at home you can spend anywhere from $5 to $20 a month and have as much coffee as you want.

A third expense is gas and the easiest way to save on gas is to ride your bike if you destination is close enough. Not only will you save on gas but will lose weight, burn calories, and become healthier. This is probably the most unpopular way to save money but you can’t put a price on a healthier you.

These three simple ways to save money can end up saving you hundreds of dollars a month in expenses, and let’s be honest, who wouldn’t want to save a few hundred dollars a month? It’s may be worth a try and you may find you will actually like living this new lifestyle.

Saving money and investing it in a profitable vehicle like a savings account or in stocks and mutual funds is an art by itself. Most of us find it very difficult not to spend and save. One needs to perfect it the hard way.

I seem to have perfected this art over time. When I was young, all that I could think of was spending on fancy items that I did not need but felt the urge to do so. Many times I would spend recklessly without giving any thought to saving or investing my money.

With age, as the responsibilities and priorities changed, I became more aware of cost of living and pressures of utility bills and credit card charges. With this came the realization that I needed money for future security too, mine as well as my family’s, and I started giving a serious thought to investing my money so that it would grow, slowly and steadily.

If you come down to considering the bare facts, savings must precede investment. I came to realize this very early in life, that it is only after I save enough that I can think of investing my money.

With credit cards making it easier by the day to spend even from the comfort of your homes, it becomes all the more imperative that we make a conscious effort to save and invest. To make matters worse, the tempting advertisements being telecast to lure you into spending, make it all the more difficult to resist meaningless expenditures.

For saving money for investment, one has to be cognizant of the fact that there are alternatives to practically all urges to spend. A plain cup of coffee will probably give you as much satisfaction as an expensive espresso would. Grabbing a sandwich every time you feel the urge seems mundane and a necessary expense because you are hungry. If you pause a bit and think whether a packed lunch would have sufficed instead, you will easily realize that it would in almost all cases. Joining a library to read a book is a cheaper option than buying it. As it is, after you have read it, it is going to remain in the attic for long and ultimately you are going to consider a garage sale to dispose it off or donate to a library.

That is the hard way I came to a conclusion on the ways and means to save and invest my money. I would suggest the same to all who feel that it is futile to satisfy urges, strong or mild, to spend carelessly now and repent later.

New Years is a time for celebration as we turn time over into a new year full of promise. This will be no different as turn into 2011. Well, with one big exemption. Tax rates are going to be rising. You need to know about the big ones and plan for them.

In some ways, the federal government is like a business. It takes in revenues and pays expenditures. Unlike a business, the government is able to expend far more than it taxes in and do so for years so long as its lenders, known as bond holders, don’t lose faith in its ability to make payments on the debt it incurs. Well, 2010 is the first year our debt has surpassed $13 trillion dollars. On top of this, our national debt is now at GDP percentage that make it the highest since World War II. Thank you Great Recession!

Unsurprisingly, 2011 is also the year we see a burst of higher tax rates and new taxes. Part of it is the efforts of the Obama Administration to pay for healthcare costs and part of it is the “Bush tax cuts” expiring. Combined, the 2011 tax year is going to be a dozy for most taxpayers, one you need to plan for.

So, what increases should you know about? Well, how about the capital gains tax? The rate will increase from 15 percent to 20 percent. The top income tier will go from 35 percent to 39.6 percent. The top dividend tax rate will pop from the current 15 percent to 39.6 percent. In a real crusher, the estate tax will go from the 2010 rate of zero percent to a whopping 55 percent. To top it all off, the Alternative Minimum Tax will bite into more middle class families.

What can you do about this mess of increases? Well, plan ahead. Take capital gains in 2010 instead. Reconsider whether the dividend producing investments make sense under the new tax reality. Talk to a lawyer or accountant about planning to avoid the estate tax so that your family can actually reap something from your life’s work. In short, start considering changes now before it is too late.