Consider the Home Office Deduction

Work From Home? Consider the Home Office Deduction

Tax Tip 2011-53, March 16, 2011, Courtesy of www.irs.gov.

Whether you are self-employed or an employee, if you use a portion of your home for business, you may be able to take a home office deduction. Here are six things the IRS wants you to know about the Home Office deduction

1. Generally, in order to claim a business deduction for your home, you must use part of your home exclusively and regularly:

as your principal place of business, or

as a place to meet or deal with patients, clients or customers in the normal course of your business, or

in any connection with your trade or business where the business portion of your home is a separate structure not attached to your home.
2. For certain storage use, rental use, or daycare-facility use, you are required to use the property regularly but not exclusively.

3. Generally, the amount you can deduct depends on the percentage of your home used for business. Your deduction for certain expenses will be limited if your gross income from your business is less than your total business expenses.

4. There are special rules for qualified daycare providers and for persons storing business inventory or product samples.

5. If you are self-employed, use Form 8829, Expenses for Business Use of Your Home to figure your home office deduction and report those deductions on line 30 of Form 1040 Schedule C, Profit or Loss From Business.

6. If you are an employee, additional rules apply for claiming the home office deduction. For example, the regular and exclusive business use must be for the convenience of your employer.

For more information see IRS Publication 587, Business Use of Your Home, available at http://www.IRS.gov or by calling 800-TAX-FORM (800-829-3676).

Helpful Links:
Publication 587, Business Use of Your Home (PDF 214K)
Form 8829, Expenses for Business Use of Your Home (PDF 64K)

For additional tax tools, vist www.TaxDivas.com.

11 Ways to Make Life less Taxing with the TaxDiva:

1. Taxes prepared by someone knowledgeable that you know and trust with over 20 years of tax experience (Former IRS Auditor).

2. Free Electronic Filing so you get your money fast at no additional cost.

3. Free prior year tax return review.

4. Free Tax Organizer & Deduction Finder.

5. Access to resources to help you Plan, Plant, and Prosper.

6. Year round availability for tax planning.

7. Client referral program (refer a paid customer and get rewarded).

8. Family discounts.

9. 50% off Maryland Personal Property tax and Home Owner tax credit returns.

10. Attend the Annual Winter Income Tax Open House on February 12th, from 12-1:30 pm, register at www.openhouse2011.eventbrite.com.

11. Visit www.TaxDivas.com for money saving resources and a copy of the Strategic Simple Tax Organizer or call (443) 994-3084 to schedule your tax appointment.

Get Your MBS! What are you waiting for?

The government cannot save you! With unemployment at 9.8%, neither will a job. Save yourself and your business with the 60 Day MBS (Maryland Business Stimulus) Challenge.The challenge consists of tasks selected to help level the business playing field. Competition is alive so you need to play with the correct people, places, and tools. The tasks are organized to take about 60-minutes per day.

• Tasks such as register for eMarylandmarketplace, a free program that sends RFPs to your inbox.

• Another task, intended to help you focus, includes organizing your office for efficiency. A cluttered office is the path to a cluttered mind.

• Helping you do more with less time, another task rewards you 15 points for outsourcing a task. Try it; you’ll be glad you did.

• Another task is to become a Maryland Green Registry Member. A program that helps the environment while giving your business free online exposure.
Embracing technology is a no-brainer so many of the tasks will get you up and running electronically.

The challenge ends on March 12th so start checking things off your list, today. You will earn rewards (points) as you complete the task, not to mention the exposure and support that you will receive.

Each month an optional check-in session is scheduled to share tools, tips, and challenges. Do not delay, grow your business today.

Register now at www.60day.eventbrite.com then check-in at www.facebook.com/60daymbs and make some new friends.

The Time is NOW to Get Your MBS! Maryland Business Stimulus

The 60 Day MBS Business Challenge was created to help small business owners and entrepreneurs level the business playing field. It is an efficient way to help you develop your business while managing your already busy schedule. If you can invest at least one hour each day from December 10th until February 15th, 2011, you can get a lot done. Double up some duties and you can stay on schedule if your are joining after the 10th. Register for the business challenge at www.60day.eventbrite.com through December 31 at no cost (you will also be sent a worksheet for keeping track of your points/rewards). Get your MBS! Check out the www.facebook.com/60daymbs for helpful discussions and comments.

Complete the following tasks:

60 Day MBS (Maryland Business Stimulus)

1. Join 60 Day MBS Fan Page (www.facebook.com/60dayMBS)
2. Organize workspace for efficiency
3. Complete a 2011 Simplified Strategic Business Plan (only 9 pages, includes income projections and marketing budget)**
4. Meet with a commercial banker, DBED, or business assistance center
5. Get strategic partner, mentor, or form/join a mastermind group
6. Outsource a task/service or read a book*
7. Update Website or Blog with 2 testimonials, 1 case study, or 2 value statements
8. Add 60 people to your permission based “list”
9. Identify 4 Accounts Achievable
10. Create an identity theft policy or a customer satisfaction policy
11. List your organization on 8 online sites
12. Make 4 posts to your Blog and/or Facebook Business Page
13. Send 2 Constant Contact Email Campaigns
14. Submit Maryland M/WBE Certification paperwork or prepare/organize your 2011 tax season records **
15. Complete Baltimore City Certification or join 4 local bid lists
16. Create a YouTube Video/Podcast/Webinar *
17. Register for the eMaryland Marketplace and Small Business Reserve Programs
18. Create a capability statement or tip sheet
19. Become a Maryland Green Registry Member
20. Identify 4 ways to save money/cut costs
21. Adopt or support a charity or cause
22. Attend or sponsor 2 business events
23. Accept credit cards or gift certificates
24. Identify an alternative payment method

Reward system: Each item is worth up to 5points except for the following: * = up to 15 and ** = up to 25. Possible rewards (points) 24 items = 200 points
You are rewarded at 150+.

Are you up for the challenge? Are you committed to a successful 2011?

Get Your MBS! Maryland Business Stimulus

Check out www.facebook.com/60daymbs.

Sign up at www.60daymbs.eventbrite.com.

Nephew - Business Closed!

Do you believe that if you build it, they (customers) will come?

Summer Time - And the Living is easy....

Take the goal poll: http://tinyurl.com/goalpoll
Thanks

Recently, I called my nephew (he is 13 and 10 months old) to find out his plans for the summer. He told me that he wanted to work but that he had to be 14 to get a job. I suggested that he starts his own business. He calculated that he needed $971.00 to pay for a year of services for the new iPhone 4 (I think that he left the data plan out, anyway..). Well, I tell you that like many others, I heard the excitement in his voice as we started planning his business. No, I did not charge him because he would not have paid me...the boy is tight with his dollars.

After putting together a nice menu of services with low prices, coming up with a catchy name, and getting a business email address; he is now waiting for clients. I hope this does not sound like you. You have/had a great idea or a great business and nobody knows. If you need help growing your business, take a look at http://tinyurl.com/summer-tools to find more than 100 ways to grow your business or schedule your appointment at www.summerbiz.eventbrite.com. Let me know what you are doing to grow your business. Did you notice that my clientless nephew has a goal that is driving him (his iPhone 4. I think that with a goal, the right attitude, and some knowledge, he will be okay. What goal is currently driving you?

Well, is the living easy? Perhaps! Check out http://tinyurl.com/financialfun-ds for a little fun. Let me know if you found this easy.

Sugar Honey Iced Tea on Resolutions!

Let's set SMART goals to make 2010 our best year. Making Resolutions each year often means that it is okay to forget them so forget about it this year! This year, set effective goals and make them Specific, Measurable, Attainable, Realistic, and Timely. Your goals need to be relevant to your journey in life as well as those who depend on you. Sometimes our goals are about adopting new improved habits and changing our thoughts and our talk - I can't leave out changing our walk or where we walk.

I recently spoke with a guy who was laid off for 11 months. Why do we call it laid off? He was starting a business but was stuck in laid-off mentality, still searching for a job but sometimes saying that he was starting a business. How would you feel if your car was stuck in start-up? You sure would not get far.

Thanks for visiting. I wish you a fantastic year. I would like to share a short term as well as a long term goal with you.

Short Term - I will provide training for Tax Preparers who currently have no certifications or licenses by December 10, 2010 because I am so glad that the IRS and State of Maryland are currently making an effort to regulate income tax professionals. I am already licensed by the Department of Treasury as a workshop sponsor.

Long Term (more than one year) - I will publish my second book by January 15, 2011.

I have now put the above goals out there so a lot of steps go with them. What are your goals for 2010? Be honest about what you want and what you can and will do. Also I invite you to join me on January 16th to set and share your 2010 goals at my annual open house. Please register at www.TaxDivashouse.eventbrite.com.