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JeanMarie HindsOctober 29, 2009
Getting Started Start-Up Costs Hiring Employees Business Use of Home Use of personal vehicle & Travel expenses Estimated Tax Planning Retirement Plan and other benefits Additional Tips
Business Structure Employer Identification Number (EIN) Banking Keeping the records & accounting Equipment versus Supplies
A cost you could deduct if you were already operating an active business; and
A cost you incur before the day your active business begins.
Will be amortized over 180 months* May elect to deduct up to $5,000 in the first year
of business May be able to recover any remaining costs upon
disposition of the business
Analysis or survey of potential markets, products, labor supply, transportation, etc.
Advertisements for the opening Wages for employees being trained and their
instructors Travel and other necessary costs for securing
distributors, suppliers, or customers Consulting or executive fees for professional
services If purchasing a business, only the costs for a
general search or preliminary investigation
Employee or contractor? Set up accounts with the state WDOR for withholding DWD for unemployment Workers compensation coverage Employee Benefits
1. Your use of the business part of your home must be:
Exclusive Regular For your trade or
business, AND
2. The business part of your home must be:
Principal place of business, OR
Where you meet with customers in the course of your business, OR
A separate structure
Indirect Expenses:
Utilities Real estate taxes Property Insurance Depreciation
Direct Expenses:
Furnishings Repairs to office Improvements to
office Depreciation
Actual Expenses: Fuel License Repairs & maintenance Depreciation Insurance Plus Parking & Tolls
Standard Mileage Rate:
For 2009, 55 cents per mile
Plus Parking & Tolls
Based on projection of income for the year “Self-employment tax” is like FICA for
employees and it is due on net profit Add to income tax to get projected tax liability Law says 90% of estimated or 100% of prior
year amount must be paid in by year end. Dates are April 15, June 15, Sept. 14 and Jan.
15 Underpayment Penalty will be assessed Both federal and state estimated tax
Depends on the biz structure If sole-proprietor, start with IRA Health Savings Accounts Medical insurance Life insurance Disability insurance
Time is money: Add up your own receipts Do not assume that tax documents you receive
are correct, check them! (W-2s and 1099’s) Bring along ALL business expense and income
records Get tax planning advice from a tax professional
BEFORE the year ends Consult with your tax preparer BEFORE
responding to any tax penalty notices