Legitimate Home Based Businesses

Archive for October, 2009

Question: what do i need to do to start a home based small business?

how do i obtain a small business licence and what else do i have to do for example a automotive dent removal business where i live is zoned for business or resident

Answer: I started mine and now making good money. Go to homedatajobs.com they helped me alot. Great tools and easy

Home Based Business Tips

Question: Tax deductions for new part time Home Based Business. Purchased Equipment last year. How do I calculate?

I have a small part time photography business. Last year I had $10,000 deposited into a business account to start my own business. I purchased some very expensive equipment. during 2006. However I did no paid work. On last years return I stated no income and no deductions for my sole proprietor portion of the return. This year things seem a little more favorable. I actually have a booking for a job and my business is now fully liscensed. How do i factor in my expensive purchases from a prior year? Any advice will be appreciated. Thank you
Sorry i meant i filed no deductions/income for the year 2005

Answer: You would capitalize your equipment and depreciate it over its useful life. Use its fair market value for depreciation purposes. Lets assume you bought equipment for $10,000 in 2006 used exclusively for business. The equipment has a useful life of 7 years. If you use an accelerated method of depreciation, you would write off the equipment over the next 7 years as follows:
2006 - $2,449 (24.49%)
2007 - $1,749 (17.49%)
2008 - $1,249 (12.49%)
2009 - $893 (8.93%)
2010 - $892 (8.92%)
2011 - $893 (8.93%)
2012 - $446 (4.46%)

If you had income in 2006, you would be able to elect Sec. 179 and expense the equipment in the same year. So if you had $15,000 net income in 2006, you would have been able to write-off the equipment of $10,000 and be left with a net income of $5,000.

Note that if you only used the equipment for 75% business use, you would only depreciate 75% of the cost of the equipment, or $7,500.

Home Business Tax Deductions (Home Office Deductions)

Question: Business permit/license?

Anyone know how much you have to make before you need a business license or permit in GA? Also how much are the permits/licenses? It's a Home Based Business.

Answer: You need a business license if you are in business. http://homebizseo.com/50states/Georgia.html

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