Legitimate Home Based Businesses

Posts Tagged ‘tax’

Question: What kind of tax write offs can i do if i started a Home Based Business ?

Im looking to start a small Home Based Business. I am a single mother with two small girls. I lost my job as a semi truck driver in the oilfield in may, and would like to start something i can do at home, so i can stay with my children.

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A Home Based Business and Tax Deductions

Question: What are the drawbacks to a home office tax deduction?

My wife runs a business out of our home and has a legitimate home office that qualifies for deduction. I've been told that there are some drawbacks to doings so. I know that it's an audit flag. Not too worried there. But I've also been told that it can cost us more when we sell the house. Is there truth to that? Can you explain it in layman's terms? Is it worth claiming? THANKS!
Thanks for the answers so far. So is it worth it to take this deduction? Am I going to lose everything I saved when I sell?

Answer: If this is rented home, then no problem.
If you own the home, then for the home office you must take depreciation. When you sell the home, this depreciation is treated as income.

Tax Deduction Tips & Advice : How to Claim a Gas Mileage Deduction for a Small Business

Question: What is the best business structure for a Home Based Business in New York state?

My wife wants to start a Home Based Business selling party favors on the internet and through mail-order but she does not know what business structure would be best. Should she be a sole proprietor? or should I become a partner with her to make a partnership (since i'm sure i'll end up gluing or wrapping something)? or is there another choice? What are the tax benefits for each choice? There will be no paid employees but herself. She will be located in New York City. I work full time at my own job. We currently file taxes jointly.

Answer: I amm in NYS - started a business a few years back. It should be sole proprietorship. She can register for a tax ID # but doesn't have to. Register the business name and use her social security number. The state and feds don't mind a loss shown in April for the first year or two, but after that it must show a profit or else they will consider it a hobby and not allow for the deductions. This is direct from my accountant. Keep it simple, advertise in local publications - Pennysaver is a good place as they usually post all ads on their web site as well. Branch out into Westchester - lots of opportunity there as well.

Acetone works great to remove glue!! Have fun and good luck!

Benefits of a Home Base Business - Bottling Home Made Wine in Italy