Tips Guides

Starting your own business can be a very rewarding experience. You will enjoy freedom and flexibility you never imagined. You will also work harder than you ever have before but it feels completely different when you are working for yourself. Here are some tips to help you get off on the right foot with your record keeping.

1. Keep Receipts For All Transactions From The First Day Onword. If you pay for everything with a check, debit card, or credit card this may not seem necessary. As a tax accountant I can assure you that it is. The IRS will disallow deductions if you do not have receipts to accompany your bank and credit card records.

2. Avoid Cash. I can tell you the easiest way to get into hot water with the IRS is to pay for things with cash and then not have a receipt. For many of us we are in a habit of using cash from the time we were kids. For your own business though, you need to avoid cash.

3. Deposit All Your Income. It is very tempting to withhold cash from your business receipts but I advise you do not. Instead be aggressive with your expenses. If you are in an industry where cash deals are common the IRS will look for evidence of cash deposits in your checking account. If they are absent you will have a lot of questions to answer.

4. Use QuickBooks. Inuit owns 80% of the small business accounting software market and for good reason. Their software is easy to learn and easy to use. Within a few hours after installing you can be producing your own professional financial statements. It is the software I use for my own accounting/tax business and also what I use to produce client Financial Statements and Payroll Reports.

5. Report Employee Earnings Timely. There are several services on the market that will be glad to do your Payroll Reports and process your employee checks. Shop around and get the best deal. This market has become more competitive which means there are some good deals out there for you. For example, if you are in a high risk industry you can get a reduced WCF rate with a company like ADP. With the amount you save in disability insurance for your employees your Payroll Tax preparation expense is essentially free.

6. Use A Business Credit Card. Using a business credit card has many benefits. You can usually find one with no annual fee, 0% introductory interest rate and even cash rewards. But for the purpose of this article one of the primary benefits is for your record keeping. At the end of the year you will receive a summary of all your expenses by category. Give this to your accountant along with your other records at tax time. This will make your accountant’s job easier which should lower his/her fees.

There are many other items to consider when starting your own business and I recommend you speak to an accountant as soon as possible. If you already have someone preparing your tax returns then you can start with them. Make sure they are familiar with hiring your spouse and children, medical reimbursement plans, business plans and entity structuring. Do not stay with an accountant who is not familiar with these because you cannot afford to.

Zach Allred is a tax accountant with a desire to provide tips about good credit card practices. You can visit his site to compare business credit cards. You can also visit his home based business site for other resources and free articles.

For 18 years I have been preparing income tax returns for individuals. Unfortunately even as a tax preparer I miss deductions on my client’s tax returns but for those who prepare their own returns I am certain these 10 tax deductible items are almost always overlooked.

1. Miles driven for medical related incidences are deductible as an itemized deduction. The rate is $.20 for 2007 and $.19 for 2008. Miles are totaled for doctor visits and hospital visits. Start adding them up and you will be amazed. Think about it on a weekly or monthly basis and then multiply by 52 or 12 respectively.

2. Interest paid on a 2nd mortgage is deductible as long as the residence has a function kitchen and bathroom. Have you ever considered your motor home in this hidden tax deductible item?

3. Charitable donations are often overlooked since we do this out of the kindness of our hearts. But when it comes tax time sit down and figure these up. Include donations to Deseret Industries and vehicles donated to different foundations.

4. Moving expenses incurred for a job related move are a tax deductible item. There are certain tests to qualify for this deduction so be sure to consult your tax advisor. Deductions include transportation and storage of household goods. Travel including lodging from your old home to your new home is deductible.

5. Deducting alimony can provide an annual tax reduction of $3,360 per year assuming $1,000 paid per month and you are in a 28% tax bracket. Do not pass this one up as the alimony is also taxable to your ex.

6. Student loan interest paid on loans for education is deductible. People often miss this one because a lot of changes take place after graduation and this deduction gets over looked. With rising education costs the student loan interest really adds up.

7. Taxes withheld from your paycheck that have been sent on to your state on your behalf by your employer are deductible. Also if you owed your state for taxes from the year before that you paid during the current tax year do not forget this tax deductible item.

8. Loans made to family and friends who have failed to repay you are deductible as worthless debts on Schedule D. You are limited to $3,000 per year until the full loss is taken. But if you have capital gains then the whole loss can be taken up to the amount of the capital gain plus $3,000.

9. If you are self employed there are countless deductions but for the purpose of this article do not be afraid to take a loss on line 12 of your 1040 resulting from your Schedule C. If I did not make any income from my self employed venture can I take a loss? Yes absolutely.

10. When a family member moves into another home you own often you will forget to report it. The incentive to reporting is that this is a tax deductible item. You can usually create a loss to be reported on your 1040 when these deductions are properly accounted for.

You can go to Zach Allred’s web site for more free articles relating to tax deductible items. You can also visit forhome based business ideas.

Many debt collection agencies are avaliable today, but only a few stand out from the crowd. We examine the standards that you should be loking for when making a choice.

So, Why Use A Debt Collection Agency

When deciding upon using the services provided by a debt collection agency, the details can seem daunting at first. People use these agencies for a number of reasons so it is important to seek the advice and service of one that best suits your needs. Debt collection agencies can typically offer more help than what one might initially think.
One of the most common questions when choosing between debt collection agencies is in regards to cost.

The Costs Involved

An agency should offer more than one option for payment to offer a more customized plan for you. Choosing the right option for your needs will help ensure better use of your debt collection agencies services.
A debt collection agency may offer a flat rate plan. These plans offer services for a set fee to keep your costs fixed. Within this plan, even more customization may be available, depending on how often the services of the debt collection agency are required. You may be able to choose between monthly plans or even on an as needed basis.

No Win No Fee

One common payment plan that many debt collection agencies use is to collect debts with no fee. The purpose of this plan is to offer a low cost alternative to other plans. If debts are not collected, typically no payment is required. If the debt collection agency does collect debts, they will then withhold their commission rate, which varies among companies and the amount of debt that has been collected.

Can The Debt Collection Agency Measure Up

It is important to determine if your debt collection agency can be customized for your needs, depending on the type of business you have and the amount and type of debt that you need to be collected. For example, landlords of both residential and commercial properties can seek the service of debt collection agencies to pursue overdue and unpaid rent. While it is common for landlords to be owed rent, it is important to be sure that your debt collection agency fully understands the details for completing the necessary paperwork and how to successfully collect the debt owned to you in a timely manner.

I Have A Judgement But No Money

Perhaps you are owed a debt so you have filed a judgment in an attempt to claim the money owed to you. In order to be enforced, the services of a debt collection agency that is experienced in this field may be required. A judgment does not actually collect your money therefore it is important to find a debt collection agency that understands how judgments work in order to get results.

Choosing Your Agency

A debt collection agency should be able to offer you a variety of choices when it comes to payment as well as customized plans to better suit the needs of your business. When it comes to collecting your debt, you will want results, and you will want them in a timely manner. It is imperative to choose a debt collection agency that can provide all of these services while still being the best value.

The choice of the right debt collection agency can be crucial to the recovery of your money, so make the best choice for you. A no win no fee service is always advisable for the best results.

James Johnson,trawling the net for a decent debt collection service. Online debt collection is likely to be the future of debt collecting. Debt collection services and agencies. Desigh by DNETS

Everyone needs to sort out a pension at some point in their life and the sooner you look into the process the easier it is to deal with. One of the first things that confuses people looking into pensions is the different types on offer.

In this article we will explain the four main types which will hopefully help you feel more informed about which option is most suitable for your circumstances.

State Retirement Pension - this is the pension provided by the government, for some people the level of money provided by this pension may not be enough to live off, however almost everyone is eligible for the scheme.

You can begin to claim the pension at the age of 60 if you’re a woman or at the age of 65 if you’re man.

The amount of money you received is based upon you National Insurance contributions, if you’ve been out of work for significant periods of time or under the NI threshold you might need to seek further advice on your entitlement.

Occupational Pension - in the past this was the most common pension people would have in addition to their state pension though with Stakeholder schemes they are becoming far less common.

The pension scheme is set up by your employer for all members of staff who want to become part of the pension. However due to the changing work climate where people move companies more frequently occupational schemes are proving less common.

There are two types of occupational pensions schemes, the first is known as ‘Final Salary’ with this type the amount you receive from your pension is calculated from the earnings you were making prior to retirement. This is particularly appealing if you’ve been promoted over a series of years to a senior position towards the end of your career.

The other option is known as ‘Money Purchase’ here your payments are based on the amount of money you actually contributed to the pension. I.e. if when you started the scheme you only made small contributions you won’t receive as larger a payment when you claim the pension.

Personal Pension - some times people will want their pension scheme entirely separate from their employer, this is where personal pensions come in. They are completely independent from your work place and are organised through commercial organisations like banks and insurance companies.

However with personal schemes as the obligation to pay falls entirely with you if you pay in little or not very often it will have a significant impact on the amount you receive. Also their may be penalties for changing the amount you would like to pay in, if for example if you begin working for an employer who has an occupational scheme that may incur a charge.

Stakeholder Pension - increasingly becoming the most popular kind of pension is the stakeholder variety. It falls somewhere between the occupation scheme and personal types. It can be organised by employers, unions or other organisations like the Post Office. The advantage of this type of pension is it’s a lot more flexible than personal pensions and has less charges and penalties than other types.

The Pensions Regulator offer information and advice for trustees and employers dealing. http://www.thepensionsregulator.gov.uk

Fractual or fractional ownership is the hottest new approach to buying luxury items that an individual would not otherwise be able to afford.

Fractual (fractionally actual) ownership allows a group of individuals to purchase a percentage of real estate, luxury car, resort, vineyard, restaurant, jet, yacht, artwork, or even a fine Rolex. Fractual owners or investors reap all the benefits of ownership, but their investment expense is also smaller so they can afford a larger home, yacht, or several watches.

How Fractual Purchases Work

Luxury homes, condos, and exotic vacation homes are the most popular items for fractual ownership. Typically, the title or deed is divided into shares and those shares are then purchased by a group of investors, usually numbering between four and twelve, sometimes as many as fifteen. A management company is often employed to maintain the property and manage the investment. In some arrangements, the owners actually hold shares of a mezzanine structure or company that in turn owns the assets.

Most fractual properties are set up with an ownership agreement or contract that includes some fees to cover the cost of managing the property, details for usage for each owner, and various other guidelines for renting out one’s share or selling it as well as do’s and don’ts for the property. Some groups are formed among friends or family members working with a lawyer to set up the contract. Others are strangers working through a fractual development company or broker. Either way, a sound, clear and concise agreement is key to ensuring a carefree and hassle free investment. And similar agreements can be created and put into place for fractual purchases other than real estate.

Advantages to Fractual Ownership

Although it may sound like a new name for timeshares, fractual ownership is not the same as a timeshare. In a timeshare situation, the purchaser only owns “units of time,” not the property. Additionally, much of the cost of a timeshare, up to 50%, pays sales commissions. Because timeshare ownership is not linked to the property combined with the fact that they have faired poorly in the secondary market, the value of most timeshares have experienced a marked depreciation of their value.

Fractual ownership of a property entitles owners to usage rights but since they own a fraction of the title and deed, their investment increases in value as the property appreciates. Fractual owners are also eligible for any tax advantages associated with owning the asset. Banks and mortgage companies often treat fractual purchases as second-home purchases making it easier to finance them. Lastly, fractual shares in a property or assets can be transferred or sold fairly easily.

Fractual ownership is growing in popularity for other high-end items including jets, yachts, real estate and jewelry. Many of these opportunities are found with companies online. The Internet has opened up markets worldwide for buying and selling everything from abstract art to collectible figurines to fine jewelry to ski lodges in the Alps or a condominium in Madrid. With the practice of fractual ownership, these investments are becoming available to more people with some degree of a disposable income.

www.HighEndCrazy.com is the ultimate free online auction site. The site features free online auctions and classifieds, and makes it easy to set up your own store.

Any company, big or small needs to manage its cash flow well, just as much as its sales and expenditure. There are many giants that were seemingly doing very well with steeply rising sales and running massive projects, spending lavishly on research and development backed with advertising campaigns, only to see them crash almost overnight. What is the reason for such unexpected crashes? Since we are told that their sales were doing well and expanding, then the root cause has to be poor cash flow management. Cash flow is the difference between your receipts and payments (in cash, whether from bank accounts or from other source). Cash Flow should not be confused with income and expenditure or profit and loss that is quite different from receipts and payments.

To illustrate the difference between income and expenditure (profits) and receipts and payments (cash flow), let’s take a simple working example. A small company gets a contact for $ 1,000,000/- and they calculate their cost of production at only $ 225,000/-.

The company is highly bucked at the prospect of making an almost 350% profit on their new contract. With much fanfare, jubilation and congratulations all round, contracts are signed; product is manufactured and delivered to the customer in January. Being a small company operating within a modest budget, it had to borrow from banks at high interest rates for procurement of raw materials etc for this operation.

Customer is paying only in July, which is six months hence. The small company in its eagerness to grab the deal at all costs, had invested all its resources on this special project, and with monthly high interest payments now due to the lending institutions for the next six months until they get their payment from the super contractor to pay off the banks, and being unable to get any further loans, gradually finds itself unable to meet its normal monthly commitments on rents, rates, salaries and wages etc. or keep the production lines rolling for the manufacture of their normal products and already agreed supplies to other customers, even in more their smaller quantities. So the company inevitably crashes, why? Simply because they did not bother to see how their cash flow would work out during the interim period between spending and receiving money; by only concentrating on making a massive $ 775,00/- gross profit on a single contract!

It would be seen that “over investment” beyond their means led to the above crash. If it had been a bigger company with more assets and resources, it could have got away with it by drawing on their excess resources during the period they had to wait for settlement by the contractor. Thus, it is seen that smaller companies are more vulnerable to cash flow problems than their bigger counterparts. The following tips should be useful to avoid similar disasters by managing your cash flow well.

Fast Debt Recovery

You should have a very good control over extending credit to customers in terms of time as well as a maximum limit while always trying to collect your debts as fast as possible so that you could enjoy the benefits of having more working capital. Getting your customers to place their orders online or by fax could help speed up the process of collection. Ensure that you dispatch the invoices along with the goods and that the due dates of payments and the penal rates of interest applicable in case of delayed payments are clearly stated therein.

Formulating a firm Policy of Extension of Credit Facilities and Collection

Each customer should be granted credit facilities on his own merits of proven creditworthiness, possibly in consultation with rating agencies; or by requesting the customer to furnish references. Follow up all late payments immediately with a phone call or a letter or both, failing which legal action may be contemplated for recovery of the debts. Curtail further supplies to a debtor whose account has fallen overdue, until all overdue balances are settled.

Go along with minimal balances in your operating bank accounts

Having a good cash flow position does not mean carrying excess or surplus funds in your operating bank accounts. Instead, judiciously divert some excess funds for re-payment of any loans taken at high interest rates and simultaneously invest in high interest yielding fixed securities or in short call deposits depending on your liquidity position, that is, your ready cash availability from bank accounts, deposits at short notice, good debts recoverable etc. taken together with the estimated cash inflows and outflows for the next two to three months.

The pulse of any business is its cash flow. Therefore strive to maintain it at optimal requirement levels at all times, no more and no less.

Caleb Anderson invites you to visit Find This Online an online resource guide that offers a variety of articles written on different subjects. Visit us at Here for more articles on accounting.