Easy Tips for Smooth Taxation for Home Based Business Owners

Are you running a business from your home are looking for how to work on business tax return? Are you excited to start crossing off your resolutions? Then this is the right place where you can get the best solution for all of your queries. It is essential to know the kind of tax return you are going to file based on your business. Taxpayers who run their business from home or outside their home must be aware of the tax return to claim the rights. Getting tax return is far easy when you are following the basic structure to get the tax return on time.

There is a very little difference between the home-based and the business located outside the home. And that is the deduction of the cost from the calculated space provided in your business. Every company needs to have a space for running it including online store as well. Space required for it is a legitimate business expense which you can deduce from the business tax return.

A small entrepreneur needs to file his tax deduction from home on Form 8829. In this article, we have provided detailed information and some important tips for smooth taxation for your home-based business, which are as follow:

1. Fill the Form 8829 Carefully

It is one of the simplified options which you need to fill nicely. While loading it, you need to calculate all of your legitimate business expenses. In addition to the number of different charges that are often being made for the business purposes, you must know the calculation for the total amount of space used from your home, internet bill, office room decorations and much more. If you aren’t aware of such calculations, you should consult a professional who can guide you properly.

2. Deduct Various Home Utilities Very Carefully

If you are running your business from home, you are allowed to deduct the portion of your utility bills such as your electricity bill, internet bill, phone bill etc. Other home utility charges you can add are mortgage interest, home insurance, sewer, trash etc.

You can also add the charges for the space which you are using as your office space. You can get the charges per square feet of your home office.

3. Deduce Stationary Costs from Your Tax

Being a home-based entrepreneur you also have some expenses as done by office entrepreneurs such as stationary. You can’t forget to add the costs made on paper, ink toner, postage, paper clips and various other expenses to your tax deduction. If you are using a new computer or iPad, you can deduce their charges as well from the payments.

4. Introduce All of the Payments That Is Needed to Upgrade Your Home Office

Home-based business owners are also free to add charges spend on a new desk, office chair, bookcase, desk lamps and other furniture as well. It means that you can use these charges as the expenditure for setting up your home business and hence also use in tax deduction.

5. Deduce All the Charges Spent on Business Trips Travels

If you are supposed to pay some amount on transportation to meet your clients, you can add them to your list of the tax deduction. You can add charges such as flight booking, train reservation, bus reservation, parking charges, and tools to this list.

6. Deduce the Charges of Lunches with the Clients

Being a home-based entrepreneur if you are going for a lunch meeting, you can add these charges to your business expenses. Just add money spend on local coffee houses, public transport you used to meet the clients and any other such spending to the list.

7. Deduce Health Insurance

Health insurance is one of the most critical factors whose value you can deduce from the principal tax payments. You are free to infer the cost of health insurance for the business holder and their family as well. You can also choose the employer-subsidized plan for your tax deduction.

8. Use Tax-Deferring Retirement Plan

Most of us always look forward to the tax deferring retirement plans which can save a lot of our hard-earned money. Various taxpayers who have a tight cash flow are very eager to know about the multiple methods for a tax deduction. If you are among them, then tax deferring retirement plan is one of the best options to go along. It is the best way to lower your taxes. Just choose a method as per your convenience and lower down the amount of taxes you are paying down.

Wrapping-Up:

When comes to paying tax return, it’s always good to consult a tax specialist to know the complete details regarding your tax issues. It’s your responsibility and rights to claim the tax return benefits on time. So try to know all the legal statements which support on your way to reach the destination.

Tax Laws for a Home-Based Business

Your home-based business is in a unique tax situation. It’s important to realize that if you conduct your business from home, you can deduct all the same expenses other businesses can. Moreover, you can access further deductions that will mean lower taxes you pay on your business income. Add to that the deductions of a home office and you’re really looking to lower taxes. However, be aware that calculating these deductions can be slightly different.

Direct Business Expenses
Any expenses that are directly related to the running of your business are deductible regardless of where your business is located. This includes home-based businesses. This means office supplies, raw materials, product samples, entertainment, and meals can all be included in your deductions. Be sure to keep your receipts for business related expenses so you can back up your deduction claims. Your expenses should be reported on Schedule C of the 1040 return form.

If you find that you have more expenses than revenue, you are able to claim the net loss against other sources of income or carry it forward for future years.

Home Office Deductions
If your business is located in your home, you will be able to claim some expenses of your home operations as a business expense. The IRS allows a home office deduction if you meet one of the following two criteria:

  • The home office is your main place of business, or
  • You regularly and consistently receive clients there.

This means that if you do not rent or own office space somewhere else, your home office is your main place of business. To meet the second criterion, you can have an office outside your home, but you see clients often in your home office. An example would be a lawyer who regularly meets clients in his home office in the evenings.

Calculating a Home Office Deduction
To figure your home office deduction, calculate the percentage of your home devoted to your office. This can be done in two ways. In the first manner, divide the square footage of the home office by the total livable square footage of the house. The second manner is to divide the number of rooms taken up exclusively by the home office by the number of rooms in the house. Be sure to calculate both ways and then choose the one that gives you the biggest percentage. Then, apply this percentage to home expenses, such as mortgage interest, utilities, property taxes, repairs, and maintenance. Apply the percentage to home expenses on the Schedule C form and this becomes your deduction. If your home office expenses create a net business loss, there are rules about which ones can be deducted and which must be carried forward in the future.

Vehicle Expenses
If you drive your personal car for business, you are allowed to deduct a portion of vehicle expenses against your business income. This is similar to businesses which deduct vehicle expenses. However, having a home office means the calculations are different. With a home office, you can include driving to and from your home for business purposes in your mileage calculation. You can also include driving between your home and another office. To calculate the appropriate deductible vehicle expenses, you can choose one of two methods. You may either multiply the IRS mileage rate ($0.55 at the time of writing) by the total miles you drove throughout the year for business or accumulate all your actual car expenses and apply the percentage of business miles versus total miles driven during the year.

Turn Your Home into a Smart Home – the Best in Smart Home Technology for 2018

The artificial intelligence is becoming an everyday thing with the virtual assistants, voice-automated lights, and other smart home devices.Just before a year, this technology of controlling your home products through devices like your smartphone was in its babyhood. But recently, tech giants like Google and Amazon have taken this technology to another level by introducing the smart home devices.

Last year, we had the choices of Echo smart speaker by Amazon and Home by Google. But we can expect tons of new smart home devices like speakers from other electronics giants like Apple and Samsung.

Smart Home Devices – a Brief Introduction

Smart homedevices connect your house to the internet and your gadgets like your smartphone. Everything in your home like your thermostat, lights, doorbells, appliances, window curtains, TV, air-conditioner etc. will thensend information to you and take your command through voice or smartphone apps.

With this technology, you can control your house without being present in the house. You can set the temperature of your air-conditionerfrom your office, watch over your pet while grocery shopping by a remote camera, orswitch on your geyser while on your way back from office.

The smart home devices which are in high demand and are very popular these days are Echo speakers from Amazon and Home speaker from Google.

These smart speakersfromboth Amazon and Googleare available in cylindrical shapes which use power sources and internet connectivity to work.

You can not only make use of these speakers to listen to music by giving them voice command, but you can alsolisten to news, set alarms, and get audible answersto your any questions like you search something in a search engine. They can also be connected to a range of other smart home devices like some other speaker systems orsmart lights.

A Quick Guide to Use Amazon Echo and Google Home

Both the smart speaker systems are voice-controlled and can do manythings other than simply playing music for you. If you are using Amazon echo device, you just need to say ‘alexa’ to activate its voice assistance feature. And if you are using Google home device, then speaking the phrase ‘Okay, Google’ will activate the voice assistant feature of the device.

After waking up, amazon echo can take care of or respond to everything you say. All you have to do is to just say “Alexa, set an alarm for 10:00 AM”, or “Alexa, what’s today’s weather report?” or “Alexa, add brown bread to the grocery shopping list”, and the smart gadget will do accordingly.Similarly,in the case of Google home devices, you start a sentence following the phrase ‘Ok, Google’ and your assistant will be in place. For instance, say “Ok Google, what time is an available flight to London?” and your speaker will become your personal Google search engine.

Apple and Siri-Powered Smart Homes

Just like Alexa and Google, you can also convert your home into a smart home using iOS compatible devices and Siri. The upcoming HomePod speaker by Apple will be integrated with the service called Apple’s Homekit in the same way as Echo or Home.

Just like Alexa or Google, you can wake up the apple assistant by just saying “Hey Siri”. All the devices that are marked as “works with Apple HomeKit” can be used by the HomePod like Honeywell thermostats,the Philips Hue bulbs, and Lightwave plugs. HomePod is due to launch in early 2018 following a delay.

How to Set-Up Your Smart Home?

Both the speakers are compatible to set up with other smart home devices. They can be linked up to all your smart devices in the house from your smart thermostat to the multi-room audio systems.

For setting up a smart home, you need to consider that there is a huge range of different accessories that only work with certain products and work better with some than the others. Thus, the first step is to determine which assistant you want to have. After that, you need to determine which devices you have that are already compatible with your virtual assistant and which compatible devices you need to get.

There is a range of smart home products available in the market for both Google and Amazon.Amazon’s product range includes the main Echo speaker, Echo Plus (the larger version of Echo), the smaller version called Echo Dot and the Echo Show(its video-calling device). Similarly, Google offers the Google Home, Google Home Mini (the smaller version Google Home), and a Google Assistant on an Android smartphone. After you are clear on your choice about the smart home device, you need to have a rundown of the compatible products.

For every aspect of your home, the list of compatible and incompatible devices exists. For example, the range of smart lights by Philips, Philips Hue, can be operated by both Alexa and Google. Audio streaming devices like Google Chromecast can only use Google home while Sonos speakers respond only to Alexa currently.

The List of the Top Best Smart Home Devices of 2018

1. Amazon Alexa’s Echo, US $99.99

Amazon re-introduced Echo with new looks and slashed price from US$179.99 to $99.99. The new colors and fabricshelp it blend more easily into your home. The voice assistant Alexa uses thecloud to respond to music requests and answer questions.

You can enjoy many servicesby echo, which include playing music from Spotify, Amazon music, controlling Hive thermostats, booking a cab on Uber and getting a Domino’s delivery. Echo also allows its users to make calls and send messages. It can also read you articles and stories from over the internet. Alexa can follow a lot of voice activated commands and its abilities are being added every day. Alexa also has an Alexa app which can be used on your smartphone to manage the assistant.

However, it also has some restrictionssuch as, you can neither use Apple music with Echo and Alexa, nor you can connect Google’s Chromecast audio dongle with it.

2. Amazon Alexa Echo Dot,US $49.99

Echo Dot is a smaller model of Amazon Echo which is available online at around $50. There is no difference in the features between these two Amazon Alexa smart home speakers except the size.

So, Echo Dot can be a smart choice for those who are new to these voice-controlled smart home gadgets. However, if you are planning to buy Echo Dot over the regular Amazon Echo, then you must know that the regular Echo comes with a better sound quality than the Echo Dot.

3. Amazon AlexaEcho Show,US $299.99

Echo show is the newest gadget in the Echo series. It is not only a smart speaker powered by Alexa, but it also has video calling feature, which makes it the most advanced gadget in its Echo series.Echo Show has a 7-inch display screen on which you can enjoy video calling, online shopping, play videos and you can also use it as a baby monitor. You can watch videos on Amazon Video and now even on YouTube. Echo Show, while working as a smart home hub for other gadgets, can also show you news updates with videos and pictures on its screen.

Amazon is soon going to launch the mini version of Echo Dot, named Echo Spot. The date of release of this smart home gadget is not yet disclosed.

4. Google Home, US $119.00

In late 2016, Google launched Google Home as its own smart home hub to rival Amazon Echo. This device can answer any question in the world using the Google search engine such as train and flight details, restaurant recommendations, daily schedule reading and traffic updates. It can also link to other Home devices like the new Mini sets and the upcoming Max.

The main advantage of Google over Amazon is that it can integrate with Google Chromecast for streaming and also with the Android smartphones. With the help of Android smartphones, you can give voice commands to the Google assistant while on move.

You can voice activate the speakers linked to a Chromecast Audio for US $54.95 or attach the Google Chromecast streaming dongle to your set up and stream TV shows.

5. Google Home Mini, US $48

To rival with Echo Dot, Google came up with its own Home Mini which is priced at a similar range to Echo Dot and is perfect for the first-timers. It can perform all the functions performed by Home including controlling the speakers attached to Google Chromecast. It is small in size and is just 40mm high. It comes in a range of colors like coral, white and charcoal. Google is also about to launch a bigger version called the Google Home Max.

6. Chromecast Audio,US $54.95

Any speaker can be turned into a smart speaker by connecting it to the Google Chromecast via the headphone jack. This device can link any normal speaker to your smartphone or Google Home assistant. You can pair it with multiple other speakers or cast music from your phone by just using “Ok Google”. Chromecast Audio can also be paired with Chromecast video streamer to stream TV shows.

7. Sonos One, US $198.99

Sonos One is one of the best multi-room audio speakers that also connect to a smart home hub like Google’s and Amazon’s smart home speakers do. It is compatible with the Amazon Echo range and can respond to voice commands for playing songs. It can also play music from services like Spotify, TuneIn Radio and Amazon currently and is all set to add Google Assistant in its compatibility range in 2018.

8. Nest Learning Thermostat, US $233.97

The Nest Thermostat is a smart thermostat developed by Nest, a Google-owned heat control and thermostat company. Nest is compatible with both Amazon and Google but is yet not compatible with Siri. Its rival Hive thermostats can also be managed by both the smart assistants.

9. Philips Hue Smartlight, US $177.60

Smartlights from Philips have been around for a couple of years and are compatible with all Google, Amazon and Apple’s HomeKit. It can work with voice commands and also by the app. The Hue range can set up lights with 16 million colors and allows the users to have pre-set scenes for movies, gaming, dinner etc.

Wrap Up:

Both, Amazon Alexa and Google assistants can accomplish almost the same tasks but Amazon’s Echo comes at a slightly lower price. Moreover, it has a significant disadvantage of its incompatibility with Chromecast.Making the choice comes down to price range and personal choice. Apple fans can opt to wait for the HomePod before making the purchase.

For the new Smart home device users, both Google and Amazon provide pocket-friendly options with their Google Home Mini and Echo Dot devices, which you can buy under US $50 till date.

The Rise of Home Business in 2018

2017 has finally come to a close and all businesses are now preparing to start 2018 with a bang. With the markets going up and unemployment slowly going down, there are lots of positive things to expect this year. One of this is the rise of home businesses. In 2013, there are over 3 million home businesses registered in the UK alone. That is around 60% of all businesses in the United Kingdom. And while Britain’s homes are much alive with the sounds of business, the USA is also part of the growing home business owners.

The growth in the numbers of rising home businesses is increasing, raising over 1.1 million trades in the last 20 years. It has been reported that approximately 500,000 more home businesses existed in 2010. More and more business owners want to grow from home too, which is why the statistics are continuously rising even up until this year 2018.

According to recent polls conducted, over 40% of Americans now have some part of their jobs from the comfort of their own home. Both employees and employers get something from working remotely. And as technology continues to eat up this world, different collaboration software and chat programs are now making remote work more feasible for most white collar workers. Most employees love the flexibility and some researchers believed that unconventional work hours could actually help close the pay gap. Companies, on the other hand, permits remote work, as it will also help them able to cut down on their real estate costs and in order for them to retain and even attract employees.

Most people are now choosing to run their own home-based business. Here are some of the advantages of choosing home business as your smart choice for the source of income.

  • No Need to Commute. This is one of the most obvious reasons why lots of individuals choose home business: there is no commuting necessary. Imagine a day where you spent sitting in a car, a bus or at the subway while fighting your way to work. Home-based business owners don’t need to do all of that, for their commute is consists of just walking down a flight of stairs.
  • Lower overhead. If you are a home business owner, chances are you do not need to spend buying or renting business premises, thus, making your overhead lowers considerably. There will be no separate office to maintain or rent. This will help you save money on other miscellaneous such as utilities, licenses or taxes.
  • Advantages of income tax. Yes, you heard it right. When you run a home-based business, it will be a great way for you to recoup some of your business expenses. In some cases, you just need to reduce the income tax amount which you have to pay.
  • More quality time with the family. Operating a home business gives you more flexible time with your family, especially if you have children. When they grow up, you also might employ your sons or daughters in your business for it is completely legal to do so.

The rise of home business will continue not just this 2018 but also for the next years to come. If you’re planning on shifting from office-based to home-based, then this year might be the perfect year for you.

Bait and Switch Home Business Programs

Home business is becoming more and more popular nowadays. Along with its convenience of working from the comfort of your very own home, running your own home business has a number of rewards. Here are some of the popular home business ideas which might help you get started.

 

Freelancing – one of the easiest types of home business. Some of the skills which can be used in freelancing are writing, marketing, tax advisor, web design, and photography.

Virtual Assistant – VA provides a wide variety of virtual services for their clients. Among the services included are marketing, administrative and technical support from their home office.

Blogging – From fashion, travel, sports, health and more, blogging is also one of the easiest and most common types of working from home ideas. Blogging is a good way of gaining traffic to a website through the use of different social media sites.

Child day care – home childcare businesses offer long lasting and potentially lucrative business opportunity, especially for parents. You just first need to ensure that you comply with the state and local regulations when starting your own home childcare business.

Online Marketplace Store – selling products online is also the most popular way of home business. Once you have established your own network of consumers, you may consider starting your business on giant online stores such as Amazon, Etsy or eBay.

 

The DownSide

However, with all the convenience of being able to work at home, many try to lure people in running their own home business but came out as a fraud or scam. The term used is bait and switch.

Bait and switch is a form of marketing technique that advertises very attractive rate, price, term, item which is all meant to attract customers. When the person comes into this particular website, store or office and inquires about the advertised “bait”, the advertiser will then try to offer the person an even more expensive or different service or product which is actually the switch.

While bait and switch are most common to bigger industries with tangible retail items, home business programs are also no stranger to these bait and switch techniques. Let us take a look at some of the most common methods of this bait and switch so that you can make sure you are not unknowingly helping with this bait and switch scam.

Some of the common bait and switch marketing accidents

  • Using a competitor’s name in order to boost traffic to a particular product
  • Wording a particular campaign in ways that make it look and sound like you are selling something which you are actually not. Then using these tactics to trick consumers.
  • Using irrelevant keywords as parts of SEO bait and switch.

 

How to avoid getting lured into Bait and Switch or false advertisements?

First, one needs to research on the particular service, program or items being offered. Especially if a particular offer seems too good to be true. If a particular item or service is offered at a much lower rate, and similar items are more expensive, then it might also be a go signal to suspect that there is something wrong.

You can also file a report online against the accused company. All forms of bait and switch are considered illegal. And when proven true or more complaints are made against a particular website, then you can file a lawsuit against that particular website.

The best thing to do to avoid getting lured into these bait and switch techniques is educating one’s self. You need to be aware that many home businesses programs are now using unethical or illegal forms just to get their business operations. It is important to arm yourself with knowledge so that you won’t get lured into this so called bait and switch tactics.

Bait and Switch Home Business Programs

Home business is becoming more and more popular nowadays. Along with its convenience of working from the comfort of your very own home, running your own home business has a number of rewards. Here are some of the popular home business ideas which might help you get started.

 

Freelancing – one of the easiest types of home business. Some of the skills which can be used in freelancing are writing, marketing, tax advisor, web design, and photography.

Virtual Assistant – VA provides a wide variety of virtual services for their clients. Among the services included are marketing, administrative and technical support from their home office.

Blogging – From fashion, travel, sports, health and more, blogging is also one of the easiest and most common types of working from home ideas. Blogging is a good way of gaining traffic to a website through the use of different social media sites.

Child day care – home childcare businesses offer long lasting and potentially lucrative business opportunity, especially for parents. You just first need to ensure that you comply with the state and local regulations when starting your own home childcare business.

Online Marketplace Store – selling products online is also the most popular way of home business. Once you have established your own network of consumers, you may consider starting your business on giant online stores such as Amazon, Etsy or eBay.

 

The DownSide

However, with all the convenience of being able to work at home, many try to lure people in running their own home business but came out as a fraud or scam. The term used is bait and switch.

Bait and switch is a form of marketing technique that advertises very attractive rate, price, term, item which is all meant to attract customers. When the person comes into this particular website, store or office and inquires about the advertised “bait”, the advertiser will then try to offer the person an even more expensive or different service or product which is actually the switch.

While bait and switch are most common to bigger industries with tangible retail items, home business programs are also no stranger to these bait and switch techniques. Let us take a look at some of the most common methods of this bait and switch so that you can make sure you are not unknowingly helping with this bait and switch scam.

Some of the common bait and switch marketing accidents

  • Using a competitor’s name in order to boost traffic to a particular product
  • Wording a particular campaign in ways that make it look and sound like you are selling something which you are actually not. Then using these tactics to trick consumers.
  • Using irrelevant keywords as parts of SEO bait and switch.

 

How to avoid getting lured into Bait and Switch or false advertisements?

First, one needs to research on the particular service, program or items being offered. Especially if a particular offer seems too good to be true. If a particular item or service is offered at a much lower rate, and similar items are more expensive, then it might also be a go signal to suspect that there is something wrong.

You can also file a report online against the accused company. All forms of bait and switch are considered illegal. And when proven true or more complaints are made against a particular website, then you can file a lawsuit against that particular website.

The best thing to do to avoid getting lured into these bait and switch techniques is educating one’s self. You need to be aware that many home businesses programs are now using unethical or illegal forms just to get their business operations. It is important to arm yourself with knowledge so that you won’t get lured into this so called bait and switch tactics.

The Rise of Home Business in 2018

2017 has finally come to a close and all businesses are now preparing to start 2018 with a bang. With the markets going up and unemployment slowly going down, there are lots of positive things to expect this year. One of this is the rise of home businesses. In 2013, there are over 3 million home businesses registered in the UK alone. That is around 60% of all businesses in the United Kingdom. And while Britain’s homes are much alive with the sounds of business, the USA is also part of the growing home business owners.

The growth in the numbers of rising home businesses is increasing, raising over 1.1 million trades in the last 20 years. It has been reported that approximately 500,000 more home businesses existed in 2010. More and more business owners want to grow from home too, which is why the statistics are continuously rising even up until this year 2018.

According to recent polls conducted, over 40% of Americans now have some part of their jobs from the comfort of their own home. Both employees and employers get something from working remotely. And as technology continues to eat up this world, different collaboration software and chat programs are now making remote work more feasible for most white collar workers. Most employees love the flexibility and some researchers believed that unconventional work hours could actually help close the pay gap. Companies, on the other hand, permits remote work, as it will also help them able to cut down on their real estate costs and in order for them to retain and even attract employees.

 Most people are now choosing to run their own home-based business. Here are some of the advantages of choosing home business as your smart choice for the source of income. 

  • No Need to Commute. This is one of the most obvious reasons why lots of individuals choose home business: there is no commuting necessary. Imagine a day where you spent sitting in a car, a bus or at the subway while fighting your way to work. Home-based business owners don’t need to do all of that, for their commute is consists of just walking down a flight of stairs.
  • Lower overhead. If you are a home business owner, chances are you do not need to spend buying or renting business premises, thus, making your overhead lowers considerably. There will be no separate office to maintain or rent. This will help you save money on other miscellaneous such as utilities, licenses or taxes.
  • Advantages of income tax. Yes, you heard it right. When you run a home-based business, it will be a great way for you to recoup some of your business expenses. In some cases, you just need to reduce the income tax amount which you have to pay.
  • More quality time with the family. Operating a home business gives you more flexible time with your family, especially if you have children. When they grow up, you also might employ your sons or daughters in your business for it is completely legal to do so.

The rise of home business will continue not just this 2018 but also for the next years to come. If you’re planning on shifting from office-based to home-based, then this year might be the perfect year for you.