Owning a Business

Why Everyone Should Own Their Own Business

Should Everyone Should Own a Business

Well maybe not everyone, but each family unit should have one.

If you own a legitimate - for profit - business, the tax breaks are too good to pass up.

Besides that, every family should have multiple streams of income to protect it if the seemingly inevitable layoff strikes one or both of the breadwinners.

A Second Source of Income

Even if you and your spouse are employed now, there is no guarantee that it will last.

Too many companies look at payroll costs as one of the first things to cut when they become stressed.

With rising fuel prices, a falling dollar and the lingering effects of the sub prime mortgage mess still working their way through the financial world, many economists predict an upcoming recession, which won't be good for the job market.

But even if times are good, look to start a home based business.

As a matter of fact, it is best to slowly work yourself into a sideline business when you do have a job and an income. If you're lucky, you might even be able to quit your day job!

But even if you are only making a few hundred extra dollars a month, it could be the cushion you need to get through tough times.

What to Do?

The best thing to do is to turn something you are already doing into a home based business.

So if you love to cook, maybe you can cater small affairs or sell your homemade sauces or jams at fairs, flea markets or even local food shops.

If you can bake, maybe you can find an outlet for your goodies in the same places.

The list is endless - all well made crafts, woodworking skills, love of animals etc, etc can be turned into a business with a little imagination.

With the ready availability of computers and Internet access, you have a multitude of ways to make money sitting on your desktop.

If you can do research and write articles, you can hire yourself out to web site owners who need that service.

The same goes if you can write computer programs, do graphic design or simply want to become a "virtual assistant" and do the mundane tasks busy web site owners want to farm out.

There are numerous sites where you can bid on such projects - such a ELance.com or RentaCode.

Or you can start a web site, open a drop shipping business or sell things on eBay.

The bottom line is the possibilities are endless.

Finally, I am suggesting you start slowly at your own pace. If you can only work on the weekends, than do it that way. But the idea is to start to do something.

All business start slowly anyway, so you might have to wait a few years before you start making real money.

The Advantages of Owing a Business

First you are building something with equity - something you can possibly sell or pass on to your children.

You are supplementing your income - giving you that little bit extra that will make your life more secure and pleasurable.

And finally, you are creating a great tax break that is really hard to pass up.

If you are going to start any kind of business, see an accountant and structure it correctly. Maybe you need a LLC (Limited Liability Corporation) or a S-Corp. An accountant will help you decide which would best serve your needs of minimizing taxes and even sheltering some of your income from your day job.

You can then draw up the necessary papers using one of many web sites that offer incorporation services.

I cannot emphasize enough that you need to run your business in a businesslike way and truly try to make a profit. If you don't the IRS will be knocking on your door.

But you don't have to be profitable to take advantage of certain tax breaks.

Here are some of the benefits:

• If your business is located in your house, you can write off a portion of your mortgage payments, utilities, property taxes, homeowners insurance, repairs and maintenance
• The tools of your trade are tax deductible - you can write off computers, a new lathe, oven or any other products you need to produce your product.
• If you get the necessary business licenses you can get materials you already buy at wholesale
• You can write off business related trips - to trade shows and the like
• If, for example, you love to golf and have a business related to golfing, you can try out the golf courses of the world on Uncle Sam.
• You can hold an annual "corporate retreat" at or near your favorite resort.
• You can buy products, magazines and books for testing and research
• You can write off health insurance premiums
• You can open a separate 401k or other type pension plan for your business' employees - including yourself.
• You can write off a little over fifty cents a mile for business use of your vehicle or, if you want to keep the records, the business percentage of the cost of a bought or leased vehicle including fuel costs, maintenance and insurance.

Before you do any or all of the above, meet with your accountant and discuss what you want to do. You must maintain proper records and be able to show the IRS the relationship between expenses and the business you are trying to run.

Conclusion

If you want to deduct the cost of a new computer that you would have bought anyway, if you want to upgrade equipment you need for you ex-hobby or if you want to travel on the government's dime, owing a business is a way to do it.

There are just too many advantages to ignore - so begin your research and see what you can do to take advantage of this great opportunity.

For more information and ideas, read Employ Yourself.

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