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Taxes Information |
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Seven Key Tax Deductions for the Self Employed
As a sole proprietor, it's wise to familiarize yourself with the some key deductions that may reduce your tax bill for 2004. Small-business consultants generally recommend that you hire an accountant to prepare your tax returns, payroll and financial statements. But you should also meet with your accountant well before the year-end rush to discuss such matters as tax planning, and record keeping for tax deductions. Seven common small business tax deductions: 1. Employee Benefit Plans - You may deduct contributions to employee benefit plans (such as health insurance plans and retirement plans). Depending on your circumstances the maximum contribution that you may deduct per employee in a qualified retirement plan can go up to: $100,000 or more For a Defined Benefit Plan 2. Automobile Expenses- You can elect to deduct the actual expenses incurred (including gas, oil, tires, repairs, insurance, depreciation, and rent or lease payments) for the business-related portion of your car or truck expenses, or simply take the 2004 standard mileage rate of 37.5 cents per business mile. 3. Taxes - You may deduct Social Security and Medicaid taxes paid to match required withholdings on employee wages, federal unemployment taxes, sales taxes and real estate or personal property taxes paid on business assets. 4. Home Office - Depending on whether you use your home or other real estate for business purposes, you may deduct some or all of any mortgage interest paid, as well as some or all of the maintenance and repair expenses associated with the property. The cost of utilities and business supplies associated with business use are also deductible. 5. Depreciation - Depreciation may be taken on passenger cars, equipment used for entertainment or recreational purposes (i.e., photographic equipment, cell phones and computers), as long as these items are used solely for the business. 6. Professional Fees - You may deduct professional fees, such as those paid to a lawyer or accountant. 7. Meals and Entertainment - You may deduct 50 percent of meal and entertainment expenses directly associated with the conduct of your business Remember to keep on file the records and documentation necessary to substantiate all of your deductions. Daniel Lamaute, of Lamaute Capital, Inc. specializes in setting up retirement plans for small business owners. http://www.InvestSafe.com
MORE RESOURCES: Benefits paid to suffering unemployed workers will have to be cut and taxes on struggling businesses will have to go up to pay for a staggering number of claims due to the recession, Wisconsin lawmakers were told Wednesday. The debate over school taxes in Hastings-on-Hudson has revealed the cultural and economic fault lines in the Westchester County river town. MANILA, Philippines - The country's next president will have to turn his back on populist promises made during the campaign and raise taxes sooner rather than later to prevent a financial crisis soon after the May elections. Waukee residents will pay slightly higher property taxes to the city under a budget that will take effect on July 1, though the city’s levy rate will not change from recent years. MANILA (Reuters) - The Philippines' next president will have to turn his back on populist promises made during the campaign and raise taxes sooner rather than later to prevent a financial crisis soon after the May elections. Moore County has advertised tax liens against Little River Golf Club and other properties of the resort for failing to pay about $220,000 in property taxes. A small jump in the tax levy, combined with a larger drop in property valuations, should result in a drop in taxes for most Bayport property owners. If President Obama's proposal to apply a Medicare levy to investment income had been in place in 2008, the Obamas would have paid roughly $75,000 more in taxes that year. Faced with failing to make annual $1 million payments promised to the owners of Reno's Triple-A baseball team, city officials propose to use sales taxes generated by a planned retail development near the stadium to cover the debt. With April 15 right around the corner, accountancy department chair Keith Smith has words of wisdom for students filing taxes. |
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