Your Tax Place, Inc. - Tax Savings Strategies

  What is an ASSET and WHAT Makes it DIFFERENT from SUPPLIES? Purchasing an ASSET is the easy part , but when it comes to  Deducting an ASSET  on your tax return,   it must be reported differently   than the other expenses such as  SUPPLIES. Did you buy a CB Radio, Refrigerator, a Truck or anything else to be used in your business that is expected to keep its value for more than 1 year and cost more than $100? If you did, you purchased an ASSET for your business. An ASSET is something that provides a current, future, or potential economic benefit for an individual or business or other entity and has the following characteristics: FAIR MARKET VALUE EXCEEDS $100 WHEN PURCHASED IS DESIGNED TO HAVE A USEFUL LIFE AND FUNCTION FOR MORE THAN 1 YEAR IS OWNED (not leased/rented) BY YOUR BUSINESS WAS PURCHASED NEW OR USED WAS PURCHASED BY YOUR BUSINESS AND IS USED IN YOUR BUSINESS Is both ORDINARY and NECESSARY to your business ITS ORIGINAL VALUE

  As we approach year end, everyone begins to wonder, "HOW MUCH MONEY WILL I OWE FOR TAXES for 2022?" As a business owner, it is extremely important to have a PROFIT/LOSS statement that either you prepare for yourself or hire a bookkeeper to prepare for you. Here is how you can figure out the taxes that you may owe by using your last Profit/Loss statement for yourself. As a business owner, nobody except YOU is required to automatically withhold taxes from your pay. And unless you withhold and pay your own taxes, YOU CAN EXPECT TO OWE TAXES ON THE PROFIT THAT YOU MADE. The only way that you will NOT OWE MONEY, is if you did NOT MAKE ANY PROFIT or YOU OVERPAID YOUR TAXES with having children or with estimated tax payments. If you don't generate a profit for any 3 of the last 5 years, the IRS will not let you claim to be a business owner any longer and take a deduction for those expenses. This is VERY DIFFERENT for first time business owners to understand. So, PLEASE R

  Do you pay your workers as EMPLOYEES or CONTRACTORS? With the NEW YEAR now here, it's TIME TO GET THIS RIGHT! One of the most recent HOT TOPICS with both the IRS and the DOL is to investigate businesses for the MISCLASSIFICATION of their WORKERS. For the past few years, businesses have misclassified their workers as contractors instead of employees in order to save 7.65% in matching payroll taxes. Because these businesses have been able to get by without being monitored and corrected, these business owners have become comfortable with this process and don't think they are doing anything wrong. In fact, because a lot of businesses have been operating this way, new business owners starting up the same business believe that it is ok to operate like this as well. The IRS has been aware of this problem and now are about to use their newly hired employees to become very aggressive about correcting this KNOWN PROBLEM to assess back withholding taxes and penalties to those

 Sole Proprietor, LLC or Corporation Which is the best for your business? As a business owner, you should be aware of what each type of business entity offers in terms of taxes, liability protection, and control over the business. The easiest and most common business type is the Sole Proprietorship. As a sole proprietor, you automatically get the new (and misunderstood) responsibility of "self employment" taxes. Sole Proprietorship You have NO LIABLITY protection for your personal assets in case of a lawsuit You have COMPLETE CONTROL over how to run and manage your business There are not usually any start up fees required Most new businesses start out this way until they get a better education about the other options. LLC business type The LLC is also very popular choice among new business owners, but it is not always chosen for the right reason.  Some people claim that there are more tax advantages than a sole proprietorship. However, the truth is, an LLC does not differ

 How to Maintain Success as an Owner Operator - 2022 As an Owner Operator, have you noticed your paycheck  slowly become  LESS and LESS instead of MORE and MORE in comparison with what you have experienced in the past 2 years??? Since 2020 when COVID hit, our economy has NOT BEEN STABLE and has caused many economic imbalances that have NEVER BEEN SEEN BEFORE! I have been in the trucking and transportation industry for 17 years and have NEVER SEEN the consistent $3,000 to $10,000 NET weekly payouts to drivers that I have been seeing in the past 24 months. Most of you veteran drivers have not ever seen this before, either.   And we all  say,  IT'S ABOUT TIME! Unfortunately, these Skyrocketing Rates  that are driving up your pay are NOT SUSTAINABLE , and WILL DESTROY OUR ECONOMY if left too high for long. The Trucking industry is used by economists to predict the health of the economy and to make necessary changes, which is a BIG reason why we are all seeing and ex

  A lot of people that I talk to ask me, " Who will give my business credit ?". Having business credit will help you to purchase the tools, equipment, and supplies that you may need to help you to grow your business.  But, in order to get business credit, your business needs to  Be Separate  from you.  Also, the business needs to have a proven track record of purchasing items on credit and repaying them ON TIME and/or IN FULL each month.    In other words,  Have its own Credit Score. As you know, a Credit Score is given to people/businesses and is attached to the NAME and TAX ID of the person/business for all to review and decide whether or not more CREDIT can be issued. First Step If you want to establish business credit and have established your business as a sole proprietor, the FIRST STEP  you need to take is to Separate   You from Your Business.   You can do this by forming a separate legal entity such as a Corporation or an LLC to allow your business to