The Millionaire's Roundtable with Lynn Richardson Hosted by Lynn Richardson
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Original Article Written by Lynn Richardson for Global Grind…
Let’s take a few seconds to review: when you have a home-based business and properly document your expenses, you can “Get Your Money Back” when tax season arrives by taking advantage of eligible tax write-offs. For example, do you travel, attend conventions, or go out of town to reunions? Well, if your primary intention for traveling is related to your home-based business, then, it becomes a business trip and when you take a business related trip, you can right off your meals, travel expenses, airfare, gasoline, car rental, and hotel. In addition, when you get back home, you get to write off the drycleaning expenses for the clothing that you wore during your business trip. You know my mantra . . . everything is business and quite simply, if it isn’t business, then I don’t go! I don’t care if it’s Madea’s Family Reunion in Tugaloo, Mississippi . . . that’s right, it’s business.
Are you frustrated by the cost of raising children? Well, here’s one home-based business tax write-off I want to share with you that most people have never been told by their accountant: Hire your children in your home-based business and pay each child up to $5,000 a year (they do not have to report income under $5,000 to the IRS). That’s about $100 a week. Then, your children can use the money you pay them for school clothes, dance lessons, food, football, etc. These are items that you have to buy anyway — but you cannot deduct these expenses for your children on your taxes. But you CAN pay your children (up to age 18 – no minimum age – see IRS publication 15) for working in your business. For my family, that’s another $15,000 in tax write-offs each year (because I have three children). Please note, I am not suggesting that you find ADDITIONAL money to pay your children; instead, use the existing money that you spend on their everyday expenses to pay them for legitimately working in your home-based business. Now, you’ll have an additional tax write-off, and you’ll be teaching your children to be financially responsible and run a business in the process.
As always, please check with your CPA or tax professional if you have any tax related questions.