The Benefits of Employing Your Children
The Benefits of Employing Your Childrenby
How many times a week do you hear, "Mom, I need a new pair of shoes!" or "Dad, can I have money to go to a movie?" Not to mention the cost of school supplies, braces, and college tuition that haunt every parent. If you're like the average parent, you probably spend several thousand dollars a year providing for all the needs and wants of your children. But unlike most Americans, if you are a home-based business owner, you can make those thousands work for you.The IRS allows you to hire your school-age children as part-time employees for your business. Then, you pay them a reasonable salary for their work that is then used to cover all their expenses. And their salary is completely tax deductible.
Plus, as employees, their medical expenses can also count as tax deductions.For example, if you have two children, one age 10 and another age 17, you can officially and legally hire them to work for you. Perhaps the ten year old can clean up your home office or sort mail while the older child could answer phones, handle filing, or type correspondence. No matter what responsibilities you elect for your offspring, make sure to prepare a formal employment agreement between you, as business owner, and your child. Make sure your agreement includes a list of duties, the compensation arrangement, and any special details you want to have in writing. In addition to the official agreement, you can create a job title and description for your new "employee".
Not only will this help to audit-proof the deduction, it will also clearly spell out for your child what his or her responsibilities are.There are some restrictions, however. For instance, the child's yearly income (according to 2001 tax regulations) can be no more than $4550. Additionally, the pay rate must be comparable to similar services offered by professionals.
If you are paying your child for vacuuming or dusting, you should contact cleaning services in your area for a written estimate and base his or her wage accordingly. Also, the child must maintain a record of his or her work.
The log must include the date, type of work, time worked, and hourly rate. The last restriction is that the child must be paid what he or she earns. So you will need to open separate checking accounts for the children in which to deposit their salaries. All the expenses then can be covered from that account, including entertainment, clothes, school expenses, or even a car or college tuition.The IRS also allows all medical benefits provided by a business to its employees to be claimed as tax deductions, so if your child is your employee and you have to pay for his or her braces that hefty expenses can be completely tax deductible. Even if your child is covered by your spouse's insurance plan, you can claim all co-payments or non-covered medical charges.
There are no minimum or maximum levels either: every dollar you pay out can be counted as a tax deduction. However, your policy for covering these expenses must be in writing and copies of all receipts and bills should be maintained for your business records.Besides the obvious benefits of being able to write-off these costs, hiring your child as an employee can have other positive effects. You will save time because of the additional help your new staff will provide. While they handle the menial duties, you can concentrate on running a successful business and earning more money. And with your children on the staff and on the payroll, they - and your spouse - will be more likely to support your venture.
There's also no better way to teach your children the value of money than by having them work for it and get Uncle Sam to pay for it.-----------------------------------------------------------------Discover little known but highly lucrative tax advantages you can legally claim as a home based business owner by visiting http://www.homebusinesstaxsecrets.com Get the FREE REPORT: "5 Hidden Tax Dangers..." that shows you how to save $1000's in taxes and avoid costly audits..
New Mutual Fund Guide Focuses on Novice Investors
San Diego, CA (ContentDesk) February 27, 2006 -- In eight chapters, his Beginner's Guide to Top Low Cost Common Stock Mutual Funds (ISBN: 1-4116 6908-8) explains to first time investors how funds work, their tax aspects, guidelines about when to sell, and why a buy-and-hold strategy beats market timing.
In addition, he details for purchase 13 top low cost funds, including one that over three decades turned $10,000 into
$395,000.
"Making money in the stock market is a no brainer," he says, "if you just let our economy, a tremendous money-making machine, work for you.
And you can make it work for you by having patience and buying and holding for the long term proven quality funds." About the AuthorSteve Haberman practices what he preaches.
For over 30 years, through good and bad times, he's invested in no load funds.
Through his common sense approach, he's profited greatly and been able to travel extensively throughout Europe.
Tax help > New Mutual Fund Guide Focuses on Novice Investors
Top 5 Overlooked Tax Deductions
Copyright 2006 Kristine McKinley
How many times have you done your taxes, and a week or a month later realized you forgot a deduction?
The tax law is very complicated, so it's easy to miss a deduction or two.
In my experience, these are the top 5 missed deductions.
1. Non-Cash Donations
Did you clean out your closets this year?
Chances are you donated those items to Goodwill or a similar non-profit organization.
The value of donated items (clothing, furniture, etc.) is deductible.
You will need to get a written receipt and assign a value to these items, but the tax savings are worth the effort.
2.
Points on Refinancing
With interest rates so low the past few years, there have been a record-number of houses refinanced.
If you refinanced, you may have paid points to get a lower interest rate.
These points are deductible over the life of the new loan.
...
Tax help > Top 5 Overlooked Tax Deductions
Cyprus is Hotter Than Ever
(ContentDesk) October 26, 2005 -- Stuart Law, Managing Director of Assetz International, comments: "High standards and low costs of living along with virtually non-existent crime rates and numerous tax advantages make Cyprus an attractive option for UK investors."Prices are still considerably lower than in France or Spain - a three-bedroom detached villa with a private pool would currently set you back around ?250,000 in a quality location, which would probably only stretch to a large two-bedroom apartment in the South of France. Capital growth is expected to continue at a high level for the foreseeable future due to interest from buyers all over Europe and an undersupply of property."British nationals living in Cyprus account for 1.5% of the total population, with British retirees benefiting from being able to draw their pension without paying UK withholding tax, at a flat rate of 5%. The most popular destination for tourists and homebuyers is Paphos, say Assetz, which offers stunning...
Cyprus is Hotter Than Ever
Tax help > Cyprus is Hotter Than Ever
JK Harris 165 Services Expanding Reach Via Nationwide Sales Team
JK Harris 165 Services, the nation's leader in assisting victims of investment fraud recover some of their losses through an often overlooked tax provision called Section 165 (c)(2), is expanding its reach by utilizing JK Harris and Company's nationwide sales force.Section 165 (c)(2) of the IRS tax code allows victims of investment fraud to accelerate the deductions for their losses and realize immediate and substantial tax benefits. Headquartered in Tampa, Fla., 165 Services became a part of the JK Harris family of companies in October of 2002 and currently employs 21 people.
JK Harris and Company (www.jkharris.com) is the nation's largest and most successful tax resolution firm.Due to the reach of JK Harris' sales force, which mans 470 satellite offices in 45 states, JKH 165 Services will now be marketed to the thousand of clients the company's Consultants see each month, according to JK Harris Executive Vice...
Tax help > JK Harris 165 Services Expanding Reach Via Nationwide Sales Team
Estate Planning and Insurance Concerns When You Divorce
If you are getting a divorce from your spouse, you have a lot of planning to do.
You will need to name your own beneficiaries, organize your divided assets, and
set up your individual estate. It is important that you meet with a qualified attorney to discuss the specifics
of planning your estate to ensure that your wishes are carried out as you desire. You need to be well versed in the most strategic methods of dividing your joint estate so that you do not end up paying all of the taxes while he or she enjoys the benefits of your assets. I have outlined some important information for you to be aware of when planning
your estate after your divorce.
Please keep in mind that divorces lend themselves
to new structures for individuals. You will want to meet with a qualified attorney
to discuss how to best protect your new estate. Assigning Your Beneficiary
During your marriage, chances are your spouse was the...
Tax help > Estate Planning and Insurance Concerns When You Divorce