Alternative minimum tax liability: The alternative minimum tax (AMT) can sneak up on unsuspecting taxpayers. It applies if your AMT liability, based on a special tax computation involving tax preference items, exceeds your regular tax liability. Individual taxpayers should have their AMT liability calculated before year-end. Depending on the result, it may be advisable to shift tax preferences to next year to avoid or reduce AMT liability. Alternatively, you might accelerate income into 2004 if the AMT rate is lower than your top marginal tax rate.3.

Section 179 allowance: Under Section 179 of the tax code, you can elect to currently deduct some or all of the cost of business assets placed in service anytime this year. For 2004, the maximum Section 179 allowance, which was quadrupled from $25,000 to $100,000 for 2003, has been increased slightly to $102,000. The maximum allowance reverts to $25,000 for the 2006 tax year.4. Bonus depreciation deduction: There is an extra tax incentive for buying equipment for your business this year. For assets acquired after May 5, 2003 and placed in service before January 1, 2005, you can claim a 50% bonus depreciation deduction in addition to the regular first-year depreciation deduction and the Section 179 allowance.

As things stand now, the bonus depreciation deduction is scheduled to go off the books after 2004. 5. Estimated tax penalties: Even if you do not have enough federal income tax withheld during the year, you can avoid an estimated tax penalty by meeting one of two safe harbor exceptions. No penalty is imposed if annual tax payments for 2004 equal 90% of the current year's liability or 100% of the prior year's tax liability. The percentage for the 100% safe harbor is increased to 110% if your adjusted gross income (AGI) for the prior year exceeded $150,000.6.

Medical and dental expenses: You may deduct unreimbursed medical and dental expenses to the extent the annual total exceeds 7.5% of your AGI. Try to bunch together non-emergency expenses (e.g., new eyeglasses or dental cleanings) in the tax year that provides the best opportunity for a deduction. Note: Do not forget to include co-payments required under a company health insurance plan.7. Dependency exemptions: The parent of a full-time student under age 24 can still claim a dependency exemption for the child by providing more than 50% of the child's support. Depending on the situation, it may make sense to add to the support total at year-end in order to clear the 50% mark.

Each dependency exemption for 2004 is $3,100.8. Wash sales: Under the wash sale rule, an investor cannot claim a tax loss if he or she buys back substantially identical securities within 30 days. To avoid this result, you can (a) wait at least 31 days to make the purchase or (b) buy replacement securities first and wait at least 31 days before selling the original shares. Note: This must be done more than 30 days before the end of the year to realize the loss in 2004.9. Hobby losses: If you operate a sideline business, you can claim a tax loss for the year, but be careful.

If the activity is characterized as a hobby, not a business, your loss is deductible only up to the amount of your income from the activity. Since the IRS generally presumes the activity is a legitimate business if you have shown a profit in three out of five consecutive years, you might accelerate income into this year and defer deductions to next year.10. Income-shifting: You can reduce the overall family tax bill by shifting taxable income from your high tax bracket to other family members in lower tax brackets. For instance, you might transfer income-producing property to custodial accounts for your minor children. Caution: Be aware of the "kiddie tax." To the extent that the unearned income a child under age 14 exceeds an annual limit ($1,600 for 2004), the excess is taxed at the top marginal tax rate of the child's parents.In summary: You may be able to use one or more of these techniques to reduce your 2004 tax bill.

However, tax planning cannot be done in a vacuum. If you have additional questions concerning your tax return, consult with a CPA. To find a CPA, find one through NABA's Division of Firms, www.nabadof.org..

However, here are some items to know that could help you prepare for the mortgage loan process. A self-employed mortgage loan survival guide, if you will.While confirming your income - the average lender will need to be made aware of at least 2 years of self employment history, occasionally they will request 3 years. They will ask to see this history verified in tax returns, generally. Occasionally the lenders may figure your income as being the average income you claimed on your income taxes as profits, not your gross business income. Another time the lender may figure your income as the lowest of the two years and every now and again as the highest of the two years.

Talk to your mortgage professional or lender and find out their verification criteria. For instance, some lenders may calculate a part of your write-offs or deductions and work it back into your income. There are ideas of additional ways that a lender may be able to verify your income and if you are a free agent it may help you to be able to show a supplementary of your income.If you can, compile a profit & loss statement , accurately quoting your expenses & profits for the last couple of years. You may find this tedious, but it could be used as proof of income for a mortgage provider. If you can get it signed or verified by your accountant, more's the better.If you can, it's always best to provide your bank statements to prove your income - search for a lender who might accept as little as 2 years of statements as sufficient proof.

These days, you'll find that many lenders confirm your income in this fashion. This is normally a more favourable method of proving your income than lifting the figures from your tax returns. The reason being that you can, more often than not, show that you have a lot more additional cash flow than your tax returns might indicate. When completing your tax returns you generally subtract every single business expense prior to your claim of any profits. By employing bank statements, you are still proving income, this reduces the importance of your credit score or deposit during the application process - while a "self-cert" or "self-certification" mortgage will place more emphasis on your credit score.If you cannot provide statements, apply for a "self cert", or "stated income" mortgage.

This type of loan is very common these days. You actually need no proof of income, you simply state on the application form, the level of your income. It doesn't require verification on your part! This might help if you are freelance and need to specify your income as it currently stands. This method means that you don't have to worry about having the lender take your last two years worth of income and average them out. Whilst many people do abuse this feature, it's best to be accurate when self-certifying your income.

Sometimes the lender will be able to obtain proof from your tax office to confirm your self-cert amount. Whenever you choose a self-cert loan, this will put more weight on the importance of your deposit and/or credit score. So, you might normally need one or both of these elements to be strong if you want to pursue this avenue. More often than not, when you do a self-cert, you could well be charged a marginally higher rate of interest because the lender will see this as more "high-risk".Lenders make money by lending it to so they are always looking for ways to make it easier for you. There are several ways that lenders may work with you if you are freelance.

The advice of a good, independent financial advisor is recommended and there are a proliferation of programs available to help you. If you can lay your hands on a deposit or you have good credit, you are halfway there! You're almost guaranteed to find a lender somewhere so don't despair!.

When paying off your credit cards, keep in mind to pay off those cards with the highest interest rates first. This will help you keep your interest charges to a minimum. Invest in Your House Before spending your tax return impulsively, consider spending a portion of that money towards the largest investment that you probably own, your house. A complete termite inspection, a new coat of paint, new carpeting or remodeling your old kitchen can not only improve the quality of your life, it can also increase the overall value of your home.Create an Emergency AccountAccording to credit experts, consumers should initiate an emergency fund and put away 3 to 6 months worth of living expenses. This type of fund can relieve a great amount of stress and anguish if you suddenly lose your income.

You can easily create an emergency account by utilizing your upcoming income tax return. When selecting an investment, make sure you select an investment that is fairly liquid, such as Certificate of Deposits (CD) or a money market account where your savings are easily accessible.Save for RetirementAccording to the 2004 Retirement Confidence Survey conducted by the American Savings Education Council (ASEC), only 6 out 10 workers are currently saving for retirement. If you have not started saving for your future yet, CreditGUARD of America recommends that you initiate a savings plan with your income tax return. Contributing a percentage of your monthly salary to a 401(k) plan or initiating an Individual Retirement Account (IRA) can provide the much needed monthly income when you retire. Open a College Savings PlanCollege Education is getting more expensive by the year.

Nowadays, a typical four-year college education can cost upwards of $100,000. According to savings experts, the average cost of tuition and fees rose to 9.6 percent at four-year public schools and 5.8 percent at private schools in the previous academic year. State governed 529 college savings plans are the most effective tools when saving for college. Under 529 rules and guidelines, parents can contribute up to $250,000 per beneficiary. The 529 college savings plan works much like a Roth IRA, where withdrawals are completely tax-free when used for higher education purposes.

CreditGUARD of America is a non-profit credit counseling organization that assists consumers through credit counseling and financial education. Please visit our web site at www.creditguard.org or call 1-800-867-0406 for a free consultation with a certified credit counselor..

This holiday is an obvious choice for a fitness trainer or nutritionist, but can be a great topic for other businesses like an accounting firm.A few ways in which our sample holiday can provide newsletter content:-Graphics: a heart association logo*; a heart shape; a heartbeat image-Themes opics: healthy heart/lifestyle, recognizing symptoms of heart problems-Tips: diet, exercise/ lifestyle, checkups, recipes-Public Service: Raise awareness, learn cpr, donate A business like our accounting firm can provide a public service announcement and they can customize the information to their expertise by providing answers to the following questions: If you join a health club, is that a tax-deductible expense? A nutritionist? Is installing a gym on site for your employees tax deductible? Did you know improving your health can translate to lower premiums on life insurance? Questions like these can also be formatted into tips, which can then be offered to other publishers as content, increasing their exposure and further establishing themselves as experts. Can't find a holiday to suit your business goals? Create one! All you need to do is come up with a theme and a name, and declare it! Who knows, maybe one day Hallmark will immortalize it with a line of cards to send out for your holiday. In any event, have fun and keep those ezines full of celebrations and great content.Everyone loves an excuse to celebrate so why not be the inviter; the business that follows is an added benefit to the good will you inspire.*Please make sure you have necessary permission before using an image or content..

The most common are by correspondence. The IRS may request further documentation by mail. You should send copies only and always keep original records in your files for at least three years, the amount of time the IRS can go back and audit a return. Keep in mind, the IRS may go back indefinitely if they suspect fraud. The second type of audit is face-to-face.

These occur when the amount of documentation requested by the IRS might be too large to handle by mail. In these cases the taxpayer must visit a local IRS office on a specific date. AUDIT ADVICE--1) Act promptly. The longer you wait to respond to an audit the more you can pay in interest and fines. 2) If you have a conflict with the date or need more time to get records in order, call and reschedule the meeting.

3) Be friendly when dealing with IRS agents. They might have leeway when it comes to accepting partial records and documentation. Being cordial can't hurt. 4) Be honest. On the other hand, don't volunteer any information that isn't asked for.

5) Carefully choose your tax preparer. Be sure he or she would be able to help you with an audit. And remember, if you sign a return you are taking responsiblity for that return. Blaming your accountant or brother-in-law won't help during the audit..

1. Simplifying Administration Process
2. Intestacy & Distribution of Assets
3. Inheritance Tax

Where no will has been made the process of applying for the grant is drawn out, causing aggravated upset and anxiety for relatives and possibly acrimonious disputes and legal costs over who should deal with the estate. A valid Will resolves these problems as persons will already have been appointed by the Will ? executors ? to deal with the estate and can obtain the grant and begin the distribution of the assets in a minimal period of time thus saving costs, time and unnecessary distress.2. Intestacy & Distribution of AssetsMaking a Will is the only way to ensure that the people you wish to inherit from your estate actually do so. Failing to make a Will will result in the law of Intestacy being applied, and the intestacy rules will dictate who will receive what, and often this will not accord with what you would have wanted. For example;

1. If you are single you may want to distribute your assets amongst selected friends and family.

   The rules of intestacy will not take into account any relationships based on friendship, and will distribute amongst relatives only, everything passing to the State if no relatives can be found.

2. If you are living as cohabitees (unmarried couple) you may want your partner to derive some benefit from your estate, perhaps to remain in the family home for example. The rules of intestacy would not take your partner into account; as far as the law is concerned, you would be treated as a single person and your partner would receive nothing.
3. If you are married with children you might assume that your spouse would receive everything. This is not always the case, as brothers and sisters and often your children will also have a claim.
4. If you are a parent, you might assume that if anything were to happen to you that your closest relatives would be responsible for the care of your children. However, the matter will need to be taken to the Courts for them decide who should have custody, a process which can be very drawn out and distressing to the parties involved. This particular consequence is of vital importance if you are a single parent or unmarried couple with children.

   Making a Will is invaluable by appointing Guardians to be responsible for the care of your children.

In addition, you might be dismayed to discover that you also be liable to pay inheritance tax!The following table provides a breakdown of how much inheritance tax might become payable on your estate.Estate Value Taxable Estate IHT Tax @ 40%?275,000 or less 0 0?300,000 ? 25,000 ?10,000?350,000 ? 75,000 ?30,000?400,000 ?125,000 ?50,000?450,000 ?175,000 ?70,000?500,000 ?225,000 ?90,000Making a Will is one of the best tax avoidance tools you can employ ? in addition to others and utilising the exemptions which are available.Making a Will is probably one of the last ? and most important ? undertakings you can do for the benefit of your family and those you love?failure to make one can have far reaching and dire consequences.JsByrneLLB (Hons) LPc.www.Draft-Your-Will.com.

Well, the purpose of this article is to do exactly that, inspire you. I'm going to cover with you the 10 main reasons why You should consider starting your known 'Home Based Business' and the benefits behind each of them. I guarantee once you read through them you'll agree that a 'Home Based Business' might be worth considering. With that said, let's go to reason #1. 1.

Be your own Boss. Ever dream of being your own Boss? Well starting a 'Home Based Business' is a step in the right direction and the best part is, you'll never have to answer to anyone else's orders, just your own. 2. Work when you want to. This is probably one of the best reasons in my book for starting a 'Home Based Business' simply because you get to set your own schedule for what hours You want to work.

This is especially beneficial for stay at home moms who have children to tend to and need some flexibility in there work schedules. 3. Freedom to do what you want when you want. How's that for a reason to get started. By being your own boss and being able to schedule your own work hours you NOW have the freedom to do what you want when you want to with whom you want at anytime.

It's a great feeling to be in control of your own life and do what you want when you want. 4. No more worrying about job security. By having you own 'Home Based Business' you never have to worry about receiving a pink slip from your boss or a "SORRY", but the company has to cut back on its employee's and You happen to be one of the one's who has to go. 5.

It doesn't interfere with your current "J.O.B.". That's right, you don't have to quit your current J.O.B. in order to get started. You can start on a part-time basis until your able to replace your current income with the income you generate from your business. Remember, you get to set your own hours for when you want to work your business.

6. It will make you a more confident person. By setting out and starting your own business it'll make you a more confident person because it takes alot of confidence to start something you have no idea what the outcome might be and the risks involved, whether there financial or personal. 7. It builds a sense of pride.

Wouldn't it be great to be able to tell your friends and family or just somebody you meet that you're an entrepreneur and you run and operate your own successful 'Home Based Business'. Pride also works as a motivator because the more successful you get the harder you'll want to work in order to achieve the goals you have set for your business. 8. It's all for the MONEY. MONEY is a pretty obvious reason for starting a 'Home Based Business' because Why would you otherwise start a business if you weren't planning on making any MONEY.

It also builds a sense of security for your way of life and the things you enjoy doing because the facts are... nothing for FREE. Everything has a price. 9. You get great Tax benefits.

You heard right, you get Tax benefits with running your own 'Home Based Business' because now you're entitled to home business tax deductions. This is a category in it's own and getting a good CPA who has experience with home based business tax returns will be essential in order for you to maximize your return for the year. 10. Wouldn't it be great to retire early. If your business turns out to be a SUCCESS and you invest and put your money to work for you, wouldn't it be great to retire early and do the things you've always dreamed of doing, but never had the time or money to do so.

There you have it, "10 POWERFUL Reasons Why You're Crazy NOT To Start A... Home Based Business In 2005". Now, if those 10 reasons don't get you excited about starting a 'Home Based Business' then I have failed to inspire you. If you need to read through them again, do so now. These are the very reasons I contiplated before starting my home based business and in my mind are the most common.

Write down for yourself why You would want to start a 'Home Based Business', I bet you'll come up with several of the reasons I've listed above. With that said, there's one more thing I want to mention and that is if you are seriously thinking about starting a 'Home Based Business', whether it be online or offline, make sure you put together a 'Step-By-Step' business plan on the actions you must take and make sure you start a business you enjoy doing..

It is an excellent financial planning tool used from people of all walks of life. How do I qualify? You must be 62 or if both parties are on the mortgage, then you both must be at least 62. And, you must have equity in your home.What if I still owe on my home? You may still qualify even if you have a balance on your first mortgage. The proceeds must be used to pay off the mortgage, first. How much can I get? This depends on several factors such as, the age of your home, the value, your age at the time of closing, and interest rates.Is it just monthly payments? No.

You can get a lump sum, line of credit, monthly payments or a combination of monthly income and a line of credit.But, won't I have to pay taxes on these monthly payments to the government? No. The funds are tax-free. Its your money, not additional income. Should I seek a lawyer or receive some counseling before I get a reverse mortgage. Yes.

You must be counseled before receiving a reverse mortgage. You don't have to talk to a lawyer or accountant, but it would be advised.Who owns the title to my house? You still own the title.What happens when I die? Once your home is passed on to your heirs, the mortgage becomes due. Your heirs may pay the mortgage and keep the home or sell the home and pay off the home. They may keep any excess sales proceeds.What if I owe more than the house is worth? You can't. Your repayment amount will never exceed the value of the home at the time the loan comes due.

Also, there are no prepayment penalties. What if I move? If you move, then the mortgage becomes due and must be repaid. Where can I learn more? The National Reverse Mortgage Lenders Association at http://www.reversemortgage.org.