ECL Consulting, LLC is dedicated to informing and educating our clients about business, accounting, QuickBooks and tax issues.
Our biweekly e-newsletter provides timely articles to help you manage
your business and finances and achieve your financial goals. Please come back and visit often.
As
a small business owner you wear many hats. With all the rewards and
responsibilities of ownership, it's no wonder that paperwork often
falls to the bottom of your list, along with organizing your office,
work flow and schedule.
If
you want to eliminate misplaced paper files, know exactly where you put
that document on your computer, have a clutter-free path to your desk,
and remember important deadlines and appointments every time, contact us to put ECL's Organizing Solutions to work for you!
Better yet - call us BEFORE you get stuck to free up your time & start saving money!
Arizona Withholding Changes Effective January 1, 2010
Senate Bill 1185 amended the amounts
required to be withheld for Arizona withholding purposes. Here is the Form A-4
that is effective on January 1, 2010. Please read this Information
Sheet for a description of the changes that will occur in the future regarding withholding here in Arizona.
Dear Client/Friend of ECL Consulting,
Do you run a business out of your home? You may quality for tax deductions. The IRS doesn't restrict the home definition to just houses. Below is a simple guide to home office tax deductions, including a requirements checklist. Ask yourself these questions to see if you are eligible for a business use of the home office deduction.
ECL Consulting, LLC'sBusiness Coaches work with business owners and
managers in the areas of business management, administration and strategic
planning to maximize the potential of the business and help owners realize
their dreams. By coaching you through every vital part of your business,
we help create the plan, inspired action and
measurable results to achieve your vision.
Do You Run a Business Out of Your Home? You May Qualify for Tax Deductions
The IRS doesn't restrict the home definition to just houses. A
business that operates in an apartment, condominium, mobile home or
boat can qualify. The home definition also includes unattached
structures on the property, like a garage, studio, barn or
greenhouse.
Requirements Checklist
Ask yourself the following to see if you are eligible for a business use of the home office deduction:
1. Is your use of the business part of your home exclusive, regular and for your business?
To
qualify under the exclusive use test you must use an area of your home
only for your trade or business. The business area doesn't have to be
in a separate room or blocked off by a partition, but it must be
identifiable. For example, a workstation in the corner of a living
room may qualify, but piling papers on your kitchen table would not. (Note:
The exclusive test doesn't apply to daycare facilities, or in some
other cases, for the storage of business inventory or product samples.
Check irs.gov/smallbiz for the special rules.)
Regular
use means that you use part of your home for your business on a
continuing basis. Occasional business use is not enough to meet this
requirement - even if you use an area designated exclusively for
business purposes.
If you use part of your home for business, you may be able to deduct
expenses for the business use of your home. These expenses may include
mortgage interest, insurance, utilities, repairs and depreciation. The
home office deduction is available for homeowners and renters, and
applies to all types of homes, from apartments to mobile homes. There
are two basic requirements for your home to qualify as a deduction:
1. Regular and Exclusive Use. You
must regularly use part of your home exclusively for conducting
business. For example, if use an extra bedroom to run your online
business, you can make home office deduction for the extra bedroom.
2. Principal Place of Your Business. You
must show that you use your home as your principal place of business.
If you conduct business at a location outside of your home, but also
use your home substantially and regularly to conduct business, you may
qualify for a home office deduction. For example, if you have in-person
meetings with patients, clients or customers in your home in the
normal course of your business, even though you also carry on business
at another location, you can deduct your expenses for the part of your
home used exclusively and regularly for business. You can deduct
expenses for a separate free-standing structure, such as a studio,
garage or barn, if you use it exclusively and regularly for your
business. The structure does not have to be your principal place of
business or the only place where you meet patients, clients, or
customers.
Generally, deductions for a home office are based on the percentage of
your home devoted to business use. So, if you use a whole room or part
of a room for conducting your business, you need to figure out the
percentage of your home devoted to your business activities.
2. Does the business part of your home serve as either
your principle place of business
a place where you meet with patients, clients or customers or
a separate structure not attached to your home, used for business purposes
When your home is your principle business location
Even
if your business has several locations, you may qualify for a deduction
if your home is the principle place of business activity. You will
need to prove that you use your home office exclusively and regularly
for administrative or management activities and are unable to perform
those activities at any other fixed location. You can still outsource
administrative tasks from other locations and pass the principle business location test.
When you meet with customers, patients or clients in your home
If
your business doesn't meet the requirements as a principle place of
business, it might qualify as a meeting place. If you meet with
customers in your home as a normal course of your business, you can
deduct expenses for the area of your home used exclusively and
regularly for meetings.
To qualify, the use of your home
as a meeting location must be necessary and integral to your business.
Using your home for occasional meetings or customer calls does not
qualify you to deduct expenses for the business use of your home.
When your business is run out of a self-standing structure
You
can deduct expenses for a separate free standing structure on your home
property, such as a studio, garage, storage shed or barn - if you use
it exclusively and regularly for the business. A self-standing
structure does not have to meet the requirements of a principle place
of business or a meeting place.
Deduction Limitations
Most deductions for the business use of your home
are limited to the percentage of your home used for business or
business percentage. Don't qualify for a deduction? When you have a
business in your home you may be able to deduct a percentage of your
home expenses such as insurance, utilities and depreciation. You may
have to do a little research, but it could be result in extra money in
your pocket.
Home Deduction Myths and Scams
Have
you heard about home-based deductions that seem too good to be true?
Chances are they're a common misconception. The IRS helps to separate
the facts from myths:
Non-deductible personal living expenses can not be transformed into deductible business expenses
You
can't use your home's operating expenses, or your home's depreciation
deduction to create a net loss for a business operated out of your home.
Beware
of scams that involve unprofitable home-based businesses claiming
personal expenses as business expenses. No matter how convincing the
information and marketing materials may seem, if you encounter what
looks like a home based tax avoidance scheme, check it out.
Visit the IRS page on Home Office Deductions for a full explanation of tax deductions for your home office.
Contact
ECL Consulting, LLC
today to schedule your initial consultation with a Business Planning
Coach and start building an effective plan for your business!
Ask
An Expert
Q: It's been a rough year. How can I maintain sales through the holiday season?
A:Here are some marketing options to
consider as part of your small business holiday plan:
1. Promotions,
Incentives and Giveaways - That Needn't Break the Bank.
Promotions and incentives needn't be
restricted to the mall and Main Street. Whatever your business or industry
there is usually a season-appropriate discount, bundle or giveaway that you
can offer your customers.
When determining your offer, think
about the season and what you can do to help your customers get through the
stress and expense of the holidays -
then create a compelling reason for them to act now. For example rather
than simply discounting your services, offer a packaged offering: "Buy X
service now and we'll provide Y for free in the new year."
Reducing your customer's burden can
even be achieved with the instant gratification of a giveaway. These don't need to be
expensive. Even something as simple as offering a free holiday cookie or apple
cider when they visit your store/business location can make you stand out.
If you are a freelancer, you know
the cash flow pain that comes at this time of year. Nevertheless, don't be
afraid to position your services for the holiday season and offer your clients
special incentives, too. Find out what their holiday business plans are and
offer them a "holiday special." This could be a value rate for bundled services
or a repeatable cookie-cutter project that you can offer all your clients to
help them out during the holidays. For example, a logo/Web site festive
re-design or fixed price marketing campaign would be appropriate.
2. Get your Web
Site Ready for the Holidays.
If you have an online presence or
operate an online business, here
are some
simple ideas for prepping your site for the season:
Decorate your Web Site - It's a simple, often overlooked,
tactic that adds a human touch to your operations and makes online shopping
that much warmer and inviting for the consumer. A quick approach is to take a
leaf out of Google's book and pay a graphic designer to decorate your logo; it
won't cost much and can be reused each year.
Don't forget Social Media - Consider customizing your Twitter page and Facebook logo for the holidays
too.
Check that all of your online merchant tools are working properly. There is no surer way to lose a customer than broken links.
Whether you
sell to consumers or business customers this is a great themed way to raise
awareness of the diversity of your offerings and shift extra stock!
4. Don't Forget to
use Email - Properly!
While email
is generally overused it is still an inexpensive and easy-to-implement option
for maintaining contact with existing customers. To be effective, do remember
that mass email marketing should only be used to communicate with those you
have already done business with or who have expressed an interest in your
business or services and have asked to receive email from you - otherwise known
as permission marketing.
Here are some
tips for using effective email marketing to support your holiday marketing
efforts:
Keep the e-mail short, sweet and with direct links to your
promotional offersrather than the home
page - You want to make the process as easy as possible for your customers.
Clearly state the intent of the email in the subject line - For
example, "Thank You for Your Business in 2009 - Here's a Special Offer Just for
You."
Segment your customers according to their buying habits - Most commercially
available email list management programs have a variety of tools that can help
you make sure your readers only get messages that are relevant to them.
Be festive in your design - It'sthe
holidays after all!
Follow the rules of the road - Don't
forget that online marketing is regulated, so whatever tactics you employ, be
sure to follow government
guidelines that apply to
list management, SPAM and other rules of the road.
5. Beef up your
Customer Support
Before you
start any new holiday marketing venture, it's absolutely vital that your
customer support processes operate efficiently. Proactive measures such as email
marketing campaigns and displaying customer reviews on your Web site can help
increase your consumer trust. But, if the staff and infrastructure are not in
place, you're wasting your time. Consider hiring a few temporary holiday staff
to help you keep things running smoothly.
Based on an article by Caron Beesley.
Ever have tax, QuickBooks or accounting question, but didn't know who to ask? Now you can Ask An Expert. Send us your questions and we'll answer it here.
QuickBooks Specials
A+ Consulting, LLC is offering the following promotions:
25% off QuickBooks Enterprise Solutions 10.0
Up to 40% off QuickBooks Point of Sale 9.0 software and hardware
Have you enjoyed this newsletter? Have any suggestions for things you'd like to see covered? Have a question for our resident Accounting Expert? Let us know by emailing askexpert@eclconsulting.com.
Each issue will cover different topics and have different features, so watch for us every other Tuesday.
Remember, we provide accounting and cash flow solutions for successful companies -- yours!
Have any feedback about this email or our new website? Please Contact Us with your questions or comments and we'll be happy to extend a free 1 hour consultation to all new clients!
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anyone who could use ECL's services? When you refer someone who becomes
a client we will give you either $25 off our services or a gift card to
one of many great local businesses. *Please see Referral Rewards on our website for more information.
ECL Consulting, LLC
PO Box 57669
Tuson, AZ 85732 Phone: 1-520-843-2092Ext 1
Fax: 1-520-843-2092 info@eclconsulting.com
