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Internet Business Management - Tax Deductions

Jan 4th 2011 at 4:18 PM

It is 2011. It’s hard to imagine that we are already into the second decade of the 21st century. We all have our new years resolutions. Some of the resolutions will have already ended by now and others will last throughout the years but one of the resolutions that should be practiced is good Business Management - Tax Deductions. A part of good Business Management is keeping good track of your tax deductible items.

You should have been keeping good records of your expenses and income. A network marketer is considered an independent contractor and therefore is self employed in the eyes of Uncle Sam. Being self employed you are responsible for paying your own taxes. My recommendation is to pay quarterly if you are making any income online. This will save you a lot of headache at the end of the year. Be sure to keep meticulous notes of the income that you receive but especially make note of the expenses.

Expenses can get away from you when you are on the internet. It is easy to buy an ebook here and an inexpensive software program there, but if you are not keeping track of those expenses, you will have a hard time deciding how much you actually spent during the year and most likely will not claim all that you could have if you had kept meticulous records. It’s not really that hard, just an excel spreadsheet notation every time you make a purchase.

The following is a list of the expenses that can be claimed and even should be claimed for good Business Management. This list assumes that you are working out of your home, but can be utilized if working out of an office:

1. Computer – If you purchased a computer during the year, you can claim a major percentage of that purchase on your taxes. Determine the amount of usage between your business and your personal use and claim that percentage of the cost on you income taxes.

2. Computer usage – Any software that is used on your computer for the purpose of your internet business can be deducted. This would also include any programs or ebooks or anything of that sort. They are legitimate business expenses and can be deducted. Include a part of your internet and phone fees in that deduction.

3. Hosting and domain fees – If you have one or many domain names and they are hosted somewhere, those expenses are certainly deductible.

4. Video and other devices – A video camera used for making videos to produce and place on YouTube or somewhere else is an expense. If you subscribe to a video or telephone conferencing program for use in webinars or training of any sort, they are legitimate expenses.

5. Affiliate fees – Affiliate programs sometimes charge for signing up to promote their business.  internet businesses, in most cases, charge a monthly fee to host a website for you to introduce your program. These are tax deductable expenses.

6. Outsourcing – If you outsource anything. SEO work, article writing, building a website, or anything of this nature, you should deduct those expenses.

7. Seminars – Seminars are training and a very important part of personal development in your area of expertise. These are deductible. Hotel expenses and travel to these seminars can also be deducted.

8. Home use – Partially mentioned above, but nevertheless a legitimate use of a portion of your home can be deducted. This would include a portion of your mortgage, electric, gas, water and any other household expense can be partially deducted as an expense. You should be careful with this. You can over do some of the claims.

9. Advertising – Any form of advertising that you do is obviously a deductible expense. PPC, blog expenses, solo ads, traffic exchanges, newspaper ads, business cards and letterhead and any other form of advertising is deductible.

This is a list of many of the deductible items that should be used when submitting your income tax forms at the end of every year. The list is certainly not complete but should give you a good base to determine what is and isn’t deductible in your quest for good Business Management.

(Note) – I am not a certified tax or financial advisor. I am only giving ideas that I have successfully used in the passed but if you are going to use them, you should consult your own personal tax/financial advisor.

May 2011 and the future be prosperous for you and yours and may your tax deductions be multiple!

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