The Tax Preparation Blog

Archive for February, 2008

The Internal Revenue Service reminds all home based business operators to follow appropriate guidelines when determining whether an activity is a home based business or a hobby, an activity not engaged in for profit.

In order to educate taxpayers regarding their filing obligations, the IRS guidelines explain the rules for determining if The Savings Highway qualifies as a business and what limitations apply if the activity is not a business. Incorrect deduction of hobby expenses account for a portion of the overstated adjustments, deductions, exemptions and credits that add up to $30 billion per year in unpaid taxes, according to IRS estimates.

In general, taxpayers may deduct ordinary and necessary expenses for conducting a Savings Highway business. An ordinary expense is an expense that is common and accepted in the taxpayer’s trade or business. A necessary expense is one that is appropriate for the business. Generally, an activity qualifies as a business if it is carried on with the reasonable expectation of earning a profit.

Auditors are being told to use several tests to determine if your “activity” is really a “hobby” or a “business.” Hobbies get a few tax breaks, but home-business owners get substantianly more!

If they can reclassify you as a hobby, the IRS gets more of your money.

IMPORTANT: As A Savings Highway representative. One of the tests that is not well understood, has to do with how much time you spend on the activity.

You need to prove “Material Participation” in your Savings Highway opportunity. Here are seven ways to prove you qualify for the tax savings:

1: If you work your business at least 500 hours per year. Tax Savings Allowed

2. If you work your business at least 100 hours per year AND no one else working in your business puts in more time than you do.Tax Savings Allowed

3. The taxpayer does substantially all the work in the activity.Tax Savings Allowed

4. The activity is a significant participation activity (SPA), and the sum of SPAs in which the taxpayer works 100-500 hours exceeds 500 hours for the year.Tax Savings Allowed

5. The taxpayer materially participated in the activity in any 5 of the prior 10 years.Tax Savings Allowed

6. The activity is a personal service activity and the taxpayer materially participated in that activity in any 3 prior years.Tax Savings Allowed

7. Based on all of the facts and circumstances, the taxpayer participates in the activity on a regular, continuous, and substantial basis during such year. However, this test only applies if the taxpayer works at least 100 hours in the activity, no one else works more hours than the taxpayer in the activity, and no one else receives compensation for managing the activity.Tax Savings Allowed

In order to determine wether the Savings Highway is a qualified home based business or hobby, taxpayers should consider the following factors:

* Does the time and effort put into the activity indicate an intention to make a profit?

* Does the taxpayer depend on income from the activity?

* If there are losses, are they due to circumstances beyond the taxpayer’s control or did they occur in the start-up phase of the business?

* Has the taxpayer changed methods of operation to improve profitability?

* Does the taxpayer or his/her advisors have the knowledge needed to carry on the activity as a successful business?

* Has the taxpayer made a profit in similar activities in the past?

* Does the activity make a profit in some years?

* Can the taxpayer expect to make a profit in the future from the appreciation of assets used in the activity?

The IRS presumes that an home based business is carried on for profit if it makes a profit during at least three of the last five tax years, including the current year — at least two of the last seven years for activities that consist primarily of breeding, showing, training or racing horses.

If an activity is not for profit, losses from that activity may not be used to offset other income. An activity produces a loss when related expenses exceed income. The limit on not-for-profit losses applies to individuals, partnerships, estates, trusts, and S corporations. It does not apply to corporations other than S corporations.

Tax savings for hobby activities are claimed as itemized deductions on Schedule A (Form 1040). These deductions must be taken in the following order and only to the extent stated in each of three categories:

* Tax savings that a taxpayer may take for personal as well as home based business activities, such as home mortgage interest and taxes, may be taken in full.

* Tax savings that don’t result in an adjustment to basis, such as advertising, insurance premiums and wages, may be taken next, to the extent gross income for the activity is more than the deductions from the first category.

* Tax savings that reduce the basis of property, such as depreciation and amortization, are taken last, but only to the extent gross income for the activity is more than the deductions taken in the first two categories.

As you can see from the guidelines established by the IRS qualifying as a legitimate home based business such as The Savings Highway are extremely straight forward. (Work at your business opportunity for 100 hours a year, and intend to make a profit). Turn your everyday activities (Eating and Driving) into substantial tax savings when you join the Savings Highway today.

Contact Me:

Jim Roche NJ

(908)413-5363

New Tax Guide Features Recovery Tax Breaks

Taxpayers can get the most out of new recovery tax breaks and get a jump on preparing their 2009 federal income tax returns by consulting a newly revised comprehensive tax guide now available on IRS.gov.

A need for Columbia self-storage may arise while relocating or if you have excess furniture items and do not know what to do with them. It can also be useful for storing valuables and collectibles like jewelry, artwork, craftwork, woodcraft and the like. Here, we share some of the benefits of self storage units and their utility. Read on to learn more about how you can benefit from these services.

Benefits

* Peace of mind – This is the most important part of self storage units. Storing your things in them gives you peace of mind as you don’t have to worry about your belongings. They will be safeguarded by the high safety and security measures. So, there is no fear of loss or damage due to theft, natural calamities like earthquake, storms, floods, fire and so on. The Columbia storage units are equipped with state of the art technology to fight such extreme conditions. The unit is architecturally designed in a special manner with safety feature in mind. Moreover, the material used for constructing a storage building is different from the ordinary construction material. This ensures that the facility is able to withstand tough weather conditions and natural calamities. You can live in peace and safe keep your valuables or other furniture items.

* Increase the life of your belongings – Good storing condition will increase the life of your belongings. When the articles are stored properly and guarded against extreme weather conditions, they remain as it is. For instance, if you keep paper craft or wooden craftwork at home, it may be prone to degradation and wither after a few years. However, if you keep such items in a climate-controlled Columbia self storage unit, it will stay forever. These units are designed specially and do not collect dust. Moreover, the outside temperature does not affect the articles since the humidity level in controlled in such units. Some units will also allow you to store wine. The items do not even require any maintenance; the temperature control system takes care of the items.

* Additional services – Apart from storing your belongings the Columbia storage service providers also offer additional facilities. For instance, they also offer packing and moving services at discounted rates if you hire a unit with them. Professional packers and movers may charge a huge amount for these services. The storing company offers other benefits like insurance too.

* Innovative storage needs – Columbia self storage offers innovative services like, shipping, copy and fax services, mailbox rentals, car storage, boat storage and RV storage.

Such are the benefits of self storage units. Look for these features while hiring a facility. You can also look for good customer service, type and size of unit, location, charges, and safety and security measures and so on. These factors too will make a huge difference to your experience. In fact, poor customer service and lack of access to the unit 24 X 7 is a deterrent. Make the right choice and hire the best Columbia self storage units.

Hartsville Happenings

Hartsville Area Happenings

Desktop Alert, Inc. the leading provider of IP-Based mass notification technology to the United States Army, today announced the company has been selected by Fort Leavenworth of the United States Army as their primary network-based mass notification platform of choice .

The alerts appear as pre-defined or on-the-fly pop-up windows which force immediate attention to workstation receiving the message with instructions for the action(s) to be taken. A video, audio, image and/or verbal alert automatically sound/appear over the computer’s monitor and speakers. Alerts are received base-wide within an average of one minute after the alert is sent.

The Fort Leavenworth mission; as the Combined Arms Center (CAC) states, is “organized to support both an Army and nation at war and to develop the future force. In its principal role, CAC provides leadership and supervision for leader development and professional military and civilian education; institutional and collective training; functional training; training support; battle command; doctrine; and lessons learned. The CAC also serves as a catalyst for change in specified areas the commanding general, Training and Doctrine Command (TRADOC), designates to sustain the development of relevant-and-ready expeditionary land formations with campaign qualities in support of the joint force commander.”

“Desktop Alert considers it an honor and privilege to work with an organization known as ‘The Intellectual Center of the Army’ that has supported our nation for over 170 years. We look forward to integrating with not just the technical environment, but also becoming part of the community at Fort Leavenworth.” said Desktop Alert President David Zadick.

“Fort Leavenworth is considered as one of the most significant historic military installations in the Department of the Army, as well as to the nation. Looking forward, community continuity with facilities on unclassified networks will be a significant part of our companies’ strategic planning and future growth, “said Desktop Alert CEO and Founder Howard Ryan. “The United States Military Academy at West Point, Fort Leonard Wood, Fort Campbell, USAG Heidelberg, Fort Leavenworth and others are perfect examples of customers who are surrounded by hospitals, schools, fire departments and other facilities which require comprehensive emergency management and business continuity information. Desktop Alert is uniquely equipped in providing Secure Mass Notification Systems (SMNS) along with its partner Protexx with Identity Access Management and Multi-Factor Authentication security specializing in Data-in-Motion and Remote Authentication over any network or wireless environment. The joint solution delivers to unclassified networks the protection they need for total peace of mind as they communicate. “

Desktop Alert provides Fort Leavenworth the Total Alert Solution utilizing network-centric emergency notification technology to provide base-wide emergency notification using the existing Internet Protocol (IP) network and IT infrastructure.

Schwarzenegger declares budget emergency, proposes deep cuts

Gov. Arnold Schwarzenegger unveiled an $82.9 billion state spending plan today that calls for no tax hikes but envisions pay cuts for state workers, reductions in services to California’s neediest residents – and relies on the benevolence of the federal government.

Bass Questions Plan For Tax Breaks

Question: why are some people getting their stimulus checks early?

here’s the schedule:

Last two SSN digits:

00 through 09 May 16
10 through 18 May 23
19 through 25 May 30
26 through 38 June 6
39 through 51 June 13
52 through 63 June 20
64 through 75 June 27
76 through 87 July 4
88 through 99 July 11

a friend of mine has the last two digits of 59…he got his check in the mail last week….why?

and i also wanted to know what having your tax refund preparation fee deducted from ur tax refund check has to do with any sort of delay in receiving the stimulus check?

i filed my taxes in january and got my refund that same month…my refund was broken up..half the next day and half two weeks later…

People who file a return after
i never used direct deposit…i received paper checks when i got my tax refund
and my last two are 29

Answer: people who filed early…electronically……and w/ direct dep. were said to be 1st……starting may 1st……..

Council reverses stance on golf cart trail fees

During a special meeting Wednesday night the Nevada City Council voted 3-2 before a council chamber full of vocal golfers to reverse their stance on private carts for the current year by voting 3-2 to pass on first reading an amended bill that will keep the trail fee for private carts the same for 2010, while adding several new programs.

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