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    You are here: Build Your Business : Articles : Tax Strategies

    Uncle Sam Wants YOU to Start a Business
    By Sharon Lechter
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    A lot has been said about the many advantages of starting your own business. Let's start with the tax incentives. It's no secret to anyone that the tax laws are written to promote business ownership. So do what the rich do. Start your own business and take advantage of the favorable tax advantages that come with owning a business.

    Build First, Pay Taxes Last
    The difference between the employee and the business owner is that the employee pays taxes FIRST on what they earn and then gets to live on whatever is left over. The business owner spends their earnings to build their business FIRST and then pays taxes on what is left.

    The business owner will always pay less tax than the employee simply because they can reduce the income amount they have to pay tax on. This enables the business owner to grow their business faster and for the business to generate investment dollars quicker.

    Tax Advantages of a Home-Based Business
    To take advantage of these deductions, the tax code states that these expenses need to be only "ordinary and necessary", and that your business needs to be one in which you are endeavoring to make a profit.

    Here are some of the other business deductions you may be able to take advantage of:

    • Home office expenses (repair, maintenance, property taxes)
    • Business equipment (computers, cell phones)
    • Office supplies
    • Internet and telephone services
    • Software and subscriptions
    • Mileage and other auto expenses
    • Travel, meals and entertainment

    Proper Documentation a Must
    Don't be afraid to take advantage of these deductions. As long as your expenses follow the tax code guidelines and you retain proper documentation to back-up the expenses, you will be protected in the rare case of an audit.



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    Reproduced with permission from RichDad.com

    ABOUT THE AUTHOR:

    A life-long education advocate, Sharon Lechter is co-author of the international best-selling book Rich Dad Poor Dad and the Rich Dad series of books as well as one of the founders of The Rich Dad Company. She is a CPA, entrepreneur, philanthropist, educator, international speaker, and Mom.

    She has been a pioneer in developing new technologies to bring education into children's lives in ways that are innovative, challenging and fun and remains committed to education – most especially, financial literacy.

    "Our current educational system has not been able to keep pace with the global and technological changes in the world today," Sharon states. "We must teach our young people the skills – both scholastic and financial – that they need to not only survive but to flourish in the world."

    The Rich Dad Company has grown into an international powerhouse with over 20 books, board games, website, CDs, audio cassettes, seminars, and coaching services. Rich Dad Poor Dad has been on The New York Times Bestseller List for over 5 years and is available in over 44 languages and sold in more than 80 countries.

    Sharon’s speaking topics range from educating children and adults on taking control of their personal finances to the entrepreneurial business strategies she used in building Rich Dad’s international success. She shares the spectacular history of this mega-hit and how Rich Dad Poor Dad was originally designed to be only a brochure for their CASHFLOW board game.

    A committed philanthropist, Sharon also gives back to the world communities as both a volunteer and a benefactor. She directs the Foundation for Financial Literacy, is an active member of Women’s Presidents Organization, and serves on the national board of Childhelp USA, a national organization founded to eradicate child abuse in the United States. In 2002, Childhelp honored Sharon and her husband, Michael, as recipients of that organization’s "Spirit of the Children" Award. In 2004, Sharon and Michael were recognized as an Arizona “Power Couple”. Sharon was just named as a 2005 Woman of Distinction by the Crohn’s & Colitis Foundation of America.

    Sharon’s co-author, business partner and friend, Robert Kiyosaki, says "Sharon is one of the few natural entrepreneurs I have ever met. My respect for her continues to grow every day that we work together."


    Related Articles Search Results
  • Uncle Sam Wants YOU to Start a Business

  • Tax Fears and Facts

  • Reducing Taxes - The Old Tricks Still Work!

  • Investment Tax Advice... Five Moves to Make Now

  • << prev next >>


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