Home based business and why you should have one (NOW!!), if not years ago.
Congress on your side?
While you may think this heading is a misprint, it is not. Congress is actually doing what benefits them and the country and it just so happens, that this time, you can reap the rewards. Congress did not unintentionally create a loophole so you can lower your taxes, it was quite purposeful for two objectives:
1. Stimulate the economy through small business
According to the U.S. Small Business Administration, small businesses accounted for 63 percent of net new jobs between 2010 and 2016. They comprise 99.9 percent of all firms and employ 47.8 percent of all private sector workers. That means that nearly half of employment is through small business, and when the Government wants to incentives the nation to do things, they offer tax cuts/reductions for it. Buy a low emissions car (tax break), solar power for home (tax break), start a home based business (tax break).
2. An active small business in economic downturns
There should be not doubt that economy our runs in waves in which there are up times and down. The question is, how do you survive in a down economy? Typically big business will lay people off or fire them in a down economy due to lack of demand resulting in less revenue and profits. As you are a liability on a jobs spreadsheet, this means that you have to go. The tax break is to encourage everyone to have and run an active home based small business as a safety net in these down times.
One country, two tax systems!! You can choose which system(s) to be in.
W-2 system - The employee that gets up everyday and goes to their job and gets on the clock. The are subject to the operating procedures and policies in place by their job. Many employees live in "right to work" states that will allow them to be fired without cause, at the whim of those that are in charge. It allows for tax deductions for IRA, 401K, mortgage interest, charity, and property tax.
Home based and small business system - Here you move into the category of owner/employer rather than employee. You can work your business part time, yet still receive "full time" tax benefits. What are the chances of you firing or laying yourself off in your home based business? In addition to the tax deductions available to employees in the W-2 system, you can also deduct housing, wages to kids, vacations (business), vehicle, entertainment and more.
I submit to you this thought, "take home $15,000 or $21,000"?
$15,000(example) - A person working in the W-2 system that makes $50,000 gross will be taxed on the $50,000. Assuming 30% tax ($15,000), that will leave them with $35,000 ($50,000 - $15,000). Taking a conservative number for spending (child care, rent/mortgage, vehicle payment, electric, gas, water, trash, etc...) many will have around $20,000 in spending, leaving them with $15,000 actual take home pay.
$21,000(example) - A person working in the W-2 system along with a homes based business that makes $50,000 gross will have their spending of the same $20,000 first on the $50,000. That will leave them with $30,000 ($50,000 - $20,000). Assuming the same tax bracket of 30% ($9,000), that leaves them with an actual take home pay of $21,000.
You actually get to choose which take home pay you want!!
Here is the question I so often ask of people on issues like this, "Why would you push for something against your own interest?" It seems to run afoul of every instinct of self preservation and self help, yet the longer I live, the more I see it. They will curse the tax system and swear the system is rigged for the very few. However, as I present the opportunity for them to become the very few using the tax system to build wealth, they are closed to the thought of it. In the examples above, I am speaking of the over 100 million people choosing $15,000 instead of $21,000; to that I ask again, "Why would you push for something against your own interest?"
You're ready to take back your money to put it to work for you or will you continue to be among the 100+ million to fight against your own interest? When you subscribe below, you will get the fully detailed rundown of the strategy, not a high level overview. On the other hand, if you're ready to start getting your money back and use my strategy to build your financial success, just click start the strategy. The cost is $34.95 to start, then 30 days later, $34.95 per month. That is $34.95/month for a strategy to save you thousands/year!!
Until next time, "Be your own boss and take control of your financial destiny. Where you go from here is always up to you" - Personal Economy Coach- Robert Skipper
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