Tag Archives: business expense

Who Should Take a Home-Office Tax Deduction?

According to data compiled in tax year 2009, more than 4 million Americans claimed the home-office deduction on their tax returns. That’s about 3 percent of the total 140 million returns filed in 2010. The number is likely to increase this year, with business startup rates having increased substantially in 2011.

Kathy Pickering, executive director of the Tax Institute, research and analysis division of tax-services provider H&R Block (HRB), says the average home-office deduction is valued at more than $2,600. Yet many taxpayers are unclear about how to claim the deduction, or they worry that if they do, they’ll face an IRS audit. Pickering says that although the home-office deduction is scrutinized closely, it should be used by those who are eligible.

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Software packages and applications that can save you money

A computer is only as useful as the software you run on it, so you should keep your PC’s software current–and not necessarily with the latest version of a program that’s getting long in the tooth. Sometimes, switching to a new application can help you speed up your work or make your system more efficient.

PCWorld examined software tools for handling 11 categories of common (and essential) PC tasks: presentations, fi­­nancial planning, note taking, file management, photo editing, email, word processing, music organizing, remote access, cleanup/optimization, and backup. In each instance, we identified the dominant program, a promising challenger, and (where applicable) an online alternative. Our category coverage in­­vites you to consider the pros and cons of each type of contender: incumbents, up-and-comers, and Web apps.

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Office tenants losing leverage over landlords

If you rent space in an office building and want to move, you’d better act sooner than later.

That’s the advice of office experts who see declining vacancy rates over the next two or three years and very little new construction.

“2012 will not be the year when most landlords gain the upper hand in lease negotiations,” said research analyst Joel Warsh in his 2012 forecast from the Grubb & Ellis’ local commercial brokerage office. “Tenants, however, will see some of their leverage slip as vacancy decreases to an overall figure marginally less than 17 percent.”

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More Tax-Law Changes for 2012

Here are a few more:

  • Federal income tax-bracket  For a married couple filing a joint return, the taxable-income threshold separating the 15% bracket from the 25% bracket is $70,700 for this year, up from $69,000 for 2011.
  • The standard deduction is up slightly. For singles, the basic deduction amount for this year is $5,950, up from $5,800 last year. For married couples, it’s $11,900, up from $11,600 in 2011. There are additional amounts for those who are 65 or over, blind or both.
  • The  dependent exemption is $3,800 for 2012, up by $100 from 2011.
  • The maximum  earned income tax credit for low- and moderate-income workers and working families rose to $5,891 for 2012, from $5,751 in 2011. The maximum income limit for the EITC rose to $50,270 from $49,078 in 2011.
  • The foreign earned income exclusion  rose to $95,100 from $92,900 for 2011.
  • The IRS’s optional standard mileage rate for using your car for business remain unchanged at 55.5 cents for 2012.  Drivers have a choice of using this rate or deducting the business portion of actual expenses.

New year will bring new laws and regulations for small businesses

In California, the new rules include limits on the ability of businesses to check the credit reports of workers and job seekers. Nationwide, tax deductions for equipment purchases will be sharply reduced.

Small-business owners will be greeted Jan. 1 with dozens of new laws and regulations.

In California, they will include new mandates concerning employees, including a partial ban on checking the credit reports of workers and job applicants.

And it’s no surprise that there are changes at the federal level too.

Here’s a guide to some of the new laws and regulations set to go into effect in 2012.

  • Federal Taxes changes
  • New federal accessibility  rules
  • New California laws

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In 2011, Entrepreneurs Snag Victories in Washington

Despite the partisan bickering that kept Congress from accomplishing much in 2011, small businesses and entrepreneurs managed to eke out a few victories in Washington, D.C., this year.

1. Repeal of the 1099 paperwork requirement

2. Repeal of 3 percent withholding for government contractors

3. Small Business Innovation Research compromise

4. Startup America launched

5. Free-trade agreements passed