Personal Finance and Investing

Taxes generally account for the majority of a small business owner’s yearly expense. But with some important tips and tricks, you can gain control of your tax situation and put more of your hard-earned dollars back into your business. If your business structure is a sole proprietorship or partnership, you may want to consider the advantages of incorporating your business. Not only will you enjoy the benefits of limited personal liability, but corporations will generally pay less in taxes, namely the self-employment/FICA tax.

In addition to the family and personal benefits, home-based businesses also share in the benefits of lower tax obligations, so consider operating your small business from your home office.

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Every January most of us vow to improve our lives. By the end of each January most of us consider ourselves to have failed. Why? Because most ‘improvements’ – the likes of diets and gym visits – need to be worked on all year round and we just can’t keep up the momentum.

However, that’s not the case with everything – there are some simple changes to your finances you can make now that will benefit you all year.

1 Make a budget

Draw up a budget that includes all your regular bills (utilities, etc) and the less regular ones (the cost of getting your car serviced, for example). Once

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In this 2008 case, Academy Collection Service, Inc. and its owner, Keith Dickstein, paid $2.25 million to settle FTC charges that Academy collectors violated the FTC Act and the FDCPA while collecting debts, and that Dickstein failed to stop the violations.  Now they settled DOJ and FTC imposed civil penalties of $375,000 and $300,000, respectively, on officers Albert S. Bastian and Keith L. Hurt III, who oversaw Academy’s Las Vegas collection center.

The judgments were suspended upon payment of $7,500 each, based on their ability to pay. The full judgments will become due immediately if the defendants are found to have misrepresented their financial condition.

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Income shifting is quite common and is becoming more popular as married couples find ways to lower their income tax burden when making a higher-than-normal tax level.   If you are the , age 14 or older, you may want to consider income shifting as a way to alleviate some of your own federal income taxes.

Earning a high income can lead to a higher federal income tax burden on married couples.  For some couples, this tax burden can be in excess of 25%.  But, with income shifting to a teenage, couples are learning ways to transfer their post-tax funds to their children, and then writing off those same “investments” as child income when federal income taxes are filed.

Because teenagers, age 14 and older, are not subject to the same tax burdens as their parents, shifting income to your teen can become a viable way to invest in your teen’s future.   Even if your teenager withdraws the funds for personal use – say, to pay for school lunch or other expenses – the income tax bracket your teen will have on that income is usually zero to 15%.   This is a large who are looking for ways to lower their own tax burden.

If you give your kids allowance, money for entertainment, or any other funds for investing in college or other financial tools, consider talking to a financial advisor about income shifting.  In the long term, you can lower your own tax bracket while still providing for your teenager’s needs.