Small Business Tax Deduction Secrets

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Small Business Tax Deduction Secrets

Postby SeattleCPA » Mon Jul 22, 2013 8:11 am

FYI, as a publicity stunt, Amazon.com is giving away free copies of my ebook, Small Business Tax Deduction Secrets, through Friday.

Here's the page with the download:

http://www.amazon.com/Small-Business-De ... on+secrets
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Re: Small Business Tax Deduction Secrets

Postby bkslainte » Mon Jul 22, 2013 11:45 am

Thank you for this link.

I also want to thank you for all your insight/comments on other threads. I find them very useful!!
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Re: Small Business Tax Deduction Secrets

Postby neurosphere » Mon Jul 22, 2013 3:09 pm

Downloaded the book, read it all. It was very timely for me. VERY readable, I like the style a lot, and I learned a lot!

I have a question if you don't mind, regarding deductibility of startup costs which was not address in the e-book.

I currently have a side business, a non-incorporated sole practitioner with spouse as employee, doing some freelance medical writing. It showed a profit for 2012 and will do so for 2013. Suppose I want to add an additional side business doing something different. Can I deduct my exploratory costs (research, software, licensing, marketing, attorney's fees, etc) in the year they are paid even if the new business is not yet started? Because I ALREADY have a business up and running, but this would be like a new 'division', and it would be set up in the same way (non-incorporated, sole practitioner). In my mind, I would have a business selling two different kinds of service. Or would this count as a new, unrelated business, subject to new rules about when I can deduct the startup costs? The startup costs would not be substantial, and hopefully would be less than $5000.

It would be to my advantage to deduct them in 2013 as a continuation of the existing business, because my income is going to drop significantly in 2014. But I may not have this "second" business up and running by the end of the year.

I hope my question makes sense.

Thanks, NS
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Re: Small Business Tax Deduction Secrets

Postby SeattleCPA » Mon Jul 22, 2013 3:52 pm

neurosphere wrote:Downloaded the book, read it all. It was very timely for me. VERY readable, I like the style a lot, and I learned a lot!

I have a question if you don't mind, regarding deductibility of startup costs which was not address in the e-book.

I currently have a side business, a non-incorporated sole practitioner with spouse as employee, doing some freelance medical writing. It showed a profit for 2012 and will do so for 2013. Suppose I want to add an additional side business doing something different. Can I deduct my exploratory costs (research, software, licensing, marketing, attorney's fees, etc) in the year they are paid even if the new business is not yet started? <snip>


That's a good question. And here's what I think (though we'll maybe see if some other CPAs weigh in with other ideas)...

I think because you're a sole proprietorship that you're often pretty limited. You'd need to file a Schedule C for each business according to this instruction in the Schedule C guidelines, "If you owned more than one business, you must complete a separate Schedule C for each business"...

That means, IMHO, that your second sideline business potentially gets entangled in the startup expenditures rule if second venture can't be described as being part of the first business's activity.

However, that said, I would also guess that in many cases one might be able to treat both businesses as the same one. E.g., you probably can't combine a writing business with some other ventures that's *totally different* like gem mining.

But I also think you can combine stuff in many logical ways. E.g., a writing business and an editing business could be combined in my mind as a publishing or content business that provides writing and editing services. Or a writing business (where maybe you're partially writing content for websites) could maybe be combined with a informational website that's also about content and web publishing, etc.

Hope that helps. I think you're right that you want to look at ways to use the first business to provide relief from the second business's startup expenditure limitions. And you might be able to create a business activity definition that includes both your first "product" or "service" and also your second product or service. :)

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Re: Small Business Tax Deduction Secrets

Postby matjen » Mon Jul 22, 2013 3:57 pm

Thank you! Just ordered it and looking forward to reading it.
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Re: Small Business Tax Deduction Secrets

Postby Calm Man » Mon Jul 22, 2013 6:03 pm

I don't have a kindle account yet and am avoiding until I complete my 50 or so remaining hard copy books. Is there a way to get a pdf of this?
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Re: Small Business Tax Deduction Secrets

Postby neurosphere » Mon Jul 22, 2013 6:07 pm

Calm Man wrote:I don't have a kindle account yet and am avoiding until I complete my 50 or so remaining hard copy books. Is there a way to get a pdf of this?


If you have an android phone or tablet and an amazon account you can read it after downloading android kindle app.
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Re: Small Business Tax Deduction Secrets

Postby ObliviousInvestor » Mon Jul 22, 2013 6:17 pm

Thanks for the heads-up, Stephen.

bkslainte wrote:I also want to thank you for all your insight/comments on other threads. I find them very useful!!

Ditto this.

Calm Man wrote:I don't have a kindle account yet and am avoiding until I complete my 50 or so remaining hard copy books. Is there a way to get a pdf of this?

You don't need a special account, just a normal Amazon account.

You can download the book now, then read it later on a normal PC or Mac:
Kindle for PC
Kindle for Mac
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Re: Small Business Tax Deduction Secrets

Postby JW Nearly Retired » Mon Jul 22, 2013 8:14 pm

SeattleCPA wrote:FYI, as a publicity stunt, Amazon.com is giving away free copies of my ebook, Small Business Tax Deduction Secrets, through Friday.

Here's the page with the download:

http://www.amazon.com/Small-Business-De ... on+secrets

thanks, I grabbed it.
Retired Summer 2013
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Re: Small Business Tax Deduction Secrets

Postby SeattleCPA » Tue Jul 23, 2013 12:24 pm

Dear bkslainte, neurosphere, calm man, matjen, ObliviousInvestor and JW Nearly Retired,

You are very welcome... and thank you for kind words.
:happy
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Re: Small Business Tax Deduction Secrets

Postby Frugal Al » Tue Jul 23, 2013 1:14 pm

Yes, thanks for the book, Steve. However, I have to say, the title now forces me to reconsider your credibility. :wink:
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Re: Small Business Tax Deduction Secrets

Postby SeattleCPA » Wed Jul 24, 2013 8:00 am

Frugal Al wrote:Yes, thanks for the book, Steve. However, I have to say, the title now forces me to reconsider your credibility. :wink:


Book titles are always a little funny... I remember (as an early "... For Dummies" author) how strongly lots of people reacted to the word "Dummies" in the title.

The "Small Business Tax Deduction Secrets" title, for what it's worth, wasn't originally a "title" for human readers... it was for the search engine spiders. I.e., in the past with ebooks sold off of websites, you wanted keyword stuffed titles so the pages that promoted the ebook ranked well.

In any case, hopefully even if the title puts you off you'll find the material in the book useful. :D

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Re: Small Business Tax Deduction Secrets

Postby Code Commit » Wed Jul 24, 2013 9:46 am

Thank you, Steve for the heads-up. I also like your blog and small business FAQ a lot. Thanks for your contribution.
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Re: Small Business Tax Deduction Secrets

Postby SeattleCPA » Thu Jul 25, 2013 11:30 am

Code Commit wrote:Thank you, Steve for the heads-up. I also like your blog and small business FAQ a lot. Thanks for your contribution.

'
Code Commit, thank your for kind words and feedback on blog. :happy
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Re: Small Business Tax Deduction Secrets

Postby vtjon » Thu Jul 25, 2013 12:16 pm

I'm curious how this works as an author. Does the author still get royalties when Amazon lists it as free? I suspect not so did Amazon contact you to ask your permissions?
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Re: Small Business Tax Deduction Secrets

Postby SeattleCPA » Thu Jul 25, 2013 1:59 pm

vtjon wrote:I'm curious how this works as an author. Does the author still get royalties when Amazon lists it as free? I suspect not so did Amazon contact you to ask your permissions?


I don't really know what happens when you do this. You don't btw get any royalties. But lots of people who seem pretty smart do it (including Mr. Mike Piper, aka ObliviousInvestor)... so I thought it'd be an interesting experiment.

Er, I may feel very foolish in a few weeks. :oops: (We've previously sold the book for $37.95 and per the amazon.com kindle select agreement, they get exclusive rights to the book for 90 days. So I know I'm at least losing that revenue by letting amazon give away.)

Oh, also, you do when you sign up with amazon.com for this check boxes that, e.g., let them give it away free for five days, include book in their lending library and amazon prime thingy..

Again, though, I no basically nothing about this. I just did it for the learning.
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Re: Small Business Tax Deduction Secrets

Postby ObliviousInvestor » Thu Jul 25, 2013 2:05 pm

vtjon wrote:I'm curious how this works as an author. Does the author still get royalties when Amazon lists it as free? I suspect not so did Amazon contact you to ask your permissions?

The author/publisher does not get royalties when somebody downloads the book during one of the promotional periods.

The author/publish does get a small royalty (roughly $2 -- varies from month to month) when somebody "borrows" one of their books via the Kindle Lending Library (for Prime users).

Both of these programs are optional though. It's not as if Amazon will suddenly make your book available for free, without your permission, and not pay you anything for it. :-)
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