Preparing for taxes
Even though you haven't yet received your W-2's and 1099's, it's time to start preparing for income taxes. If you're nervous about taxes and your records are not together, put yourself at ease by getting organized.
What should you do? In addition to various 1099's, W-2's and year-end interest statements, you need to gather your business income and expense records together. Here is what information you're going to need.
Time is Our Biggest Asset
Many Owner-Operators were fleet drivers before they bought a truck. Fleet drivers quickly figure out how to get the time-off that they want, and to get it without significant penalties.
But when the Fleet driver becomes an owner-operator, the old fleet driver habits about time-off should change with the new responsibilities.
Independent Contractor Classification
Worker classification is currently a top audit target of the IRS. Many of you are concerned as to whether your workers are employees or independent contractors. It is important to have them properly classified and that classification can determine whether you need to pay employment taxes or provide health insurance and retirement plans.
Many businesses would rather pay independent contractors than employees to avoid paying payroll taxes and fringe benefits. In fact, many people would rather be independent contractors in order to take advantage of some tax advantages. It can be a win-win situation.
Be aware that the self-employed have always been a favorite audit target of the IRS. The IRS tends to audit those tax returns with the potential for the biggest payoff.
Hence, the self-employed are more closely scrutinized than any other group, so be prepared to backup your business expenses.
20 sneaky credit card tricks
Credit card companies can be as slippery as a handful of greased Jell-O. They have all kinds of tricks to gouge your wallet and drive up your bill. While arguably unfair, all these tricks are legal, leaving you no alternative but to stay as informed as possible to protect yourself.
Read your statement, report any irregularities immediately and watch for these 20 sneaky credit card company tricks. Start saving on fees now.
Tax tips and tax planning
One of the tools the IRS uses for determining what returns are to be audited is the matching process. The IRS is matching W-2's and 1099's to the income tax returns and additionally they are matching K-1's from pass through entities such as S-corporations and partnerships.
Tax returns are being audited a year or two after they are filed. Therefore, taxpayers should manage their tax planning now for the growing audit risk they can expect to face in the years to come.
Starting a business
Experience and knowledge of your industry is crucial. If you don't have any experience, consider working with a successful owner-operator for at least six months.
Do as much research as possible. The time you spend gathering accurate information is going to be well worth the effort. The more information you have the less likely you are of making poor business choices and costly mistakes.
A closer look at "Successful Trucking"
"Over the years, when talking to our trucking customers, we were constantly being asked "is there a book that I can buy that explains my income tax requirements, bookkeeping requirements, etc.?"
"There was nothing that was trucking-focused that we had heard of, so we felt there was a real need for this book. We wanted to put something together that was part business guide, part resource manual." - co-author Shasta May.
Smart Investments - Part I
PBS has specialized in trucking for over 25 years and their knowledge and experience will work for you. They share these smart tips on investing.
A nice mix of investments would include real estate, cash, mutual funds, bonds, hedge funds, index funds (or I-shares) and stocks; let's see if we can define the different types of investments. Remember, the greater the potential return on an investment (profit), the greater the risk.
Mid-Year Tax Planning
As most of you already know, contributing to a retirement plan is one of the best ways to keep more of what you earn. Money invested in retirement accounts can grow faster than other investments because earnings are not taxed until you withdraw the money.
There are plenty of retirement saving plans to choose from and thanks to increases in the contribution limits, you can put away more than ever before. Here are some options.