December, 2008

Sign on the Car=Business Mileage=Deductible?

If you put a sign on the side of the car, does it make your mileage deductible? The IRS says it’s not the sign that makes mileage deductible—it’s the underlying purpose of the trip. If you’re driving for a business purpose, the mileage is deductible. If you’re trip is personal, or commuting, the trip is NOT deductible—even if there’s a sign for your business on the car. If you include this as a deduction and get audited, you’ll loose. (The SIGN is deductible, as advertising!)

Information like this is important for business owners to know—in advance of collecting information for their tax returns. You can find this, and other necessary info, in our new book, now available on Amazon.com.

The Eightfold Path to Pay Less Tax and Avoid an Audit

Christmas is just around the corner. Perhaps you’d like to buy a copy for a friend who needs to know this stuff. Or maybe even for yourself, just to be sure you’ll be staying out of trouble with the IRS.

Here’s a link: http://www.amazon.com/Eightfold-Path-Less-Avoid-Audit/dp/0615233422/ref=sr_1_22?ie=UTF8&s=books&qid=1226611038&sr=1-22.

Eight basic things all business owners need to be masters of is ready and printed in book form, succinctly condensed into 32 pages (including a diagram on auto expenses!).

The book also contains a sections on how returns are selected for audit, when to seek professional help, and how long to keep your tax records.

Andy is also available for speaking engagements on this topic.

Preparing for the ’08 Tax Filing Season

Did you buy or sell a house in 2008?

How about a car, did you buy, sell or trade one in?

If so, please send me the paperwork on it now, so I can get started on the tax return before the crush of filing.

For a house, I’ll want to see the “Final Closing Statement” to ferret out deductible charges they’ve imbedded therein. (How’s that for a vocabulary work out!) This is usually the one with two columns of numbers from the title company.

For a car, I’ll want to see the purchase agreement—the long page with all the terms on it.

If you need a tax organizer, let us know this month and we’ll get them out to you electronically as soon as they’re available.

What is your “Safeword?”

“Safeword” – a codeword to unambiguously communicate the approach of a physical, emotional or moral boundary (per Wikipedia). I want you to give me a “safeword” to use as a default password for any files containing sensitive tax data so I can transmit them to you securely. Apparently when they wanted to break character and discuss the film in the Blair Witch Project, they’d say “taco.” I’d like something more alphanumeric like +ac0 – try to give me something where I won’t get confused between “0” and “O,” eh?

For larger files, we’ll try using www.YouSendIt.com. If we can work out the password issues, and you can use this to send files to us—for free! You should always password protect your QuickBooks files if you’re going to e-mail them.

Classes – Basic Payroll and Schedule C

In conjunction with the IRS and EDD, Andy's going to be doing some Basic Payroll seminars coming up in the near future.

Basic Payroll: Seminar runs 9 am – 3 pm with an hour for lunch

The next seminar will be
Basic Payroll in Oakland at Elihu M. Harris State Building,1515 Clay Street, Room 2, Second Floor,
December 3rd http://www.edd.ca.gov/Payroll_Tax_Seminars/Reserve_Space.asp?SemID=3137
January 28th link not yet available
February 26th link not yet available.

Basic Payroll in San Rafael is presented at 120 North Redwood Drive, 2nd floor, Redwood Room East Wing, Room E-212
February 4th link not yet available.

Basic Payroll in San Francisco is presented at the SBA office 455 Market Street, 6th floor (I take BART to Montgomery Street)
January 14th link not yet available
February 18th link not yet available.

These seminars have proven to be very popular, plus they’re free.

How to Prepare your Own Schedule C
 Prepare your business taxes for ’08 and get ready for ‘09. Review what the IRS wants to know from you and how to report it on the Schedule C for your business. This is a class for business owners who need a basic understanding of their 1040 Schedule C tax forms. We’ll also talk about what to do with the numbers once you have them. We can’t guarantee you won’t get audited, but this class will make it less likely.

Andy will be at the US Small Business Administration offices in San Francisco at 455 Market Street, 6th Floor February 25, 6-8:30 pm. This class will be free.

For relaxation and Clear Thinking Interview: On The Spot

This month I did an interview with Shoshana, owner of On The Spot, who reminds me they’re also now open just around the corner from my office in Alameda.

They are apparently more popular in the recession than they were before, as an economical alternative to getting employees their own jibber jabber. It is also a deductible business expense (get a chair massage for the whole company). This would be a green business practice and is both supportive of your employees and promotes their well-being.

Apparently, the folks over at Morgan Stanley originally thought it would be wacky and fluffy, but now they’re convinced and have become evangelists for the benefit.

We recommend meditation and that you check out On The Spot Massage at http://www.onthespotmassage.com/corporate.html to help you relax. A relaxed mind is a clear thinking mind. Makes an excellent gift for your tax preparer or other important person in your life.

Planning for a Corporation in ’09?

There is still some time left to incorporate by 1/2/09, but you’ll need the “expedited” service at this point—the Secretary of State will be overwhelmed with filings at the end of the year again this year, and if you’re not ‘expedited’ your corporation will be in the large stack of ‘when we get around to it’ that starts to build up at this time of year.

If you want to incorporate contact us today. We’ll send you an order form electronically, plus the “Little Box of Inc” booklet via the mail to help you understand what you need to know about corporations.

New Phone and Fax Numbers

We have moved our office to a shared commercial space in Alameda (the Berkeley address is still good, it is a PMB) and have new phone numbers. The old numbers still forward, but AT&T gets a fee for each call forwarded. New numbers are:
Phone (510) 522-2300
Fax (510) 522-2307