Tax Advantages of Owning Your Ambit Business

Checkout this Interview with Sandy Botkins, CPA & Tax Attorney, talk about the Tax Advantages of a work-at-home business.

In our Ambit Business Presentation we touch on the Tax Benefits you receive by being an Independent Marketing Consultant with Ambit. You are already spending most of your income on your children, home, medical, expenses, vehicles and vacations. Wouldn't it be nice to start keeping $500 or $600 of that money each month?

Within the last couple decades Congress has made very generous tax benefits available to home business owners (i.e. Ambit Energy Independent Marketing Consultants). The design is to stimulate economic growth. The deductions are incentives. All that is asked in return is "documentation" that clearly establishes a business owner's (YOU) intent, by proving the "pursuit of profit." This means that there is a well-defined responsibility on the part of business owners (YOU) for the thousands of dollars they save. Congressmen understand that it takes time to get a new business off the ground. So the regulations are written in such a way that even if no profit is made, the "pursuit" makes the deductions legal and in good standing.

Of the 138 Congressional mandated tax benefits now available to the home business owner (YOU), there are six that represent the greatest value for the effort. Below I have covered them. As you evaluate these deductions, keep in mind that they can result in $20,000 - $40,000 in tax write-offs, easily totaling $5,000 - $15,000 in cash savings! 

 

Tax Benefit #1

CAPITAL EQUIPMENT:

Did you know that now that you're an Independent Marketing Consultant this IRS code allows small business owners, like you and I, up to $500,000 in deductions on purchases of capital equipment; including office furniture, office equipment and autos (qualifying vans, pickups and SUV's) in the same year of the purchase. This means you can write off the full depreciation amount on these items the same year they are obtained, whether they are paid for in full or financed.

IRS code, Section 179, 2011

 

Tax Benefit #2

MEDICAL EXPENSES:

Did you know as an Independent Marketing Consultant you can deduct 100% of all medical expenses? That includes medical insurance premiums (even if they are for insurance provided by your full-time employer!), office visits and co-pays, pharmaceuticals, dental and ophthalmology expenses. This benefit pays off to the tune of approximately $2,500 a year per family. Currently, only 1% of those who qualify are taking advantage of it!

IRS Code, Section 105, 2001

 

Tax Benefit #3

HIRING CHILDREN:

Did you know as an Independent Marketing Consultant you can hire your children and pay them up to $7,700 ($4,700 wages + $3,000 IRA) per child, per year and you can that to all children over the age of 7 who work in the family's Ambit Business? The entire amount is considered a business expense and there is no income or Social Security tax due from the child, if he or she is under the age of 18. You can pay each of your children $4,700 a year and have them purchase their own clothes and toys, college and weddings from the tax savings from your day job paycheck. Pay Uncle Sam or pay your children. It's YOUR money and it's the same money!

IRS Code, Section 63(c), 162(a) (l), Pub. 15-Sec. 3, 2002

 

Tax Benefit #4

HOME OFFICE:

Did you know as an Independent Marketing Consultant you owner can write off any room or portion of the residence as a business expense. The average amount claimed for this deduction is $2,400 per year. Unfortunately, only 10% of qualifying filers are taking advantage of this major tax benefit.

IRS Code, Section 280A, 2001

 

Tax Benefit #5

VACATIONS/BUSINESS TRIPS:

Did you know as an Independent Marketing Consultant your vacations can be combined with business trips to make most of your travel costs tax deductible? Proper qualification and documentation is required, but a little planning and record keeping can save you hundreds of dollars.

IRS Code, Section 162 (a) (2), Reg. 1.162-2, 2001

 

Tax Benefit #6

BUSINESS MILEAGE:

Did you know as an Independent Marketing Consultant there is a 55.5-cent deduction for every business mile you document? You can convert commuting miles into business miles by performing tasks for your Ambit Business, on your way to and from your day job. There are many qualifying taxpayers that don't utilize this worthwhile strategy. Imagine! It's like throwing a dollar bill out the window every three miles!

Tres. Reg. 1.162-l (a), 2011

 

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