Tuesday, October 28, 2008

Joe the Plumber Gets More Tax Breaks Than Me

So, in talking with my favorite tax professional, Dean Brand of Comprehensive Business Services (Delaware), I found out that Joe the Plumber isn't hurting all that much. Did you know that small businesses are eligible for nearly 1600 federal tax deductions, while an individual has less than 100 deductions that they might be able to take? Seems a little unfair to me.

Here's what I found out: you know, that cupcake business you have on the side, or those little crafts you make and sell for some extra spending money? Well, you aren't taking advantage of all that the federal government offers you unless you are incorporated - not operating as a sole proprietor. A sole proprietor has to pay taxes on that extra income - no matter how small it is; and you can only take up to 100 deductions, most of which are related to being a homeowner.

Whereas, if you spend a couple hundred dollars or less to incorporate you can possibly be eligible for hundreds more. Do the math. Makes sense to me, which is why I have already incorporated Bastille Marketing. Not that I am doing much business on a freelance basis, but for even what little I do, I want to be sure that I maximize every penny. Would you walk away from a free $100 or more?? I wouldn't. But if you aren't taking full advantage of the tax deductions out there, then you are.

What's the best part? Dean makes the incorporation process as painless as possible, you get a super organized notebook back with all of your incorporation documentation (I love organization) along with a seal of your company's name (!), straight talk for the average person (not a bunch of tax geek mumbo jumbo, or financial latin that you need to pay a translator to understand) and when its time - Comprehensive Business Services will do your taxes too!!!! That's my favorite part. If you have payroll to deal with or other sorts of book-keeping, they do that as well. Basically, I dig this company because its totally turn-key.

Full disclosure: Dean is also my fiance, although, having had the pleasure of working out of their offices last Friday, I can certify that I didn't get special treatment - this is how they treat all of their clients!! What are you waiting for? The tax year ends in only two months...

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