Hello everyone and thanks for joining us today. My name is Phyllis Wischer and I am the Lead Business Coach at SageFire, Inc. - the creators of KeepMore.net. I am a Public Accountant with over 20 years experience in helping thousands of small business owners with their bookkeeping accounting and tax needs.

SageFire is a Certified Solution Provider specializing in helping small business owners' track their business financial activity using our online accounting, contact management and document storage solution. Our solution, KeepMore.net makes it simple for you track your business while maximizing your tax benefits.

Don't you think it's time to keep more of your hard earned income? We do; and I want to show you how starting early, being organized, and using a tool like KeepMore.net can help! During today's session I will cover two different topics to help you get ready for tax season.

• Getting your records ready to file your business tax return




• Due Dates of returns


• Requirement to file any additional tax forms


• Review your records to be sure you have recorded everything


• Other things to consider regarding your business income and expenses




• Getting your records ready to file your personal tax return




• Things to consider regarding your personal income tax return


• A tax organizer to get you 'organized'

Reviewing your records and starting the process today will definitely help you in keeping more of your hard earned income in your pocket.

We are not here to provide tax advice; however, we would like to give you some basic information about your income tax returns. For the maximum tax benefit, we recommend that you consult with your tax advisor before the end of year.

By this time you should have all your income, expenses, assets and mileage through November 2006 recorded in a simple record tracking tool like KeepMore.net. You should now review your expenses to be sure that you have recorded all your deductible expenses. Look for the following.

• 11 months of recurring expenses like office rent, telephone, cell phone, equipment leases and payments, and other business expenses that recur monthly


• review your day planner and records for any missed deductible business mileage including any mileage driven by your spouse for business purposes




• At the current IRS Standard Mileage Rate of $.445, for every two unrecorded miles you drive you are throwing away $1.00


• At the 2007 IRS Standard Mileage Rate of $.485, for every two unrecorded miles you drive you are throwing away over $1.00




• Be sure to do bank and credit card reconciliations to be sure that you have not missed any business deductions - this also helps you make sure there have been no errors by your bank or credit card company

Now you are ready to make an appointment with your tax advisor to maximize the benefit of tax planning before the end of the year.

Inventory is a different story. Most small business owners fall under the rule that you do not have to report income and expenses on an accrual basis. However, it is important to remember that you cannot deduct the cost of inventory still sitting on your shelves on 12/31/06.

Since this is a very important rule - I would like to give you an example.

John Smith is a sole-proprietor specializing in selling the new 'mini-widget' on eBay. On December 12, 2006, he realizes that he has a $25,000 net profit and calculates income tax due of $7,500 (assuming self-employment tax and federal income tax in a 30% tax bracket). John determines that he is out of 'mini-widgets' and decides to take $10,000 of his cash and purchase additional 'mini-widgets' to sell during the remainder of this year and into next year. He calculates this will save him $3,000 in taxes. But are his calculations correct?

Now, let's discuss getting your personal records ready for income tax purposes. Here are a few things to consider before the end of the year.

• Pay Yourself First - if cash flow allows, maximize your pension funding. Everyone wants to know the best tax benefit available to the average taxpayer - THIS IS IT!


• Itemize your deductions - according to an IRS investigation, many taxpayers do not take the time to itemize their allowable deductions. The IRS estimates that the overpayment of tax (due from failure to itemize) has exceeded half a billion dollars - and this study was done two years ago.


• Sell or give away what you’re not using – clean out your closets, storage sheds, and garages. Do some research on eBay and determine if you can make some money by selling your items. If you don’t feel there is value there, and if you itemize then donate those items to your favorite charity. Make a detailed list of the donated items for your tax records. There is some very inexpensive software available that you can use to list and value your donated property – use your favorite search tool and look under ‘value of donated property’.


• Prior year's tax records - be sure to carry forward of any allowable deductions from the prior year's tax return. This would include (but limited to) capital losses, net operating losses, mortgage points, home-office costs, depreciation, large donations or real estate losses.




It's time to get your records organized - don't miss recording any income or allowable deductions because you are not organized. We have an income tax organizer available for you to use to get your tax information ready for your accountant. You may use it simply as a checklist of items to get together; or, you may use it to complete an organizer for your tax advisor. To request your copy, simply send a request to me at phyllis@sagefire.com.