• Be very sure what you can and can’t deduct. Tax software is great but it isn’t foolproof so do your homework and still read the tax booklet for all the deductions about home businesses and perhaps consult a tax accountant. However, using software is a good idea. It really does help you calculate.
• There is a notion, which may or may not be true, that home business deductions can flag you to the IRS. It used to be more true as home businesses weren’t as prevalent. But it’s still somewhat of a flag, thus –
• Have specific, thorough documentation about everything.
• Your home office cannot be used for any personal use at all. No personal emails, writing a letter to your Aunt Sue that’s printed on your home office’s printer unless it’s specifically about business. We’re talking the IRS here. It’s not a good idea to fudge it, even a little.
• Too, you can’t have anything of a personal, non-business nature in this office, not even in the closet.
• After you do your research, you may find that claiming certain deductions for your home business isn’t a good idea. Weigh your options carefully.
• If you have claimed certain deductions in the past, make sure the rules are the same. The IRS changes things sometimes, so make sure you are clear on what’s what for the year you are working on.

Here is what it says on the IRS site:

Whether you are self-employed or an employee, if you use a portion of your home for business, you may be able to take a home office deduction.  Here are six things the IRS wants you to know about the Home Office deduction

1. Generally, in order to claim a business deduction for your home, you must use part of your home exclusively and regularly:

• as your principal place of business, or
• as a place to meet or deal with patients, clients or customers in the normal course of your business, or
• in any connection with your trade or business where the business portion of your home is a separate structure not attached to your home.

2. For certain storage use, rental use, or daycare-facility use, you are required to use the property regularly but not exclusively.

3. Generally, the amount you can deduct depends on the percentage of your home used for business. Your deduction for certain expenses will be limited if your gross income from your business is less than your total business expenses.

4. There are special rules for qualified daycare providers and for persons storing business inventory or product samples.

5. If you are self-employed, use Form 8829, Expenses for Business Use of Your Home to figure your home office deduction and report those deductions on line 30 of Form 1040 Schedule C, Profit or Loss From Business.

6. If you are an employee, additional rules apply for claiming the home office deduction. For example, the regular and exclusive business use must be for the convenience of your employer.

For more information see IRS Publication 587, Business Use of Your Home, available at http://www.IRS.gov or by calling 800-TAX-FORM (800-829-3676).
Links:

• Publication 587, Business Use of Your Home (PDF 214K)
• Form 8829, Expenses for Business Use of Your Home (PDF 64K)
• Form 8829 Instructions (PDF 29K)
• Schedule C, Profit or Loss from Business (PDF 111K)
• Schedule A, Itemized Deductions (PDF)

Do your homework and take the deductions you can. It’s worth it.

1. Bootstrapping

Perhaps you’ve heard your Mom or Dad tell you to “Pick yourself up by the bootstraps.” So what exactly is bootstrapping in the context of business? “To bootstrap” is to fund your own business. If you already have come money saved, this could be the perfect option for you. It usually takes a little longer to get your business going with this type of financing, however, bootstrapping gives you freedom and flexibility because you have 100% control over your business. Many successful companies have “bootstrapped” in the beginning, starting out with a budget of $1,000 or less deducted from their own pockets. For example, Dell Computer was started by Michael Dell out of his college dorm with a fund of about $1,000. Now Dell is worth approximately $14.6 billion.

2. Budget!

No one likes saving their money, but in the beginning stages of your little business it would probably be wise to penny-pinch. Avoid buying new equipment and haggle, if need be. Throw your money into an account and do not touch it! You can even put some of the money earned into a savings account, while keeping money that you want immediate access to in a regular bank account.

3. Scholarships

There are a significant amount of scholarships for young entrepreneurs out there.  You should check out the Young Entrepreneur Awards for resources for scholarships. Also make sure to look for scholarships locally — check out the opportunities in your area and then search nationally. You are much more likely to receive funding locally than nationally because at the local level you will have less competition.

4. Borrow Small

We can always count on our family and friends to be there when we need some help. So why not ask them to loan you some money when starting your business? Of course, you should probably sketch out a legal document, writing down the terms of agreement of the loan, to avoid any conflict.

It’s probably true that you “need money to make money,” but if you follow these four tips, you’ll surely be earning cash in no time!

James Kim is a writer for Choosewhat.com. ChooseWhat is a company that provides product reviews and test data for business services and products.  Their goal is to help small companies make informed buying decisions on business solutions that help their business.

So what’s wrong with these people? Are they in denial? Have they simply not yet experienced the sweet nectar of Facebook?

A common answer is privacy concerns with Facebook. Despite a very simple and clear interface, and literally millions of resources on how to keep Facebook private, and the ability to simply not put any personal or private information out there,  there are those who are still concerned about their privacy and abstain from Facebook.

Fair enough.

But a less common – and more understandable – reason to not use Facebook is that it’s an enormous waste of time. For the average user, it adds very little value to their lives, and certainly not more value than could be gained through not using Facebook. And while it’s fine to be mindlessly entertained or to use the Internet as an escape, people are spending inordinate amounts of time on social networking site.

Now, to be clear, Facebook is not a waste of time for businesses; but that’s only because individual users refuse to acknowledge it’s a waste of time. If Facebook’s 500 million users realized they were wasting their lives away, using the social networking site as a surrogate for actual interaction, there would be no need for businesses to utilize that network to build their brand and promote their products.

But the fact of the matter is that there are 500 million active Facebook users. Each of them may use the site a little differently, but that doesn’t mean you can’t utilize Facebook (and other social networks) to connect with current and potential customers, build your brand, and grow your business.

So unless and until people stop using Facebook, don’t let on that they’re wasting their lives away.

WordPress downloads continued to increase to 1,545,703 in 2006 and 3,816,965 in 2007. It’s now the largest self-hosted blogging tool in the world and is used for millions of sites and seen by tens of millions of people every day. In fact, there are over 15 million WordPress blogs, or sites, on the internet today; that includes 6 million blogs hosted on WordPress.com and another 9 million active installations of the WordPress.org software.

WordPress.com and WordPress.org are very similar in function and appearance, but have some key differences. The main difference between the two is that WordPress.com is hosted by WordPress and WordPress.org isn’t.

WordPress.com allows you to quickly and easily create a simple blog using the WordPress domain name. For example, if you wanted to blog about parrots, your domain could be www.parrotworld.wordpress.com. This is an excellent way to create a fun, personal blog about a topic you are interested in, or as a way to keep family members updated on your life. 

However, WordPress.com does not allow any affiliate links to be used on its platform; so to profit from affiliate marketing, you need to download WordPress.org to a hosting provider like BlueHost or DreamHost. Accessing and downloading WordPress.org is free, but you need to pay a nominal amount for the third-party hosting service. 

To enhance functionality and scope, WordPress added a Multi-User feature. By utilizing WordPress, you can moderate more than one blog from the same dashboard. This saves business owners a lot of time and effort.

If you haven’t heard of Tumblr and Posterous, you are missing out on a convenient way to spread the word about your business. Promotion can take so much of your time that any effective tool should be readily welcomed. 

Tumblr is a blogging interface that provides you with access to a vast network of professionals. They make customization a snap, which is great news to any entrepreneur trying to establish a unique presence online. They provide easy-to-use analytic tools, so you can always be tracking and improving your site. Because Tumblr is connected to other social media platforms, it makes your promotional efforts much more effective. This strong internet presence contributes to their high Page Rank, which makes things easier for you. 

Posterous provides you with a convenient way to upload, tag and organize all kinds of media. Distributing videos, photos, text and audio has never been easier. Like Tumblr, Posterous is compatible with a host of other social media sites, making it a powerful hub in your promotion plan. You can share content with WordPress, Facebook and Twitter with the click of a button. 

To save time and effort in your social media campaigns, check out Posterous and Tumblr today. They provide a convenient way to consolidate your work and reach a whole new audience.

–Bill Rancic

Overnight success certainly sounds amazing. In reality, however, it is a rare occurrence. More likely, you’ll need to put in significant time and effort before you attain the highest levels of success. There will be rewards along the way, but it takes persistence to reach the top.

When you look at successful business people, you may forget that they were once struggling entrepreneurs. But many of the most successful business icons in the world experienced years of failure and frustration before reaching their elite status. True entrepreneurs know that overnight success is impossible and that mistakes and failures are necessary to their development. Unlike being an employee in a large corporation, when you are in business for yourself, failures affect you directly – there is no buffer between you and your actions. But this directness also allows you to reap the rewards of your successes in a way unimaginable to corporate employees!

Starting your own business is an exciting and challenging endeavor. Don’t try to do it alone. Learn from those who have gone before you. Benefit from their strategies. 

The most successful business leaders in the world have all built upon the examples of others. They learned from their mentors and used their experience as a springboard to bigger things.

No one can say things quite like Yogi Berra did.

Having an important aim, a direction, is vital to your success. Goals are the foundation upon which you can build your successful online business.

Let PMI help you achieve your dreams of success.

• Accept Legitimate Criticism It can be tough to hear skepticism from those you love, but they may have a point. Their criticism should never be enough that you scrap your idea altogether, but it may help you tailor and improve your business.
• Avoid Delusion Sometimes people will get such a hold of an idea or product that they’ll never let go. Passion and positivity shouldn’t turn into being out of touch with reality. Friends and family may actually help keep you grounded.
• Stay Positive It can be discouraging if those you care most about aren’t supporting you, but try to stay positive. If you need to, spend less time with those individuals; if you do spend time with them, keep the conversation about something other than your business. Avoiding confrontation is best.
• Stick To The Real Facts There are plenty of facts out there about how unlikely it is for your business to succeed. Instead focus on all the data out there about why you will succeed, and realize that you’re going to be able to avoid all the downfalls of those other businesses because you have a proven system in place.
• Good Business Plan Every business should have a comprehensive business plan. Preparing and studying the plan will help you answer any criticism your family and friends may have, which is an added reason to have a good one.
• Prove Them Wrong So your family and/or friends doubt your ability to succeed – so what? Use that as motivation to work even harder and prove them wrong.