• 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.

Developing an email list is one of the most important things you will ever do for your business. Did you know that most people don’t make a purchase from a website until they’ve visited it at least five times? This means that even if you get a potential customer to your site, they probably won’t buy anything. This is largely because people are so protective of their credit card information, with good reason, and won’t give it out unless they trust your business.

Because of this, you need to get their email so that you have the opportunity to stay in contact with them. If they visit your website once and then leave, you’ll probably never hear from them again. You’ve not only lost a sale that day, but the potential for continued business from that person. This is why an email list is so crucial. You can’t do effective business without it!

You could go out and buy a thousand random email addresses from an email broker, but these contacts would have no idea who you are and would probably be annoyed by your unsolicited emails. They could also report you as spam, and they would have a valid point.

So you absolutely must get the email addresses of those who visit your website. They came to you! They are already interested in what you have to offer! These are self-selected sales leads! Experienced internet marketers will do whatever they can to obtain the email address from anyone who visits their website.

Because an email list is so crucial to the success of your business, your list plays a major role in the value of your business if you were to sell it. A prospective buyer would want to know the size and quality of your email list, because this is one of the best ways to ensure the continuity and success of your business. The contacts on your list are self-selected people who are interested in what you have to offer. It would take a six-figure marketing campaign to reach an equal number of people through different means.

The experts from Professional Marketing International recommend that anyone who is serious about their online business get an autoresponder. With an autoresponder system, you can provide an opt-in box on your website where people enter their name and email address.

Here is an example of a typical opt-in:

Typically, you would use a lead magnet here to add incentive. Common lead magnets include eBooks, articles, contests and prizes. When someone enters their information, the autoresponder will immediately fulfill the incentive, as well as sending out a drip sequence over a predetermined time period.

Whatever method you decide to use, you should begin now to develop a solid email list. You list will allow you to stay in contact with both current and prospective customers, helping them become familiar with your business. Also, it will help them understand the specific benefits of your business. Prepare for future success by developing a quality email list today.