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BudgetPulse and Your Home Business

Posted by : Premraj | Posted on : Tuesday, April 1, 2008

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Co-mingling is the practice (illegal in the corporate world) of mixing personal monies with business assets. The inexperienced home businessperson doesn’t automatically realize that business assets and personal are different categories or that proper money management means keeping them apart. Unfortunately, this all comes back to haunt them when taxes are due.
Business taxes
Business income allows for deductions that aren’t permitted for personal, wage-based employee income. Supplies for the home business, equipment, use of the home and car mileage may all offset business income. To take advantage or these deductions, expenses have to be tracked.
This is where BudgetPulse can be a real help. By keeping business financials separate with a BudgetPulse account, income and expenses can be easily recorded. This keeps everything documented and readily available when taxes are due. It also provides an easy to see ‘snapshot’ of how the business is doing. For the new entrepreneur trying to make sense of a drawer full of receipts and hand-written notes they’ve accumulated, BudgetPulse will seem like a great gift.
In the US, quarterly estimated taxes are coming due on April 15th. Called ‘quarterlies’, these are estimated taxes sent to the IRS for entities that do not have taxes withheld from a paycheck. In other words, sole proprietorships and other business models will have to send payments in every quarter. This is a different setup than wage earners are used to. Without ready access to accurate information about their home business, it is likely that their new tax situation will cause a great deal of anxiety and stress. They may even miss the deadline or not realize there is a deadline.
A practical solution
By setting up accounts for income on BudgetPulse, and then setting up categories of expenses — computer related costs; mailing fees; advertising/marketing costs; other expenses related to the business — it is easy to download an Excel spreadsheet showing cash flow and net profit. This is precisely the data a small business will need for tax purposes.
The entrepreneurs who use accounting services shouldn’t overlook BudgetPulse. Just give the accountant your user name and password so they can pull up the business records they need.
So, with the advent of new home businesses facing not only the challenges of any startup, but also the unfamiliar territory of business accounting practices, BudgetPulse can turn a thankless task into a manageable one. Convenient, worry-free and controlled; that’s how professionally handled records and finances should be.

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