Over the past 15 years, home based businesses have emerged and grown faster than any other sector of the business marketplace.

Everything from businesses selling products on EBay to providing pet grooming or housecleaning services to offering insurance, securities and other financial products right from home have become commonplace businesses. So much so that it is no longer embarrassing to answer the question, “What do you do?” with the response, “I work in my pajamas.”

This is great, but it comes with its challenges. Family life gets disrupted often, and work time is equally easy to disrupt with personal intrusions. Worse, many folks just don’t know what to do about their taxes. While there are some tremendous tax advantages to operating your business from home, it can be very difficult to discern where the lines between personal and business deductions are, and complex tax rules can make it difficult to take ordinary business deductions just because you run your business from home.

Never fear, we’ll get you set off on the right path!

Common expenses such as the home office deduction, business mileage deduction for transportation, the mortgage interest deduction, real estate taxes, insurance, and others are all vital to your home based business. In the case of the interest, taxes and insurance on your property, as a home based business owner, you may now take these deductions on Schedule C regardless of whether or not you itemize.

Recent changes in the tax law, also provide the benefit that for the expenses related to your home, you no longer need to “recapture” them when you sell your home. Instead, you can take full advantage of the exclusion from capital gains taxes without an offset for the recapture of home business expenses – what a deal!

From here, the rules become even more complicated and it is wise to rely on the expertise of a service like TurboTax Online, or to consult a professional to make sure you save every dollar on your taxes you deserve! As always, if you need us – we are here to help!