Read Microsoft Word - Tax Benefits for a USANA Associate.doc text version

Tax Benefits for a USANA Associate (Overview)

Understanding Taxes Taxes are the #1 expense in the U.S. What you pay in Federal & Social Security taxes may exceed what you pay for food, mortgage, transportation, and clothing combined. Two tax systems existing in the U.S.: - Tax system for employees - Tax system for self-employed people U.S. Tax System is built on incentives to encourage desirable behavior & activity (Ex. Home ownership) Self-employed people are encouraged to create growth. Small businesses constitute the majority of job growth in the U.S. Save on taxes by reducing your taxable income either by decreasing your income or increasing your deductions. Examples of self-employment deductions ·Office equipment ·Home office ·Food & Entertainment ·Travel expenses ·Automobile ·Business functions ·Dry cleaning If your business produces a loss, you can generally deduct that loss against any form of income. If your loss exceeds your total family income for the year, you may carry back the losses 2 years and receive a refund from the federal gov't for the taxes paid in the last 2 years or you can carry forward the loss 20 years to offset 20 years of income. Ex. Steve earns $50k in his job with Boeing. He starts a home-based business that generates a loss of $10k. Steve pays tax on only $40k of income. Run your Business as a Business Must show that you entered into the activity with objective to make a profit.

·Remain on auto-ship (own your business). ·Set up a separate business bank account. ·Use a separate credit card for USANA. ·Have your own business cards made. ·Document business intent (Business Plan). ·Utilize a tax diary or tax organizer.

·Work business regularly (does not mean you need to work your business full time, just show consistency).

Mistakes to Avoid ·Don't fear taxes ­ educate yourself. ·Don't believe your Accountant or Tax Preparer is responsible for your taxes ­ You are responsible for your taxes.


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