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Showing posts with the label bookkeeping tips

Day 7 – How to Hire Your Kid Legally — And Save Taxes

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  Day 7 – How to Hire Your Kid Legally — And Save Taxes Hiring your child might sound like a sentimental idea, but it’s actually a strategic tax-saving move —if done right. The IRS allows business owners to hire their minor children under certain conditions, offering both tax deductions for your business and income tax benefits for your child . Here's how to make it work legally and efficiently. ✅ Why Hire Your Child? 1. Your Business Gets a Deduction Wages paid to your child are a legitimate business expense. That means your business income (and tax liability) goes down. 2. Your Child May Owe Zero Taxes As of 2025, a child can earn up to $14,600 (the standard deduction) without paying any federal income tax— as long as it’s earned income (i.e., wages, not gifts or allowances). 3. No Payroll Taxes for Some Businesses If your business is a sole proprietorship or a partnership where both partners are the child’s parents , and your child is under 18 , then: No Social S...
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πŸ“… Day 5: How to Track Mileage Without the Stress

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  πŸ“… Day 5: How to Track Mileage Without the Stress If you drive for business — even occasionally — tracking your mileage could lead to real tax savings. But let’s be honest: nobody wants to carry around a paper logbook or guess their odometer reading every day. Good news: there are smarter (and simpler) ways to do it. πŸš— Why Mileage Matters The IRS allows you to deduct business-related driving at the standard mileage rate , which in 2025 is $0.67 per mile (subject to updates). That means: 100 miles = $67 deduction 1,000 miles = $670 deduction For many solopreneurs, that’s hundreds or even thousands of dollars in write-offs — if you track it properly. ✍️ What Trips Can You Count? Driving to meet a client Picking up business supplies Visiting a vendor or coworking space Attending a business conference or training 🚫 Personal commutes don’t count (like from home to a regular office location). πŸ“± 3 Stress-Free Ways to Track Mileage Mileage Apps (automated, low eff...
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πŸ“… Day 3: What Actually Counts as a Business Deduction?

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  πŸ“… Day 3: What Actually Counts as a Business Deduction? “Can I write this off?” As a CPA, I hear this question all the time — and honestly, it’s a good one. Business deductions aren’t just about saving money on taxes; they’re also about understanding what counts as an ordinary and necessary expense in your field. Here’s a simple breakdown to help make sense of it: ✅ The IRS Rule (in plain English) To be deductible, an expense must be: Ordinary : Common in your industry Necessary : Helpful and appropriate for your business It doesn’t have to be essential — just reasonable. πŸ’Ό Commonly Deductible Business Expenses Office Supplies & Software : Pens, printers, QuickBooks, Canva Pro Marketing Costs : Website hosting, email tools, social media ads Business Meals : 50% deductible when dining with clients or for business travel Professional Development : Courses, certifications, books related to your work Phone & Internet : Pro-rated for business use Mileage o...
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Bookkeeping Categorization/ νšŒκ³„ λΆ„λ₯˜

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Mastering  Bookkeeping Categorization : The Foundation of Financial Clarity Whether you're running a startup, managing freelance income, or just trying to keep your side hustle organized, one of the most overlooked—but absolutely critical—parts of financial management is bookkeeping categorization . Properly categorizing your financial transactions is more than a clerical task—it's the key to informed decision-making, tax compliance, and business growth. What Is Bookkeeping Categorization? At its core, bookkeeping categorization involves labeling each transaction (income, expense, asset, liability, or equity) so it fits into a well-defined chart of accounts. These categories help paint a clear picture of your financial health, ensure accurate reporting, and simplify tax time. Example: Date Description Amount Category 2025-05-03 Shopify Sales $1,200 Income 2025-05-05 Google Ads $300 Advertising 2025-05-07 MacBook Purchase $2,000 Equipment Why Is It Important? 1. Tax Deduc...
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