Articles
IRS's Top Seven Tips for Taxpayers Who Have Started or Are Thinking of Starting a New Business
Tuesday, July 28, 2009
Anyone starting or thinking of starting a new business should be aware of their federal tax responsibilities. Here are the top seven things the IRS wants you to know if you plan on opening a new business this year.
First, you must decide what type of business entity you are going to establish. The type your business takes will determine which tax form you have to file. The most common types of business are the sole proprietorship, partnership, corporation and S corporation.
The type of business you operate determines what taxes you must pay and how you pay them. The four general types of business taxes are income tax, self-employment tax, employment tax and excise tax.
An Employer Identification Number is used to identify a business entity. Generally, businesses need an EIN. Visit IRS.gov for more information about whether you will need an EIN. You can also apply for an EIN online at IRS.gov.
Good records will help you ensure successful operation of your new business. You may choose any recordkeeping system suited to your business that clearly shows your income and expenses. Except in a few cases, the law does not require any special kind of records. However, the business you are in affects the type of records you need to keep for federal tax purposes.
Every business taxpayer must figure taxable income on an annual accounting period called a tax year. The calendar year and the fiscal year are the most common tax years used.
Each taxpayer must also use a consistent accounting method, which is a set of rules for determining when to report income and expenses. The most commonly used accounting methods are the cash method and an accrual method. Under the cash method, you generally report income in the tax year you receive it and deduct expenses in the tax year you pay them. Under an accrual method, you generally report income in the tax year you earn it and deduct expenses in the tax year you incur them.
Visit the Business section of IRS.gov for resources to assist entrepreneurs with starting and operating a new business.
For the latest IRS news, products and services, subscribe to IRS.gov e-News for Small Businesses at: http://www.irs.gov/businesses/small/article/0,,id=154825,00.html
WBIS Helping Women Collaborate...Cultivate & Celebrate Success
Friday, April 10, 2009
After the birth of her second child in 1999, Sheila Dixon left her corporate career in the retail industry to stay at home with her two sons. The transition was challenging. In addition to caring for a baby and toddler, Dixon needed to find a way to add to her family's income. Like many moms, she hoped for a job that would allow her to work from home around her family's schedule.
Dixon began working as a web editor for another stay-at-home mom and also worked as a business consultant, structuring systems for solopreneurs. She then discovered the world of network marketing and direct sales.
"I attended a special day-long event for women and found there were hundreds of women who had creative businesses and were making an income," says Dixon. "I realized there was a whole other world out there and I liked what I saw."
Soon after, Dixon developed the idea for a women's professional group that would provide an environment of social and economic empowerment for female business owners. After researching other networking groups and business expos in the Northern Virginia area, Dixon launched WBIS in early 2003.
The group's first luncheon was held at Paradiso Restaurant in Springfield, Virginia. Dixon and her WBIS team invited 40 women business owners. Three showed up. But from there, the word spread and the numbers began to grow.
Today, WBIS is a dynamic group offering professional women the opportunity for personal development, business growth, and relationship building. Each monthly luncheon includes an educational component that inspires the women to reach their personal and professional goals. In addition, the group hosts interactive workshops and seminars that address the specific needs of the members.
The membership includes many seasoned entrepreneurs, as well as women who have just launched their own companies. In addition, WBIS does not limit membership by business type, so at any given event, you might find interior designers and online retailers sharing resources and providing referrals to bankers and direct sales representatives.
WBIS member Emily Murphy found the variety of members helpful when she was starting her company, Emily's Teas, after retiring from a long teaching career.
"At my first WBIS luncheon, I met other women also in various stages of launching and growing their businesses," says Murphy. "Over the months, I made wonderful friends, so when I needed a baker to bake scones and cookies for my tea parties, I was confident Gale King of Treats by Gale could do a fine job. When I needed a head shot for my web site, I put myself in the capable hands of photographer Elizabeth Linares. And when I needed to change my image, Kathy Kalmar of Mary Kay Cosmetics was ready to give me a complete makeover."
In addition to the monthly luncheons and other events, the WBIS Online Network offers members another avenue to build relationships and grown their businesses. The members-only social networking site includes professional profiles, a calendar of member events, and discussion forums. Members are encouraged to share news about business successes, send out emails about an upcoming event, write an article, or post a business ad.
For member Kerry Molina, building relationships within the WBIS network can be empowering for women as they work through the ups and downs of their businesses.
"My favorite thing about being a member is the reassuring feeling that I'm never alone," says Molina, who is a direct sales representative for a national sterling silver jewelry business, and also owns Yellow Brick Road Studio, offering academic tutoring, unique enrichment classes, and one-of-a-kind art pieces.
"I enjoy knowing that I am surrounded by a constantly expanding group of like-minded women," Molina continues. "The relationships I've built have motivated me to be a better businesswoman?and the group has been a supportive, safe place to land on my 'business feet.'"
From its first luncheon back in 2003, WBIS has expanded beyond Fairfax County. In addition to a new chapter in Prince William County, which formed in August 2008, the group will be launching an Arlington chapter this summer.
For Dixon, growing WBIS remains a priority as she also balances raising her three sons and her work as co-owner and marketing director of Centreville Medical Arts Pharmacy, the business she started with her husband in 2008.
"Along with my dedicated team of WBIS leaders, we will continue to work diligently, creating programs that address our members' needs and empower women to be their best self," says Dixon.
Social Capital...How Important is it?
Wednesday, March 18, 2009
Think about a recent project, assignment or initiative you worked on over the past month. At some point you probably couldn't find the information or resource you were looking for in the company knowledge database or on the internet so you picked up the phone, sent an email or got up and physically walked over to ask another colleague for some help.
I'm willing to bet, you realized at that point, you could have saved a lot of time, money and effort if you had just reached out to your network in the first place.
According to social scientist, Karen Stephenson, organizations are starting to realize how vital internal networks are in the transfer of tacit knowledge. Tacit knowledge is the information and context we have on people, resources and experiences.
You won't find tacit knowledge in your company database on how to best "sell" your idea to your boss or how to best work with sales and marketing to make sure they don't sell something that your technical team can't deliver. Tacit knowledge is shared people to people thru a network based on personal relationships and trust. Often people are not aware of the important knowledge or information they possess and how it could be valuable to someone else.
In today's business climate, the companies that are providing opportunities to build social capital between employees are the ones finding success.
I recently spoke to Standard & Poor's which has an active internal women's network initiative which brings women together from all of the different divisions of S & P. The women are encouraged to meet in person and virtually to share information and resources. In the group that I spoke to, there were five different divisions of S & P represented and most of the women had never met each other before. These internal networking opportunities allow for free exchange of tacit knowledge, career advice and best practices within all the divisions which keeps S & P at the top of their game.
There are many types of networks that you probably already tap into but haven't realized how valuable they can be to your personal and professional growth. Think about the people you know and see if you can list a few names for each of these important knowledge networks we all should have:
1) The "work" network. Who do you talk to on a daily basis as part of your work routine?
2) The Social Network. Who do you check in with both in and out of work to find out what's going on?
3) The Innovative network. Who do you like to connect with to share new ideas and brainstorm possibilities?
4) The Expert Network. Who do you turn to for expert advice?
5) The Career Advice Network. Who do you talk to for career or strategic direction?
As you think about these important networks you have, ask yourself what you could be doing to grow your social capital by looking for ways to be a resource for these networks. Ask people, "How could I be a resource for you?"
Remember you have knowledge that could be vital to someone in those networks, don't take it for granted.
Sarah Michel, CSP
Perfecting Connecting®
Speaker, Author and Trainer
"I work with organizations who want a personality-centered, results-based approach to master the art of connecting with anyone, anywhere, anytime."