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There are two accounting methods for recording income and expenses, called the cash and accrual methods. These are two sets of rules for the timing of income and expenses.
A venture's income and expenses must ordinarily be reported in the year in which they occur. (Normally...
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All costs of getting a business started—before commencing operations—are not current expenses but are capital items, including advertising, travel, office supplies, utilities, repairs and employee wages. (IRC § 195.)
Under the tax code, these start-up expenses must be...
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All enterprises must keep their books based on accounting periods, called tax years. For individuals, the tax year is the same as the good old calendar year starting on January 1 and ending on December 31. Most small businesses are required to use the calendar year, too.
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If your business is a sole proprietorship that has employees or if your business is a partnership, limited liability company or corporation, you must get a federal Employer Identification Number (EIN). You will use this number on all business-related forms you send to the IRS....
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What can you do to improve your business tax situation before the year ends?
Determine Your Business Profit or Loss
Bring your accounting up-to-date. Know where your business stands from a profit or loss perspective. This will make your year-end planning more efficient...
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Running your own business? Make sure you claim the expense deductions you deserve without going overboard.
All businesses have expenses. Just about any expense that helps a business run or create a product is tax-deductible as long as it is "ordinary, necessary, and...
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