I operate my business out of my home. Can I take a tax deduction for my home office? The Internal Revenue Service takes a very close look at all "home office" deductions. Your home must be your principal place of business. The room your office is in must be used exclusivelym for business purposes. If you qualify, there are many tax advantages to having an office in your home. To find out how to legally set up your home office and how to prevent your deductions from being challenged, get free Publication No. 587 from your local IRS Service Center or request it from the IRS, 1111 Constitution Avenue, NW, Washington, D.C. 20224.
Does my homeowner's insurance policy cover my home business activities?
In many cases a homeowner's policy specifically excludes coverage for home business-related accidents. Your auto insurance often has the same exclusion for use of your family car as a business vehicle. Be surem to check your policies for this exclusion. You may need to purchase separate business insurance that covers you, your home office, business-related use of your car, and your employees.
I'm just starting my home business. What records should I keep?
Your business records must be permanent, accurate, and complete, and must clearly document your income, expenses, and employee information. You can get help in organizing your records free from the IRS. The Small Business Tax Kit (Publication No. 454), available free, explains your record-keeping requirements. Pick up this helpful kit from your local IRS Service Center. While you are there, sign up for the free Small Business Tax Workshop. It is specially designed to help the new business owner.
I was turned down by a bank for a loan. Is there any other place that can help me get financing for my business?
You might qualify for a Small Business Administration loan. The SBA loan program was organized to help small-business owners who cannot obtain conventional financing from a bank. Additional special loans are set aside for women, minorities, and business owners from disadvantaged rural areas and areas with high unemployment. For more details call toll-free 800 433-7212 and ask for the free publications "SBA Loans, 8 (a)," and "SBIC Financing for Small Business." Request a free catalog of other SBA publications while you are at it.
My background has not really prepared me to start and run a business. Where can I get help?
Get in touch with your state department of commerce. Most states have small-business assistance offices that provide free seminars and programs for new business owners. Put your name on the mailing list at your regional SBA office. The SBA coordinates many helpful programs. Call your state university. Each state has a small-business development center which presents joint government, academic, and private-sector services and programs for the area business community. Help for women business owners is available from the American Women's Economic Development Corporation, 1270 Avenue of the America s, New York, N.Y. 10020.