Mark Sullivan CPA

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Avoid Mixing Biz & Personal Calls Starter Plan For New & Small Businesses

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Once you determine to create an LLC (Limited Liability Company), you have to go through the motions of doing so in the state that you plan to operate in. The steps are simple, but vary from state to state. First, go to the State Corporation Commission. Apply to create your LLC. If you don't find it readily as a menu option, use the search feature. The process usually involves answering about a dozen questions. Many states do not allow the use of a PO Box as the main office for the business. Don't worry; use your home address. You typically have to complete the Articles of a Limited Liability Company. Next, chose a unique name. The SCC has a search feature to see if your intended name is unique. If not, consider another name. You need to indicate the Principal Office; aqain many states do not allow the use of a PO box. Next, choose a registered agent. A registered agent is someone who can accept and sign for documents for the LLC. Someone other than yourself who would be responsible is usually a goo choice. They must meet qualifications to be acceptable to your state. Once done, you can either submit electronically or via mail. A fee is involved. A must-do is to keep all records as these will become important in the future. Questions? - Mark Sullivan, CPA

Do you find that the IRS has examined one of your tax returns and they have assessed a penalty and interest? Is it the first time? If so, I know how to get your penalty waived, but you must meet certain criteria. Not a trick, just knowledge of the Tax Code. If you think this applies to you, let me know. I can, and have, eliminated first time penalties.

Here is one that is a pet peeve of mine: you own a business whether a C Corp, a sole proprietorship, or any other type of business entity. You went to a preparer last year to have your taxes prepared, but the preparer fails to deduct their own fee which ordinarily is hundreds of dollars. If you are a Schedule C filer as part of a 1040, take a look at line 17. Legal and professional fees. Is there anything there? Example: If the fee was $400.00 in the prior year, the failure to deduct their fee could cost you $180.00 (assumes a combined tax rate of 45% which could be higher still). This tells you all you need to know about the preparer; i.e., they don't know what can be deducted and they are not good at their job. - Mark Sullivan, CPA

Did you know that the current rate for deductible mileage is $.56 per mile? If you drove 10,000 miles for your business, this would equal a deduction of $5,600.00. That amount could save you in excess of $2,300 in federal income tax, F**A and Medicare (the Self Employment Tax), and state income taxes. Not sure of how to account for your mileage expenses? Send me a note with the word
"MILEAGE" and your email address. I will send you two brochures that tells you all you need to know to take advantage of this overlooked but extremely valuable deduction plus a mileage tracker. - Mark Sullivan, CPA

I will begin to offer webinars covering a variety of topics relevant to the small business owner. If you are interested, please send me a note and I will keep you informed.