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The Tax Foundation in Washington D.C. reports that the average American loses about 35% of their income to taxes. This represents the single largest family expense. Taxes alone cost the typical family more than their home, food, and clothes combined. No wonder so many Americans are living pay check to pay check, trying to work their way out of a mountain of consumer debt, mortgages, and car payments.

The problem is that congress has taken all but a few tax deductions away from the average American. You may not realize it but there are really two sets of tax laws in America. The first is for employees; they can only deduct their interest on their mortgage, property taxes and contributions to qualified retirement accounts or charities. The second is for the home-based business owner. He is entitled to deduct everything the employee can and in addition he can deduct all of his business expenses. These deductions include; rent, utilities, long distance, insurance, water, furnishings, computers, telephones, medical expenses, supplies, fax machines, travel, entertainment, automobiles.... In short-- EVERYTHING!!

Most small businesses don't produce huge incomes in their first one to two years. Congress knows starting and succeeding in business is tough. That is why they passed laws allowing business owners to deduct their expenses. After all, they want you to succeed. Your future success adds to the countries economy and brings in more tax dollars. For this reason Congress "subsidizes" you while you are growing your home-based business.

If your business produces a loss, you may generally deduct that loss against any form of income. This includes wages, interest, dividends, rents, retirement and even that of your spouse's income (if you file jointly). These deductions can amount to a huge savings. In many cases the tax savings you receive from your business can far out way your income for the first couple of years. For example: Jim earns $50,000 at his job. If he starts or has a home business that produces a tax loss of $20,000, he only pays tax on $30,000.

The key benefit is that you don't have to create new expenses to get more deductions. You simply convert already existing expenses from non-deductible to perfectly legal business expenses, which are deductible. Our clients are most pleased when they learn how to structure their vacations anywhere in the world, so they are tax deductible. They also love learning to deduct the equivalent of their children's education by employing them in their business. This deduction alone can save thousands each year. These examples are just two of the over 100 strategies that can be employed by most business owners.

If you're saying to yourself, "I'm sure glad my accountant takes care of all that for me". Don't fool yourself. There are over 40,000 pages of complicated tax code. Nobody is a complete expert on taxes. Assuming your accountant watches over all your tax matters is like saying the dentist takes care of your teeth. You take care of your teeth on a day-to-day basis; while the dentist makes sure that no problems exist. The same goes for your accountant. In addition, most accountants specialize in just one area of the tax law. So, find an accountant who specializes in home-based business and don't be afraid to look into the matter on your own. In this case a little knowledge can go a really long way.

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