Preparing Profit And Loss Statement For The Irs

All of these programs require the IRS to perform a detailed analysis of the taxpayers financial situation. In order for this analysis to be completed, self-employed individuals will be required to provide the IRS with a Profit and Loss Statement. A Profit and Loss Statement is simply a document that lists all of the business income and business expenses over a specific period of time.

If the collection investigation is occurring during or shortly after April 15th, the IRS may be able to complete its analysis using the Schedule C from the taxpayers federal tax return. However, if the return is not available, or is outdated, the taxpayer may need to provide a separate Profit and Loss Statement. For some taxpayers, this can be a very challenging task. However, following a few simple rules can greatly assist you in this task.

Be accurate. You are required to provide complete and accurate information to the IRS. Therefore, you must take the time to make certain your Profit and Loss Statement is accurate. One way to do this is to use your monthly bank statements to create your Profit and Loss Statement. If you do not have all of the necessary statements in your records, ask your bank to provide them.

Be complete. Make sure you have accounted for all of your income and expenses on the Profit and Loss Statement. Taxpayers often make the mistake of leaving out basic business expenses. For example, a truck driver may forget to write down their fuel expense. Make certain you check your statement over twice to verify you have not forgotten any expenses.

Only list business expenses. Your Profit and Loss Statement should only list the expenses necessary to operate your business. You should not list your personal household expenses such as your home mortgage payment, personal insurance or none-business transportation expenses. The IRS will review the personal portion of your financial situation separately.

Consider getting professional help. Resolving your IRS collection matter can be extremely complicated and involved. Consider seeking assistance from a tax professional to help you prepare your financial information for submittal to the IRS and to negotiate a resolution of your IRS collection matter.

For your reference. Please find sample profit and loss statements below. One version is a profit and loss statement for rental income. The other version is a profit and loss statement for business income. The profit and loss statements are in PDF format. They are for your reference only. Please use them as guides as you prepare your own profit and loss statement for determining your rental and / or business income.

Are Home Businesses Going To Succeed in This Economy

I hear this question asked many times each week. I recently listened to an statement that was from the “Home Based Business Magazine Online” where they said It is estimated that nearly 70% of home based businesses will stay around and succeed for at least three and half years compared to 29% outside of the home based business ventures, for example a traditional offline business such as a store or a shop.

http://HomeBusiness.WealthMastermindSuccess.net

The higher success rate was due to the ability to be able to operate part time around a day job. This is a very important point.

Lets say that your are running an information product or education product from home, this has an advantage that where it allows you to let most of the technology work, the tracking, and with no packaging, it’s taken care of. It maybe a down loadable file such as audio, video or a PDF file made up as an e-book which also eliminates all of that administration whilst you can work to your own schedule.

This has a huge advantage, not only over a traditional job, but also over other businesses, as it allows you flexibility and free time. Oh and as I didn’t mention this, the others that work with me in my team all work from home too, which is awesome.

With major retail stores selling DVD’s and CD’s closing down daily around the globe, there’s one huge company who is thriving and is going to succeed in this economy, jamming their stores with people, buying Mac Books, iPods, iPhones and of course the new iPad.

Ther’e all buying these mainly to watch video, listen to audio files, download e-books.

The iPad alone sold over 300,000 in their first day of launch and one interesting point is they actually sold 250,000 copies of the e-book too on the day it opened.

With an estimated 100 million sales of the iPad this year, you can see where all of this is heading can’t you.

It’s a New Reality… Making money like in the past with old school ways is becoming increasingly more difficult.

We’re transitioning from a manual labor society to a knowledge society. People are paying for more knowledge and education than ever before on information and coaching. And it’s growing fast. e-books, advice, video, online education are all the trends and are currently the fastest growing industries in the world.

Home based businesses have more than double the chance of success in this economy than a traditional business, because it can flex around your schedule. An information business is what you can start right now with just a computer.

The bottom line is to…stop trying to make money in the past trends…it doesn’t work.

If you want to turn your knowledge into money you need to learn how to sell information products, education, advice and coaching by helping others from your knowledge, then you can market it online like so many others are doing very successfully.