Do You Have a Hobby Business or a Real Business?

With tax time right around the corner, it is important that you ask yourself the following very important question: do you just have a hobby business or have you turned it into a real business? For many people, developing multiple income streams and side incomes starts as a hobby business.  For a few, these hobby businesses turn into real businesses.  Why does this matter? Well, it matters because the IRS taxes business income and hobby income slightly differently, and it is important that you know the differences so you don't get audited, owe penalties, and more.   Do I Have a Hobby Business or Real Business? Generally, an activity qualifies as a business if there is a reasonable expectation of earning a profit.  In order to make … [Read more...]

6 Financial Tips for the End of the Year

2012 definitely seemed like it flew by quickly. Hopefully it did not seem to escape you as quickly as it seemed to escape me. With the end of the year quickly approaching, there are many personal finance money moves that you might want to do or try in order to fully maximize the year. This is so that you can plan more realistically for 2013, and to also see how you truly did in the year of 2012. There are probably hundreds of other things on your to-do list in December, but your financial well-being is also very important. Wrapping up your year by reviewing how you did financially can be beneficial and also refreshing to see how you did. We like to do many of these things at the end of the year so that we start out well in 2013. We also … [Read more...]