Articles by Kristine McKinley on ArticleSnatch.com

How Can Hiring Your Kids Help You Save on Income Taxes?

Fri, 20 Jul 2007 00:00:00 -0400

Hiring your children in your business can be a great tax savings strategy, as well as a way to teach your children about business and money. Wages paid to your children (between the ages 7 and 17) are a valid business deduction, as long as they do bona fide work, and they are compensated fairly. Your children can earn up to $5,350 (the standard deduction amount for 2007) before they will owe any income tax. Because you are getting a business deduction for the wages paid to your child, this is income that you also will not pay taxes on. In addition, if your children are under age 18, you don't have to pay Social Security or Medicare taxes on them. You do not have to pay unemployment taxes on them as long as they are under age 21. This is a huge tax savings since you would have to pay these taxes on any other employee you hired. Even if you pay your children more than the standard deduction amount, you will still come out ahead. **End Summary** Topics: hire your children]]> save taxes]]> work at home]]> work at home mom]]>]]> About the Author: ]]> Kristine A. McKinley, CFP, CPA, and founder of Beacon Financial Advisors, teaches individuals and families how to invest and plan for retirement, college, and other financial goals. Kristine offers financial and tax planning on an hourly, fee-only basis. For free financial planning tips, worksheets, checklists and more, visit http://www.financialtipsforwahms.com

The Fastest Way to Pay Off Debt

Fri, 08 Jun 2007 00:00:00 -0400

There's some debate among financial planners as to the best way to pay down debt. Some say paying the highest interest rate debt first is the best way; others say paying the smallest balance first is the best way. Both methods have advantages and disadvantages, so we'll take a look at both, and help you decide which method is best for you. Method #1 - Highest Interest Rate In this method, you focus on paying off your highest interest rate debts first. The basic steps in this method include: 1. List all debts in order from the highest interest rate to the lowest interest rate. 2. Commit to paying the minimum payment on every debt. 3. Determine how much extra can be applied to the highest interest rate debt. 4. Pay the minimum amount plus the extra amount towards the debt with the highest interest rate until it is paid off. 5. When that debt is paid off, apply the amount you were paying to the debt that is paid off to the next highest interest rate debt until paid off. 6. Repeat until all debts are paid in full. **End Summary** Topics: debt]]> debt management]]> debt reduction]]> pay off debt]]> credit cards]]> credit card debt]]>]]> About the Author: ]]> Kristine A. McKinley, CFP, CPA, and founder of Beacon Financial Advisors, teaches individuals and families how to invest and plan for retirement, college, and other financial goals. Kristine offers financial and tax planning on an hourly, fee-only basis. Did you find this article helpful? If so, then be sure to check out our new ebook, Living Debt Free! => http://beaconfinancialtips.com/

Do You Need to Make Estimated Tax Payments?

Wed, 06 Jun 2007 00:00:00 -0400

The second quarter estimated tax payment is due in less than two weeks (June 15). Do you know if you need to make estimated tax payments? The federal income tax system is a pay-as-you-go tax system. That means you pay taxes as you earn income throughout the year. If you are an employee of a company, you pay taxes through withholding from your paycheck. If you are self employed, you pay taxes by making estimated tax payments. **End Summary** Topics: income tax]]> estimated tax]]> estimated tax payments]]> quarterly taxes]]>]]> About the Author: ]]> Kristine A. McKinley, CPA, and CFPÃÂ®, offers financial and tax planning on an hourly, fee-only basis. She specializes in helping eBay sellers and online business owners understand and minimize their income taxes. => Website - http://www.squidoo.com/ebaytaxtips/ => Special Report 'Tax Tips for eBay Sellers' http://beaconfinancialtips.typepad.com/ebaytaxtips/2007/02/free_special_re.html

Tax Issues for eBay Sellers and Online Businesses

Mon, 28 May 2007 00:00:00 -0400

If you sell on eBay, or if you have an online business, listen up. There are several tax issues in the news right now that could have a huge impact on the way you do business. The first issue, and the one that is getting the most attention, is Congress's push to get the IRS to force brokers (companies such as eBay and Amazon) to report personal data on their customers. In this proposal, brokers (such as Amazon and eBay) would be required to report names, addresses, and gross proceeds of each customer that completes more than 100 separate transactions and generates more than $5,000 in gross proceeds each year. Most likely, companies will report this information for all of their customers because they won't know who will meet the criteria above until the end of the year. This proposal could cause problems for smaller companies. Not only will collecting this information be costly, but smaller companies may not have the technology to keep this data safe from hackers. The Center for Democracy and Technology is concerned about the safety of the personal data collected, and rightly so, given how much fraud and identity theft takes place today. **End Summary** Topics: ebay tax]]> ebay sellers]]> sales tax]]> internet tax]]> online sales tax]]> income tax]]>]]> About the Author: ]]> Kristine A. McKinley, CPA, Certified Financial PlannerÃÂ®, and founder of Beacon Financial Advisors, teaches individuals and families how to invest and plan for retirement, college, and other financial goals. Kristine offers financial and tax planning on an hourly, fee-only basis. For more information on eBay taxes, sign up for our free special report 'Tax Tips for eBay Sellers' or visit our website. => Special Report 'Tax Tips for eBay Sellers' http://beaconfinancialtips.typepad.com/ebaytaxtips/2007/02/free_special_re.html => Website - http://www.squidoo.com/ebaytaxtips/

What Taxes You are Responsible for as an eBay Seller?

Sat, 10 Mar 2007 00:00:00 -0500

There are three types of tax that you will be responsible for when you start your eBay business. They are 1) sales and use tax, 2) payroll tax and 3) income tax. Sales and use tax - Just about every state, and many cities and other local authorities, imposes a sales tax on items sold. Each state has different rules, so it's important to find out the rules in your state and city. As a seller, you are responsible for collecting and remitting the proper sales tax to the state you live in. You are also responsible for preparing and submitting a report detailing the amount of your sales and the sales tax collected. You may also be subject to use taxes. This is taxes on goods you purchased out of state that you did not pay sales taxes on. The use tax generally applies to items purchased out of state which would have been subject to sales tax if the purchase transaction had taken place in state. The use tax came about from the concern that purchasers could avoid paying a state's sales tax by making their purchases outside the state. **End Summary** Topics: income tax on ebay sales]]> ebay tax]]> ebay sales tax]]>]]> About the Author: ]]> Kristine A. McKinley, CPA, Certified Financial PlannerÃÂ®, and founder of Beacon Financial Advisors, teaches individuals and families how to invest and plan for retirement, college, and other financial goals. Kristine offers financial and tax planning on an hourly, fee-only basis. For more information on eBay taxes, sign up for our free special report 'Tax Tips for eBay Sellers' or visit our blog .

Retirement Plans for Solo Entrepreneurs

Mon, 06 Mar 2006 00:00:00 -0500

Copyright 2006 Kristine McKinley Saving for retirement is even more important for solo-entrepreneurs because you don’t have a company sponsored pension plan or matching 401K contributions to rely on. There are many retirement plans available to self employed individuals and small businesses. Which one is right for you? Here is just a sample of the retirement plans available to solo-preneurs and small businesses: Roth IRA – although this is not just for solo-preneurs, this is the first place you should look to save if you are just starting to save for retirement (or resuming to save after starting a business). Roth IRAs are low-cost, very flexible, and allow you to grow money tax-free as long as you follow the distribution rules. Contributions can be made up to $4,000, and can be withdrawn at any time without tax or penalty (earnings withdrawn may be subject to penalty and tax if withdrawn before age 59 ½ and certain other conditions are not met). **End Summary** Topics: retirement]]> retirement planning]]> financial coach]]> financial planner]]> financial planning]]>]]> About the Author: ]]> Kristine A. McKinley, CFP, CPA, and founder of Beacon Financial Advisors, teaches individuals and families how to invest and plan for retirement, college, and other financial goals. Kristine offers financial and tax planning on an hourly, fee-only basis. To sign up for free financial planning tips, worksheets, checklists and more, visit http://www.beacon-advisor.com

Five Steps to a Comfortable Retirement - Without Winning the Lottery!

Tue, 28 Feb 2006 00:00:00 -0500

Copyright 2006 Kristine McKinley You’ve probably heard about the Nebraska meatpackers who won the largest lottery jackpot in the United States last week. One winner replied “I’ve been retired for about four days now” when asked what he would do with his winnings. His response did not surprise me; I’m sure my reaction would be similar! What does surprise me is that many Americans believe that they cannot retire comfortably unless they win the lottery. A survey by the Consumer Federation of America shows that 27% of Americans believe that their best chance to gain $500,000 in their lifetime is to win a sweepstakes or lottery. Fortunately, building a comfortable retirement nest egg is easier than you think. Here are five steps to help you build a comfortable retirement: 1. Start early! If you started saving $100 a month beginning at age 18, you would have over $500,000 by age 65. The power of compounding is great, and the earlier you start saving, the greater the benefit. The easiest way to get started is to enroll in your company sponsored retirement plan. **End Summary** Topics: retirement]]> retirement planning]]> financial planning]]>]]> About the Author: ]]> Kristine A. McKinley, CFP, CPA, and founder of Beacon Financial Advisors, teaches individuals and families how to invest and plan for retirement, college, and other financial goals. Kristine offers financial and tax planning on an hourly, fee-only basis. To receive free financial planning tips, worksheets, checklists and more, visit http://www.beacon-advisor.com

Top 5 Overlooked Tax Deductions

Thu, 16 Feb 2006 00:00:00 -0500

Copyright 2006 Kristine McKinley How many times have you done your taxes, and a week or a month later realized you forgot a deduction? The tax law is very complicated, so it’s easy to miss a deduction or two. In my experience, these are the top 5 missed deductions. 1. Non-Cash Donations Did you clean out your closets this year? Chances are you donated those items to Goodwill or a similar non-profit organization. The value of donated items (clothing, furniture, etc.) is deductible. You will need to get a written receipt and assign a value to these items, but the tax savings are worth the effort. 2. Points on Refinancing With interest rates so low the past few years, there have been a record-number of houses refinanced. If you refinanced, you may have paid points to get a lower interest rate. These points are deductible over the life of the new loan. In addition, if you incurred points on an old refinancing, any unamortized points are deductible in the year of the new refinancing. 3. **End Summary** Topics: income tax]]> tax deductions]]> tax planning]]>]]> About the Author: ]]> Kristine A. McKinley, CFP, CPA, and founder of Beacon Financial Advisors, teaches individuals and families how to invest and plan for retirement, college, and other financial goals. Kristine offers financial and tax planning on an hourly, fee-only basis. To sign up for free financial planning tips, worksheets, checklists and more, visit http://www.beacon-advisor.com .