Two Rules to Beat IRS at Their Own Game

You have filed your taxes and IRS sends you a notice asking you to explain certain deductions -- No Problem; IF you have followed the rules:

Rule #1 - The burden of proof of your deductions are on you.

Rule #2 - If you keep good records with receipts, notes and invoices -- you win!

Its that simple.

However, If your Tax Professional, or you have placed incorrect amounts on the tax return -- and IRS ask for clarification -- you may have a problem. How serious the problem becomes, depends on the "IRS Human's" interpretation of how the error occurred. The "IRS Human" usually will request proof of your deductions. Of course, if you do not have proof and there is no evidence that the figures are anywhere near correct -- you might be looking at a fraudulent return status.

It does not matter that your Tax Professional put the numbers on the tax return -- What matters is that you signed the tax return.

The bottom line is; Do not allow Tax Professionals to put incorrect information on your tax return. You are responsible for YOUR return.

Many Tax Professionals will help clients with a "best guest estimate" for example, you have a cell phone and the phone was turned on and available for business use 12 months out of the year. You do not know the exact amount of the cell phone bill paid each month. Your tax professional may take the base of your monthly bill and multiply by 12, and add a small amount for additional minutes used --- this may or may not be OK with IRS -- however, more then likely they won't question the deduction, if it is within reason.

Suggestions on how to win the Record-Keeping Game are as follows:

1. Slow down, pay attention to details when it comes to tax deductions

2. For business expenditures; pay by check when possible

3. Keep recites and invoices in a safe place

4. Track all business mileage (Write down date, beginning mileage, ending mileage, clients visited and/or nature of business)

5. Use a credit card or ATM for ALL travel, entertainment and Business Gifts ($25.00 limit on business gifts)

6. If you must use cash to pay for an item or a service; put a note in your recite drawer stating what you paid, when and how much)

7. When traveling away from home on business; keep a log of your expenses. (especially cab fares and tips)

8. Keep track of dues for professional organizations such as business league, trade associations, cambers of commerce, boards of trade and real estate boards.

9. Don't forget to keep records of your cost for your ISP (Internet Service Provider) , email campaigns, online marketing cost, PPC (pay per click cost) and web design.

10. If you Factor your Accounts Receivables, get a business loan or line of credit, or cash advance for your retail business, remember that ALL fees associated with these loans/transactions are tax deductible.

Example of Excellent Record Keeping:

You are traveling on business. It cost you $32.50 round-trip for the cab fare to a business meeting from your hotel, on one day and $27.00 for cab fare the next day for a different meeting -- You tipped the bellman $2.00 each time he ordered a cab for you. (Yes, you could stay in a hotel that is closer to the meeting, but you would rather stay downtown) This is a $59.50 legal deductions that many people forget about, because it was not on paper. Lets say this happens four times a year; same meeting, same hotel. $59.50 X 4 = $238.00; is the deduction that you may forget; if you don't keep notes.

Cassandra Ingraham is a Tax Accountant and Instructor for Basic Tax Classes in the San Francisco Bay Area. During the balance of the year she can be found at http://www.taxeswilltravel.com providing Formal Introductions to Lenders for Accounts Receivable Funding (Factoring) and Purchase Order Funding.

Single Moms Recovery From Bad Credit

There is a public perception that having bad credit means you are an irresponsible bad person. For single mothers this boils down to the impact of their circumstances in life. Regardless of circumstances single moms have to start building credit to gain the purchasing power to buy cars, homes and a comfortable lifestyle.

Being a single mother is a juggling act, but loans for single moms with bad credit are available. Care has to be taken that wherever the money comes from its acquisition must be weighed against the future. There are loans and grants available to pay the electric bill or the car repair bill. Although these are helpful, rarely will you find temporary relief for important things like diapers and other essentials. Again, when the emergency arises, the best thing to do is weigh your options and make an informed decision.

Car Loans

Fortunately, getting a car loan is very easy nowadays if you have bad credit or no credit. However, the auto industry is struggling and many American companies are willing to overlook bad credit just to get a car off the lot. The price you pay is a high interest rate loan. The cost of the car may be far more than it is actually worth. However, if you need transportation and think your situation is temporary, buy the car and refinance the loan later with a better rate. However, it is better to get a cheap reliable car, then get in over your head and lose out on the chance to improve your credit.

Housing Assistance and Repair

The Department of Housing and Urban Development offers loans to help with buying a house, and also covers major repairs like roofing, plumbing and general maintenance. They work with all types of buyers with poor credit, delinquencies and low-income. If the emergency is a home repair this is the best place for single moms with bad credit to get loans. Granted it may not be easy but you have to persevere.

Payday Loans

Generally these loans should be your last option because they are the worse. The interest rate can climb as high as 1800 percent of the original loan. And late fees apply to missed payments as well. These types of loans should be avoided at all cost. However, they remain a popular alternative because they do not require credit checks. If an emergency requires a payday loan, be aware that missing payments rack up substantial fees and the repayment may equal two to three times the original amount when all is said and done.

How does this brief article help you if youre strapped for cash and have run out of options? Regardless of your current situation you must keep an eye on the future. Dont get yourself into a financial jam if youre already in a financial jam. Remember, if you havent got the money, dont write the check. If you have to borrow, it becomes more difficult to pay it back, because you were strapped before you borrowed. Learn to crawl before you walk. Sacrifice a couple of years beginning today and your tomorrow will be brighter than you ever imagined.

Joel Williams has written several books and articles for single moms. Check out his website at http://singlemomachievers.com/assistance for information, resourceful articles, parenting tools and audios plus methods you can use to become the Mom you intended to be from the start. There is a FREE report to help you get started, "Your 7 Day Personal Program For Taking Back Control Of Your Life As A Single Mom! "