t and use it to pay all of your business expenses. If you are ever audited, this shows the IRS that you treat your side business as a real company, with all the bookkeeping that goes with it. If you have a ‘trading as’ name, your bank will most likely reqCongratulations on deciding to be your own boss. Remember these three key points and you will be on your way to a good start in your new home-based business.

Keep business & personal receipts separate.

Open a credit card in your business name and use this for business, not personal expenses. If you are a sole proprietor and not using a ‘trading as’ name, pick one of your credit cards that you will use for business purposes only. Don’t mix business and personal charges on any of your credit cards. Even if you are shopping, and have items in your cart that are business purchases, have the cashier ring two separate sales so you can charge one to your business card and the other to your personal card. While the people in line may give you dirty looks, you can console yourself with the fact that you are making purchases that will help reduce your taxable income, while theirs probably are not.

Open a separate business checking account.

Deposit all checks from your customers into this account and use it to pay all of your business expenses. If you are ever audited, this shows the IRS that you treat your side business as a real company, with all the bookkeeping that goes with it. If you have a ‘trading as’ name, your bank will most likely requ

and use this for business, not personal expenses. If you are a sole proprietor and not using a ‘trading as’ name, pick one of your credit cards that you will use for business purposes only. Don’t mix business and personal charges on any of your credit cards. Even if you are shopping, and have items in your cart that are business purchases, have the cashier ring two separate sales so you can charge one to your business card and the other to your personal card. While the people in line may give you dirty looks, you can console yourself with the fact that you are making purchases that will help reduce your taxable income, while theirs probably are not.

Open a separate business checking account.

Deposit all checks from your customers into this account and use it to pay all of your business expenses. If you are ever audited, this shows the IRS that you treat your side business as a real company, with all the bookkeeping that goes with it. If you have a ‘trading as’ name, your bank will most likely req

ds. Even if you are shopping, and have items in your cart that are business purchases, have the cashier ring two separate sales so you can charge one to your business card and the other to your personal card. While the people in line may give you dirty looks, you can console yourself with the fact that you are making purchases that will help reduce your taxable income, while theirs probably are not.

Open a separate business checking account.

Deposit all checks from your customers into this account and use it to pay all of your business expenses. If you are ever audited, this shows the IRS that you treat your side business as a real company, with all the bookkeeping that goes with it. If you have a ‘trading as’ name, your bank will most likely req

s, you can console yourself with the fact that you are making purchases that will help reduce your taxable income, while theirs probably are not.

Open a separate business checking account.

Deposit all checks from your customers into this account and use it to pay all of your business expenses. If you are ever audited, this shows the IRS that you treat your side business as a real company, with all the bookkeeping that goes with it. If you have a ‘trading as’ name, your bank will most likely req

t and use it to pay all of your business expenses. If you are ever audited, this shows the IRS that you treat your side business as a real company, with all the bookkeeping that goes with it. If you have a ‘trading as’ name, your bank will most likely require you to open a business account. However, if you use your name as your business, you can open a new personal account and save on the bank service charges you would be charged for a business account.

Apply for all business licenses that pertain to your business.

If you operate a home-based business, be sure to obtain any licenses that are required from your local government. Check your state’s website for information regarding any legal aspects regarding opening and operating your business. You want to make sure you are fulfilling all legal requirements for a home-based business- if you have any questions, be sure to seek the advice of an attorney.

© 2007 Kathy Swann