How Mental Health is Being Addressed in the Construction Industry →

In an industry that can be deadline-oriented in the best of times, the pandemic and nationwide supply chain shortages have compounded stressful conditions for many of your construction clients and their employees. 

Workers are stretched thin. They’re concerned about their livelihoods and ability to provide for their families. Longer job hours and back-to-back jobs increase injury risk—and Covid-19 remains a threat. 

But there is hope. More companies are providing resources to help employees so they can better manage stress. Conversations are happening that encourage workers to tell someone when they’re not coping well. It takes time and intentionality, but change can happen. 

It’s important to examine what the construction environment looks like today. Then, solutions can be discussed on how employers can help their workforce stay mentally and physically healthy. Mental health awareness must come from the top down and be taken seriously by management. By implementing the right steps today, the future of employee well-being looks much brighter for your construction clients. 

The State of Mental Health in Construction 

Nearly two years after the onset of the COVID-19 pandemic, construction workers are as busy as ever.

Residential homebuilding is in a market frenzy. Its commercial counterpart faces supply chain problems that drive up building costs and make meeting deadlines more challenging. Labor shortages put excessive stress on employees to do more work in less time. 

These factors mix into a field that has one of the highest suicide rates of any industry. A 2020 CDC press release stated the suicide rate for men in the construction industry is almost twice the total suicide rate for working men in other civilian sectors. 

Every day, many workers are battling a mental illness that’s eating away at them, often without anyone else knowing there’s an issue. 

But, the world is changing. Mental well-being conversations are normalized instead of taboo. 

Companies are seeing the importance of providing resources to employees to manage their mental health and stress levels. 

“It’s an important part of what they [an employer] need to bring to an employee,” said Pam Guttman, Senior Safety Specialist at Safesite. 

Supporting employees’  mental health will lead to healthier lives and drive long-term retention. A better mindset on the job site can help reduce the number of physical injuries. 

How Contractors Can Help Employees

Mental health resources and conversations are common in white-collar work environments. But construction is unique for myriad reasons. There is an assumption that construction workers are “tough” individuals and therefore it can be difficult identifying who might need help if employees don’t self-present. For this reason it is even more important that managers stay vigilant.

“You’re always holding a lethal weapon when you’re working in construction,” said Guttman. 

The dangers of daily tasks alone can put a strain on the mental fortitude of workers. According to Guttman, a small break from the grind of the job can have the most impact on a worker’s mental health. 

It all starts with a conversation, preferably at a tailgate or toolbox meeting. Supervisors need to address mental health and offer resources to workers. Make it a regular part of their daily meetings. 

Next, have your client implement tangible rewards and actions related to employee stress: 

• Build-in time for breaks (in shady areas if it’s hot) to give employees a mental and physical pause from their current tasks

• Bring food trucks or offer on-site meals and snacks on days when there are safety meetings and mental health discussions

• Encourage time away with family, such as outdoor outings or movie nights at home with snacks and treats

Small investments in employees’ lives demonstrate an employer cares about them. What may seem insignificant can give someone a break and get their minds away from a problem at exactly the right time. 

Making Mental Health a Management Priority 

Mental health isn’t measurable like near misses or fall injuries. As a result, it’s hard for leadership to see the impact of mental health on their crews. 

But, to continue changing the perception of mental health, construction managers must make it a priority. 

Workers should feel okay and comfortable speaking with someone about their mental health struggles. 

Something tangible employers can do is offer programs and benefits that help employees lead healthier lives, such as: 

• Wellness programs to encourage physical activity, which improves mental health

• Employee assistance programs with access to mental health professionals

• Implementing a reward system for positive behaviors

When people feel good about themselves, they’ll appreciate their employer. An important part of this relationship is building trust with an employee. Communication is essential to trust. 

In updated guidelines for construction firms, the CDC recommends discussing how the pandemic affects jobs and what’s going on in the company. When employees know what’s happening, it eases their stress. 

Resources for Managing Stress on the Job-Site

On every job site, an employer should be their employee’s advocate. Managing the stress level in construction is dictated mainly by the interaction between managers and workers. 

Prepare templates or utilize technology that helps managers lead mental well-being conversations during meetings. 

Identify leading indicators that suggest someone is struggling and encourage them to take a break or step away during moments of increased stress. 

What the Future Looks Like 

In every industry, mental health is increasingly a normalized topic. Business leaders, HR staff, and safety managers recognize the need for support.

“The more we can be proactive in planning to work on that, the more we’ll be able to work on the mental health for everybody,” said Guttman. 

Safety technology will play a significant role in reducing incidents but also helping foster the mental health conversation.  

OSHA and other organizations, like the Construction Industry Alliance for Suicide Prevention (CSAP), provide resources to help employers and construction workers address mental well-being and, as a result, lower suicide rates. 

There are many positive indicators in the construction industry that suggest mental health will be a priority. As more and more construction industry firms address it and offer support, we will see employees live more fruitful lives and not struggle in silence. 

Writing Copy for Bela Family Dentistry's Careers Page→

I worked with the Bela team to write new web copy for their careers page. These folks aren’t looking for just anybody. They want people who are passionate about patient-centered dental care. So we wrote a page that attracted that kind of talent. Someone who wants a different career path in the dental field.

After a few conversations with folks who already loved working at Bela, I started slinging copy. You can check out the final product right here.

Foresight-Guiding Your Clients Through Workers Compensation Claims→

Do you know the true cost of inaction? It’s more than you think.

Your client’s costs can increase by 51% if they do not report a workers compensation injury in good time. For even the largest of companies, this can be a devastating mistake. 

The increased claim cost demonstrates the importance of having a defined process of reporting and managing claims. The process protects workers, customers, and the company by helping employees deal with injury and get back to work healthy. 

As their broker, you can guide clients through the logistical details of workers comp claims. And trust us, the details are essential. 

Expect Unexpected Incidents

The most crucial step happens before an accident takes place. It’s the time your client sets aside to educate their managers and employees on what to do when an injury occurs. They need to understand who to contact and how to assess the situation. 

The company guide to handling a workers comp claim should be included in their safety management plan.  If your client does not have a plan in place, help them develop one. Every employee needs to understand the steps to take after an accident to ensure the process runs smoothly. 

Streamline Incident Response  

When an injury occurs, employees need to notify the appropriate designee in their company. The designated person may be HR, a safety team, or a supervisor. Workers must determine if first aid or more serious medical care is required and whether to notify an employees’ emergency contact. If there’s a risk of other injuries, the workspace needs to be vacated until it is safe for others. 

Your role as a broker is to begin working with your client’s carrier once you learn of an incident. 

The carrier needs to be notified within 24 hours so they can begin the claims process. Keep in mind that the carrier will want to speak with employees who have first-hand knowledge of the incident as soon as possible. After all, memories often lapse or details disappear even after a short time.

There is often a tiny window of time to report an accident; some states require a claim in as few as seven days. The length of time it takes to initiate the process will have a very real impact on the claim’s cost. You can save your client money by advising them through the process. 

Build and Use Your Relationships 

If you’re reading this, then you are an insurance nerd — it’s okay, so am I. A claim is a perfect opportunity for you to help your client by using your knowledge and relationships. 

The workers comp process is very stressful. You can mitigate much of this work by speaking directly with the carrier. You’ll be able to sort through much of the insurance language that your client will not understand. 

Knowing the right people can play an outsized role in a workers comp claim. Having a relationship with a physician will allow your client to send employees to receive treatment right away. A medical expert who understands the business and the types of typical injuries can make the experience much better for the company and employees. It will reduce potential high costs associated with going to walk-in clinics or other physician’s offices. 

However, if there is an emergency, the employee should always go to the closest available treatment center. 

In some circumstances, it may be beneficial for your client to hire a workers compensation attorney. Have a list of firms you know and trust that can represent your client. If an employee sues or seeks additional funds, your client will need good representation to make sure they manage the situation correctly and follow state law. 

Complete the Injury Report 

If your client doesn’t have their own accident/near miss form, they need one. Depending on the carrier or state’s requirements, the injured employee may need to complete this, or a representative from the company will have to meet with them to fill it out. 

If the employee is hospitalized or at home, you can visit and gather details the carrier will need. A face-to-face prevents a back and forth conversation where the provider must try to piece together what happened with limited context. 

After this is submitted, the claim can begin, and more importantly, the employee can look forward to benefits to replace lost wages. 

Assist with the Investigation 

Each workers compensation incident requires an investigation to determine its validity. Fraudulent claims rarely get approved, but when they are, they tend to be very expensive. Statistics show that fraud in workers comp costs roughly $30 billion annually. 

As a third party, you can help your client assess what happened and discuss the details with those who witnessed the injury. 

Mine the Details with the Insured and Carrier 

While the claim progresses, you’ll want to stay in regular contact with the carrier. Work closely with your client’s designee (HR, safety, etc.). If the carrier needs to speak with an employee or supervisor, arrange these conversations. 

Ensure your client tracks details like the time and date of the incident and the number of days lost. This information will determine the amount of money paid for the benefit. 

Offer Advice on the Return to Work Plan 

It’s beneficial for the client and employee to develop a return to work plan. Even if it’s a light-duty role, it prevents your client from hiring someone temporarily and investing time and money to train them, and it reduces the cost of a claim by helping employees get back to work sooner. 

Partner with your client and the other professionals involved to develop a well-documented return to work plan. Many potential factors can affect how and when an employee can come back to the job. A doctor may recommend the employee work only on restricted assignments. 

You may need to have a conversation with your client about the Family and Medical Leave Act (FMLA) and how the law can impact their return to work plan. If the employee is eligible and elects FMLA leave, the employer cannot penalize them for choosing this option. They can, however, restrict their access to workers compensation benefits.   

There may come a time when your clients will want to discuss termination options. It’s important to include input from legal professionals early in these discussions. The Americans with Disabilities Act (ADA) and some state laws prevent the termination of employees who are absent due to a work-related injury except in limited, defined circumstances. 

Identify Points of Exposure in Coverage

Looking for blind spots in your client’s coverage can protect your clients. As workers comp has changed over the years, they may face exposure to additional costs. In some cases, employees can sue using intentional tort, which places the blame for an injury on the employer, citing the action that leads to the incident was deliberate or intentional. 

Most workers compensation policies and general liability exclude intentional acts. If a situation like this goes to trial, your client may not have the policy to cover defense costs.

Prepare Your Client for New Types of Claims 

Stressful periods cause many employers to see an uptick in mental illness-related workers compensation claims. Between a pandemic and turbulent economic and cultural events, employees have a lot on their plate. They may fear job loss or a furlough. Budget cuts to cope with turbulence may also mean they may have increased job responsibilities without increased benefits or pay. 

If the stress becomes too much, they may file a workers compensation claim for lost time due to stress. The regulations and parameters around such claims vary by state. Many times an employee will have to identify a specific event that leads to mental illness. 

Streamline the Claims Process 

The workers compensation process is messy. There’s a lot of paperwork and many interested parties who each have their own agenda. One thing is simple: your responsibility to provide the best service possible to your client beyond the written policy.

The claims process is a top way to maximize your impact. Add in the right carrier and technology, and you’re on your way to tackling complex problems with ease and freeing up time for new business.

Foresight employs risk management technology to reward employers for good safety practices with lower premiums. A stronger risk management program translates to improved safety and fewer claims.

You can be the one who offers the advice and direction to get them through a claim. Reference our appetite guide to see if your clients are the right fit for Foresight. 

Leading the Pack with Web Copy (Greenville Pickens Speedway)

Look, I’ve been to a few races. They’re fun. I mean seriously, it’s a good time. I wanted people who’d never been to a race, or to Greenville Pickens, to know what it feels like to walk into the grandstands. To smell the fuel, burnt rubber, and boiled peanuts. Sound like a weird combo? It is and there’s nothing else like it in the world.

I love history. When I sat down to write the copy for this page, I knew it was important to the track owners that we capture the history of Greenville-Pickens Speedway.

A lot of big names have raced at Greenville Pickens Speedway. The journey to the big stage started right here and we wanted fans to know this.

Greenville Pickens Speedway is the ultimate family entertainment event. Visitors to the site needed to know there’s something going on year round at the track, even if its not racing.

LessAccounting: Sole Proprietorship Taxes Simplified →

Tax deductions are your friend

There’s a lot of complicated and conflicted information out there.

Between the IRS website and the sites with a bunch of ads, it is so difficult to understand what it is that a sole proprietor needs to do to understand the tax implications of running their business.

That’s why we decided to create this guide – no ads, no fluff, or technical terms just straight to the point information that is easy to understand.

Do we have your attention? 

Good. 

As a sole proprietor, you are looking for any way to cut expenses and add to your bottom line. 

We get it. So let’s talk about sole proprietor tax deductions. 

Here’s the short story: more deductions = fewer taxes. 

Now that you’re excited let’s read on!

Other than rent and payroll, sole proprietorship taxes will be one of your largest expenses each year. According to the balance small business, sole proprietorships face a 13.3% tax rate.

It’s in your best interest as a sole proprietor to use and maximize the tax deductions. They’ll lessen your tax burden, allowing you to invest that money in your business.

Filing taxes as a sole proprietor isn’t easy, but don’t worry. We’re here to help. 

First off, we’ll walk through the basics of an IRS sole proprietorship and how it is taxed. Then, we’ll be going in-depth on several tax deductions you need to know about and how to take advantage of them. 

How do I know I am a sole proprietor?

Great question. It’s important to establish if you are a sole proprietor to determine your tax obligations. This is necessary so you can calculate your deductions!  

A sole proprietorship is not limited to a specific industry. In its most basic form, a sole proprietor runs and operates their own business. It is not established as a legal entity, therefore all the financial and legal obligations fall upon the owner. 

Even if you do projects as an independent contractor for one or two firms, it’s very likely you are a sole proprietor. Typically, companies do not withhold taxes from an independent contractor’s wages. If no one is withholding your taxes, most likely you’re a sole proprietor. 

The beauty of being a sole proprietor is the simplicity of setup. It’s by far the easiest company to start because essentially, all you need is yourself and a skillset. To give you some ideas, here is a sample of a sole proprietorship business: 

• Computer repairs services 

• Freelance writing or graphic design 

• Landscaping or lawn company 

• Photography

Do sole proprietors pay quarterly taxes?

If you’re new to working for yourself, there will be some familiarity with how your taxes work.

Like most W-2 employees, you’ll have to file your sole proprietorship taxes annually (usually April 15th).

One major difference is the payment of quarterly estimated taxes. These are made each quarter to help satisfy your tax obligations since you do not have an employer taking this money out of your paycheck.

If you work with an accountant, they can help you determine your sole proprietor taxes for each quarter. 

To make accurate payments, you’ll need to know your net profit or loss. The IRS requires payment on any net income above $400 earned each year.

How does a sole proprietorship pay taxes?

Now that you know you’re a sole proprietor, it’s important to start thinking about taxes. We know this isn’t the most fun topic.

We’re going to break it down and help make the process a little easier. 

The easiest way to pay your sole proprietor taxes is to visit the IRS website and pay electronically. You can use either your bank account, a debit or credit card. By using your bank account, you can schedule payments in advance. Those paying with debit or credit card also have the option to call and make a payment. 

You can send a check, although online is the quickest option.

If you’re unable to meet your tax obligation, you can set up a payment plan. Note that this may include interest and late fees. 

Don’t forget to check out your state’s Department of Revenue site. They manage state sole proprietorship taxes and that is where you will need to make your state payment. While you may owe fewer state taxes than federal, it’s important to take care of it.

Do sole proprietors charge sales tax?

The answer depends on the type of business you operate. According to the balance small business, sole proprietors do pay sales tax on goods and products they sell. So if you’re running a flower shop or online store, you’ll be required to pay state taxes on the goods you sell. Your tax rate will vary based on the state you live in. 

If you’re a writer or graphic designer, you won’t have to pay sales taxes on your services but you will owe state sole proprietorship taxes on the revenue you earn.

How does a sole proprietor get a tax refund?

A sole proprietor’s best chance of getting a refund is overpaying on your quarterly estimated payments. By paying more than what you believe you owe, you increase your chances of receiving a refund once you file your return. 

As stated in the balance small business, if you do pay extra in hopes of a refund, you forego the opportunity to use that money elsewhere throughout the year.

What can you write off as a sole proprietor?

Now for the good stuff. Let’s talk about the deductions you can use when filing taxes as a sole proprietor.

You may have a lot of questions, like, “how much of my phone can I claim on my taxes?” or “Can you write off a home repair?”

IRS sole proprietorship guidelines go through each of these. But, to save you some time (because we know how precious that is as a business owner), we’ve put together a list of important deductions you need to know about. Using this will help you reduce the burden of your sole proprietor taxes.

Are startup costs tax-deductible?

At this point, you’re well aware that starting a business is a challenge.

And it’s expensive.

Fortunately, you can deduct some of your startup expenses. The IRS will allow claims of up to $5,000 in your first year of operation. These costs vary but include advertising, travel, and fees associated with professional services or consultants. 

The IRS recommends treating all your startup costs as capital expenses. While you can deduct interest and taxes in some circumstances, they cannot be deducted as startup costs on your sole proprietorship taxes. 

Costs of getting your business started

A sole proprietorship has one of the lowest barriers to entry for starting up. But, like any business, you will invest some money to get your idea off the ground. Many of these expenses can be deducted from your sole proprietor taxes. 

Most businesses need a website. Whether you build the site yourself or pay an expert, there are costs associated with getting a site launched. You need to register a domain name, build out landing pages, and more. Each of these items has a cost. The great news is you can deduct each as a business expense on your sole proprietorship taxes.

Even after your first year of business, as long as you use that site for your work, you can continue deducting the costs of your website.

Depending on the technology, you can have deductions on things like printers and computers.

You have the option, under Section 179, to write this off the year of purchase, or over several years. Software purchases can qualify as well.

This does not include personal items. Sorry, no deduction for playing Minecraft. 🙂

Depending on your industry, you may want to invest some money in advertising. This could be anything; digital, print, or podcasting. The costs of placing an ad can be deducted on your sole proprietor taxes. 

Continued education

Maybe you want to take a few classes to broaden your skillset.

You can deduct the cost of your own education. Classes that maintain or improve skills in your current field can be deducted.

You need to be able to show that the knowledge you gained maintains or improves the skills required by your job.

Taking a cooking class if you’re an accountant is probably not going to qualify as deductible (but it may save you money on client dinners).  

Deductions for your health insurance

You’ve likely purchased health insurance through a private carrier or the Healthcare Exchange.

In most situations, you’ll be able to claim a deduction on any health, dental, and qualified long term care insurance you’ve purchased.

This can include you, your spouse, and any dependents. Not only are these good investments, but they are a great deduction on your sole proprietorship taxes.

Writing off Social Security and Medicare taxes

For most W-2 employees, their employer manages the deduction of Social Security and Medicare from their paycheck.

As a sole proprietor, you’ll have to take care of this on your own. You can claim a deduction of 50% on your quarterly social security and Medicare payments made throughout the year.

Retirement Plans

Contributing to a retirement account is a no brainer. As a sole proprietor, it’s even more important to stay on top of your savings. The IRS allows you to deduct some of your contributions on your taxes. 

Let’s take a look at two of the more popular plans and their impact on your sole proprietorship taxes. 

• Roth IRA: Contributions to a Roth IRA account are not deductible. 

• Traditional IRA: You’re allowed to take a full deduction of your contribution if you or your spouse (if you’re married) are not covered by an employer retirement plan. 

The rules get a little tricky with sole proprietor taxes. The deduction can vary based on the plan you choose and if you contribute to an employee’s plan. 

The IRS has an entire page dedicated to self-employed retirement plans. It includes the various deduction possibilities for each retirement plan, from 401Ks to Roth IRAs.

It pays to work in your PJs

It’s very likely in our current environment that you’re working from home. Maybe that’s always been your office. Since you use this space for a business, it can be claimed as a deduction. The IRS uses two methods for home office deductions: the Simplified Method and the Regular Method. No matter which you choose, there are two basic criteria: Your home office needs to be your regular place of business and be exclusively used for these purposes. It is your principal place of business.  We’ll answer the questions of how to calculate home office appreciation and deduction.  If you have a home office, or room that is used as such, this will qualify as a space that can be deducted. If you’re working out of your kitchen or dining room, things may get a little trickier since you do other activities there.  Maybe you’re a road warrior or also use a co-working space for client meetings. This is perfectly fine, as long as you still do substantial business in your home and calculate it accordingly.     

• Simplified Method: 

  • This became an option in the tax year 2013.  

  • While it does not change the criteria of qualification, it simplifies the calculation.  

  • The standard deduction is $5 per square foot (up to 300 sq. feet). 

  • Certain expenses may qualify such as mortgage interest and real estate taxes.

  • This method keeps it simple by reducing the amount of record-keeping. 

• Regular Method: 

  • If you go the regular route, you’ll have to determine each expense associated with your home office (utilities, mortgage interest, insurance, etc.) 

  • Instead of cost per square footage, the deduction is calculated on the percentage of your home devoted to business usage. 

  • Using the regular method, you may be able to claim direct and indirect expenses on your taxes. 

Here’s a full list of allowable deductions from your home office: 

• Rent 

• Casualty losses 

• Mortgage interest 

• Insurance 

• Utilities 

• Depreciation 

• Maintenance & repairs 

These write-offs typically fall into two categories; they are either direct or indirect expenses. Direct expenses are related exclusively to the business area of your home, so repairs and maintenance to your office would qualify as a direct expense. These are typically fully deductible.  Indirect expenses relate to your entire home. Things like insurance and utilities are indirect because you utilize them for both business and personal use. You’ll need to calculate the percentage usage of these expenses as it relates to your business to determine the allowable deduction. 

Can you really write off home repairs?

You can write off home repairs that are directly related to your home office. Maybe you built some shelving, a new desk, or applied a fresh coat of paint. These are deductible expenses. 

Unfortunately, writing off the new countertops in your kitchen will not qualify as an allowable deduction.

What percentage of utilities can I claim?

That was probably one of the first questions on your mind when you saw utilities on the list.

Since utilities in your home overlap with personal use, you’ll need to determine the percentage use of your home for business. You can use that calculation to determine how much of your utilities you can write off.

How to calculate home office depreciation?

The IRS does allow depreciation on the part of your home used for business, but you can’t depreciate the cost or value or the land. It’s important to know a few things before depreciating your home: 

• The point in time you started using your home for business. 

• The cost of improvements made before and after you started using it for business. 

• Percentage of your home used for business. 

You must know the percentage of your home that can be depreciated for business use. Then, you’ll want to multiply the percentage of your home that is used for business by the lesser of the following: 

• The adjusted basis of your home when you started using it for your business. 

• Or the fair market value when you used it for your business. 

Determining home office deduction method

If you’re wondering which method is best for you, whip out your calculator (AKA your cell phone) and do a little math. If the estimated deduction is about the same, you’ll likely save yourself some time and stress by using the simplified method.

No matter which you choose, this is one of the best deductions to claim on your sole proprietorship taxes. 

Special exceptions apply to daycares. If you use your home for the care of children, persons over the age of 65, or those unable to care for themselves, you can still use a home deduction. You need to determine the percentage of your home used for daycare. 

What if you rent?

Since we’ve talked about home office space, this may raise a question: “I’m a renter. Can I deduct rent on my sole proprietor taxes?”

The short answer is, yes. The same requirements apply to the business use of your home. 

If you rent space (an office, co-working desk, store, etc.) you can use this as a deduction. 

The IRS does have a caveat on what they refer to as “unreasonable rent.” Meaning, if you’re renting space from someone to whom you’re related, you need to pay them the same amount you would a stranger landlord. This situation typically only arises if you’re related, in some way, to the owner of the property.

Deductions for your phone

If you’re running a business, you probably wonder “how much of my phone can I claim on my taxes?” After all, it’s a big part of your operation. And cell phones aren’t getting any cheaper (like we said earlier, it doubles as your calculator). 

The IRS does not allow you to deduct the costs of the first telephone line in your home. You can deduct the expense of long-distance calls or the use of an exclusive business phone.

Deducting your mileage and travel costs

Although you may mostly work at home, or in an office, as a sole proprietor, you probably use your vehicle for business purposes; driving to meetings, conferences, business meals.

You may also use that vehicle for your personal life. If so, you’ll need to calculate the percentage usage for your business. 

Mileage can be deducted. This relates to trips outside of your normal commute or within the general area of your business and residence.

In 2019 the standard mileage rate was 58 cents per mile. In 2020 it is 57.5 cents.

Meals

Ah, the client dinner. Or lunch. Maybe coffee. Love them or hate them, these meetings can add up in cost. You can typically qualify for a 50% deduction of the costs associated with meals and entertainment. Traveling to these meetings is a separate expense and not subject to the 50% rule. 

Traveling for business is often a great time to enjoy some personal time and sightseeing. If you incur any expenses on your trip that are not related to the business (i.e. going to a sporting event or visiting a museum) then you cannot deduct those as part of your trip.

Is coffee a business expense?

If you’re a coffee-lover, you’re in luck. You can deduct your coffee expenses in certain conditions. Kiro Coffee gives a great breakdown of how to write off your coffee addiction. 

If you’re making a run to your local coffee shop for an afternoon pick me up, this is not deductible. But if you’re meeting someone there for a meeting, you can write off 50% of this cost. 

If you buy brewing equipment or coffee for use at your home office, this qualifies as a deductible expense on your IRS sole proprietorship taxes.

Depreciating assets (Codeword: Section 179)

For most sole proprietors, it’s unlikely you have a large number of assets with the depreciation that can be deducted.

Let’s touch on this briefly so we cover our bases. Beginning in the tax year 2020, you can deduct a maximum of $1,040,000.

The most likely application for your sole proprietorship is depreciation on a vehicle. A vehicle you use for work, and first placed into service in 2019, can have a maximum depreciation deduction of $10,100. 

Impairment expenses

If you’re an individual with an impairment, you may use services or tools to help you with business tasks. If the assistance is exclusively used for business, you can deduct the costs on your sole proprietorship taxes. 

Maybe you need a computer to type documents and emails and are unable to do so yourself. Purchasing a dictation software that is used for your business would qualify as a deductible expense. 

Bad debts, interest on loans, fees, oh my...

Hopefully, this doesn’t happen often, but you may have a client who cannot pay a debt they owe you. 

You can only claim a bad business debt if it was previously reported on income. 

You can generally deduct interest on loans you intend to repay. This is particularly useful if you’ve taken out a mortgage to purchase your place of business. You can deduct the expenses used to obtain a mortgage (again, if you use that property for business purposes) from your sole proprietor taxes. You can also deduct the interest you pay on the mortgage. 

If you take out a credit card for your business, you have the opportunity to claim fees as a deduction. Oftentimes these come in the form of annual fees for usage. 

Clubs and organizational fees

You may join a networking group, chamber of commerce, or trade association. These are great ways to get the word out about your services and meet other professionals. If these types of organizations are established to serve a business purpose, their fees can be deducted. 

This is an exception to the IRS’ rule that club feeds are non-deductible. Sorry, your golf course membership didn’t make the cut.  

Helping you help yourself

There are a number of things you can do to make tax season less panic-inducing: 

• Keep track of your records. Digitally, or hard copy (preferably both). Be sure you hang on to this info. Save your receipts, invoices, statements, and keep them organized. This will make it much easier to access and help you take advantage of all possible deductions. 

• Find a good accountant or bookkeeper and hire them. It’s worth the investment to make sure you file correctly and take advantage of all these sole proprietorship tax deductions. You may not be very good at maintaining records, that’s okay. An experienced bookkeeper will make your life much easier and help avoid any critical mistakes. Your accountant will appreciate the bookkeeper’s work when it’s time to file taxes. Bonus: the cost of these services is deductible.

• Keep your business and personal expenses separate. Things can get complicated if you blur these lines. The purchases you make with business income should primarily support your business activities (Hint: going out to lunch for yourself on the business account is not going to be a deductible expense). 

COVID-19 considerations

Due to the ongoing pandemic and economic crisis, the IRS has delayed the 2019 tax deadline until July 15, 2020.

Check out their People First initiative page for more information. They’re making exceptions to help during this difficult time, including payment plans and giving those who owe delinquent bills a break.

Many state governments have altered their tax deadlines, so check with your Department of Revenue for more info.

Additional resources for the sole proprietor

The IRS recently launched their Gig Economy Tax Center. It provides resources and tax help to workers who provide on-demand services. This is a great way to learn more about your tax obligations as a sole proprietor. 

Given the rise of gig jobs, IRS sole proprietorship resources have been made readily available. From ride-sharing services to online creative market places, more people than ever are earning income through side gigs. 

This type of work is generally categorized as being part-time, or temporary, and often done through digital platforms. Services like freelance writing, photography, or design work could fall into this category. Others may sell handmade goods through online marketplaces like Etsy or Uncommon Goods. 

There are tax implications for anyone who works in these fields. Whether gig work is your full-time business or just a side hustle, you’ll need to pay taxes on this income. The IRS suggests keeping track of all expenses to help lessen the burden of your sole proprietorship taxes. 

On the income side, you need to keep track of what you’re earning (this is just good business practice). Even if you don’t receive a 1099 tax form from those with whom you’ve worked, you’ll still need to report this income. 

Solopreneur doesn’t mean you’re in this alone

Tax season sends a shudder down the spine of even the most financially savvy. Many people stress about affording their tax bills or getting everything correct on their return. Filing taxes as a sole proprietor does not have to be a lonely journey.

There’s a lot of information out there, but arming yourself with a good bookkeeper or accountant will make the process much easier. 

Even if you’re capable of managing your own records, consider purchasing a reliable bookkeeping software so you have everything in one place. We can’t express enough how important it is to maintain good records for your sole proprietorship taxes. Your life will be much easier by April 15 (or July 15 in 2020). 

Practice good habits with your business income. View your taxes as a way to reduce the expenses in your business. When you’re running a sole proprietorship, taxes can be one of the few major expenses you have a direct ability to change. Rent, payroll, insurance, are all difficult to reduce. By being diligent in how you run your business, you can greatly lessen the impact of taxes on your bottom line. 

We’ve covered a lot in this article. From questions like, “how much of my phone can I claim on taxes?” to writing off your coffee habit. Keep an eye on our blog for more great tips to manage your sole proprietorship. Use these tax deductions to your advantage as you grow your business.

LessAccounting wants to help sole proprietors do what they love. This means less time sweating the details like taxes and deductions. 

Tired of doing your own books?

Schedule A Free Bookkeeping Consultation Now!

IRS Resources:

About Publication 587, Business Use of Your Home (Including Use by Daycare Providers). (n.d.). Retrieved from https://www.irs.gov/forms-pubs/about-publication-587

Easy ways to pay taxes. (n.d.). Retrieved from https://www.irs.gov/newsroom/easy-ways-to-pay-taxes

Home Office Deduction. (n.d.). Retrieved from https://www.irs.gov/businesses/small-businesses-self-employed/home-office-deduction

Publication 535 (2019), Business Expenses: Internal Revenue Service. (n.d.). Retrieved from https://www.irs.gov/publications/p535#en_US_2019_publink1000209195

Publication 535 (2019), Business Expenses: Internal Revenue Service. (n.d.). Retrieved from https://www.irs.gov/publications/p535#en_US_2019_publink10007487

Publication 535 (2019), Business Expenses: Internal Revenue Service. (n.d.). Retrieved from https://www.irs.gov/publications/p535#en_US_2019_publink1000209188

Publication 535 (2019), Business Expenses: Internal Revenue Service. (n.d.). Retrieved from https://www.irs.gov/publications/p535#en_US_2019_publink1000208843

Publication 535 (2019), Business Expenses: Internal Revenue Service. (n.d.). Retrieved from https://www.irs.gov/publications/p535#en_US_2019_publink1000208843

Self-Employed Individuals – Calculating Your Own Retirement-Plan Contribution and Deduction. (n.d.). Retrieved from https://www.irs.gov/retirement-plans/self-employed-individuals-calculating-your-own-retirement-plan-contribution-and-deduction

Topic No. 509 Business Use of Home. (n.d.). Retrieved from https://www.irs.gov/taxtopics/tc509

Tax deductions are your friend

There’s a lot of complicated and conflicted information out there.

Between the IRS website and the sites with a bunch of ads, it is so difficult to understand what it is that a sole proprietor needs to do to understand the tax implications of running their business.

That’s why we decided to create this guide – no ads, no fluff, or technical terms just straight to the point information that is easy to understand.

Do we have your attention? 

Good. 

As a sole proprietor, you are looking for any way to cut expenses and add to your bottom line. 

We get it. So let’s talk about sole proprietor tax deductions. 

Here’s the short story: more deductions = fewer taxes. 

Now that you’re excited let’s read on!

Other than rent and payroll, sole proprietorship taxes will be one of your largest expenses each year. According to the balance small business, sole proprietorships face a 13.3% tax rate.

It’s in your best interest as a sole proprietor to use and maximize the tax deductions. They’ll lessen your tax burden, allowing you to invest that money in your business.

Filing taxes as a sole proprietor isn’t easy, but don’t worry. We’re here to help. 

First off, we’ll walk through the basics of an IRS sole proprietorship and how it is taxed. Then, we’ll be going in-depth on several tax deductions you need to know about and how to take advantage of them. 

How do I know I am a sole proprietor?

Great question. It’s important to establish if you are a sole proprietor to determine your tax obligations. This is necessary so you can calculate your deductions!  

A sole proprietorship is not limited to a specific industry. In its most basic form, a sole proprietor runs and operates their own business. It is not established as a legal entity, therefore all the financial and legal obligations fall upon the owner. 

Even if you do projects as an independent contractor for one or two firms, it’s very likely you are a sole proprietor. Typically, companies do not withhold taxes from an independent contractor’s wages. If no one is withholding your taxes, most likely you’re a sole proprietor. 

The beauty of being a sole proprietor is the simplicity of setup. It’s by far the easiest company to start because essentially, all you need is yourself and a skillset. To give you some ideas, here is a sample of a sole proprietorship business: 

• Computer repairs services 

• Freelance writing or graphic design 

• Landscaping or lawn company 

• Photography

Do sole proprietors pay quarterly taxes?

If you’re new to working for yourself, there will be some familiarity with how your taxes work.

Like most W-2 employees, you’ll have to file your sole proprietorship taxes annually (usually April 15th).

One major difference is the payment of quarterly estimated taxes. These are made each quarter to help satisfy your tax obligations since you do not have an employer taking this money out of your paycheck.

If you work with an accountant, they can help you determine your sole proprietor taxes for each quarter. 

To make accurate payments, you’ll need to know your net profit or loss. The IRS requires payment on any net income above $400 earned each year.

How does a sole proprietorship pay taxes?

Now that you know you’re a sole proprietor, it’s important to start thinking about taxes. We know this isn’t the most fun topic.

We’re going to break it down and help make the process a little easier. 

The easiest way to pay your sole proprietor taxes is to visit the IRS website and pay electronically. You can use either your bank account, a debit or credit card. By using your bank account, you can schedule payments in advance. Those paying with debit or credit card also have the option to call and make a payment. 

You can send a check, although online is the quickest option.

If you’re unable to meet your tax obligation, you can set up a payment plan. Note that this may include interest and late fees. 

Don’t forget to check out your state’s Department of Revenue site. They manage state sole proprietorship taxes and that is where you will need to make your state payment. While you may owe fewer state taxes than federal, it’s important to take care of it.

Do sole proprietors charge sales tax?

The answer depends on the type of business you operate. According to the balance small business, sole proprietors do pay sales tax on goods and products they sell. So if you’re running a flower shop or online store, you’ll be required to pay state taxes on the goods you sell. Your tax rate will vary based on the state you live in. 

If you’re a writer or graphic designer, you won’t have to pay sales taxes on your services but you will owe state sole proprietorship taxes on the revenue you earn.

How does a sole proprietor get a tax refund?

A sole proprietor’s best chance of getting a refund is overpaying on your quarterly estimated payments. By paying more than what you believe you owe, you increase your chances of receiving a refund once you file your return. 

As stated in the balance small business, if you do pay extra in hopes of a refund, you forego the opportunity to use that money elsewhere throughout the year.

What can you write off as a sole proprietor?

Now for the good stuff. Let’s talk about the deductions you can use when filing taxes as a sole proprietor.

You may have a lot of questions, like, “how much of my phone can I claim on my taxes?” or “Can you write off a home repair?”

IRS sole proprietorship guidelines go through each of these. But, to save you some time (because we know how precious that is as a business owner), we’ve put together a list of important deductions you need to know about. Using this will help you reduce the burden of your sole proprietor taxes.

Are startup costs tax-deductible?

At this point, you’re well aware that starting a business is a challenge.

And it’s expensive.

Fortunately, you can deduct some of your startup expenses. The IRS will allow claims of up to $5,000 in your first year of operation. These costs vary but include advertising, travel, and fees associated with professional services or consultants. 

The IRS recommends treating all your startup costs as capital expenses. While you can deduct interest and taxes in some circumstances, they cannot be deducted as startup costs on your sole proprietorship taxes. 

Costs of getting your business started

A sole proprietorship has one of the lowest barriers to entry for starting up. But, like any business, you will invest some money to get your idea off the ground. Many of these expenses can be deducted from your sole proprietor taxes. 

Most businesses need a website. Whether you build the site yourself or pay an expert, there are costs associated with getting a site launched. You need to register a domain name, build out landing pages, and more. Each of these items has a cost. The great news is you can deduct each as a business expense on your sole proprietorship taxes.

Even after your first year of business, as long as you use that site for your work, you can continue deducting the costs of your website.

Depending on the technology, you can have deductions on things like printers and computers.

You have the option, under Section 179, to write this off the year of purchase, or over several years. Software purchases can qualify as well.

This does not include personal items. Sorry, no deduction for playing Minecraft. 🙂

Depending on your industry, you may want to invest some money in advertising. This could be anything; digital, print, or podcasting. The costs of placing an ad can be deducted on your sole proprietor taxes. 

Continued education

Maybe you want to take a few classes to broaden your skillset.

You can deduct the cost of your own education. Classes that maintain or improve skills in your current field can be deducted.

You need to be able to show that the knowledge you gained maintains or improves the skills required by your job.

Taking a cooking class if you’re an accountant is probably not going to qualify as deductible (but it may save you money on client dinners).  

Deductions for your health insurance

You’ve likely purchased health insurance through a private carrier or the Healthcare Exchange.

In most situations, you’ll be able to claim a deduction on any health, dental, and qualified long term care insurance you’ve purchased.

This can include you, your spouse, and any dependents. Not only are these good investments, but they are a great deduction on your sole proprietorship taxes.

Writing off Social Security and Medicare taxes

For most W-2 employees, their employer manages the deduction of Social Security and Medicare from their paycheck.

As a sole proprietor, you’ll have to take care of this on your own. You can claim a deduction of 50% on your quarterly social security and Medicare payments made throughout the year.

Retirement Plans

Contributing to a retirement account is a no brainer. As a sole proprietor, it’s even more important to stay on top of your savings. The IRS allows you to deduct some of your contributions on your taxes. 

Let’s take a look at two of the more popular plans and their impact on your sole proprietorship taxes. 

• Roth IRA: Contributions to a Roth IRA account are not deductible. 

• Traditional IRA: You’re allowed to take a full deduction of your contribution if you or your spouse (if you’re married) are not covered by an employer retirement plan. 

The rules get a little tricky with sole proprietor taxes. The deduction can vary based on the plan you choose and if you contribute to an employee’s plan. 

The IRS has an entire page dedicated to self-employed retirement plans. It includes the various deduction possibilities for each retirement plan, from 401Ks to Roth IRAs.

It pays to work in your PJs

It’s very likely in our current environment that you’re working from home. Maybe that’s always been your office. Since you use this space for a business, it can be claimed as a deduction. The IRS uses two methods for home office deductions: the Simplified Method and the Regular Method. No matter which you choose, there are two basic criteria: Your home office needs to be your regular place of business and be exclusively used for these purposes. It is your principal place of business.  We’ll answer the questions of how to calculate home office appreciation and deduction.  If you have a home office, or room that is used as such, this will qualify as a space that can be deducted. If you’re working out of your kitchen or dining room, things may get a little trickier since you do other activities there.  Maybe you’re a road warrior or also use a co-working space for client meetings. This is perfectly fine, as long as you still do substantial business in your home and calculate it accordingly.     

• Simplified Method: 

  • This became an option in the tax year 2013.  

  • While it does not change the criteria of qualification, it simplifies the calculation.  

  • The standard deduction is $5 per square foot (up to 300 sq. feet). 

  • Certain expenses may qualify such as mortgage interest and real estate taxes.

  • This method keeps it simple by reducing the amount of record-keeping. 

• Regular Method: 

  • If you go the regular route, you’ll have to determine each expense associated with your home office (utilities, mortgage interest, insurance, etc.) 

  • Instead of cost per square footage, the deduction is calculated on the percentage of your home devoted to business usage. 

  • Using the regular method, you may be able to claim direct and indirect expenses on your taxes. 

Here’s a full list of allowable deductions from your home office: 

• Rent 

• Casualty losses 

• Mortgage interest 

• Insurance 

• Utilities 

• Depreciation 

• Maintenance & repairs 

These write-offs typically fall into two categories; they are either direct or indirect expenses. Direct expenses are related exclusively to the business area of your home, so repairs and maintenance to your office would qualify as a direct expense. These are typically fully deductible.  Indirect expenses relate to your entire home. Things like insurance and utilities are indirect because you utilize them for both business and personal use. You’ll need to calculate the percentage usage of these expenses as it relates to your business to determine the allowable deduction. 

Can you really write off home repairs?

You can write off home repairs that are directly related to your home office. Maybe you built some shelving, a new desk, or applied a fresh coat of paint. These are deductible expenses. 

Unfortunately, writing off the new countertops in your kitchen will not qualify as an allowable deduction.

What percentage of utilities can I claim?

That was probably one of the first questions on your mind when you saw utilities on the list.

Since utilities in your home overlap with personal use, you’ll need to determine the percentage use of your home for business. You can use that calculation to determine how much of your utilities you can write off.

How to calculate home office depreciation?

The IRS does allow depreciation on the part of your home used for business, but you can’t depreciate the cost or value or the land. It’s important to know a few things before depreciating your home: 

• The point in time you started using your home for business. 

• The cost of improvements made before and after you started using it for business. 

• Percentage of your home used for business. 

You must know the percentage of your home that can be depreciated for business use. Then, you’ll want to multiply the percentage of your home that is used for business by the lesser of the following: 

• The adjusted basis of your home when you started using it for your business. 

• Or the fair market value when you used it for your business. 

Determining home office deduction method

If you’re wondering which method is best for you, whip out your calculator (AKA your cell phone) and do a little math. If the estimated deduction is about the same, you’ll likely save yourself some time and stress by using the simplified method.

No matter which you choose, this is one of the best deductions to claim on your sole proprietorship taxes. 

Special exceptions apply to daycares. If you use your home for the care of children, persons over the age of 65, or those unable to care for themselves, you can still use a home deduction. You need to determine the percentage of your home used for daycare. 

What if you rent?

Since we’ve talked about home office space, this may raise a question: “I’m a renter. Can I deduct rent on my sole proprietor taxes?”

The short answer is, yes. The same requirements apply to the business use of your home. 

If you rent space (an office, co-working desk, store, etc.) you can use this as a deduction. 

The IRS does have a caveat on what they refer to as “unreasonable rent.” Meaning, if you’re renting space from someone to whom you’re related, you need to pay them the same amount you would a stranger landlord. This situation typically only arises if you’re related, in some way, to the owner of the property.

Deductions for your phone

If you’re running a business, you probably wonder “how much of my phone can I claim on my taxes?” After all, it’s a big part of your operation. And cell phones aren’t getting any cheaper (like we said earlier, it doubles as your calculator). 

The IRS does not allow you to deduct the costs of the first telephone line in your home. You can deduct the expense of long-distance calls or the use of an exclusive business phone.

Deducting your mileage and travel costs

Although you may mostly work at home, or in an office, as a sole proprietor, you probably use your vehicle for business purposes; driving to meetings, conferences, business meals.

You may also use that vehicle for your personal life. If so, you’ll need to calculate the percentage usage for your business. 

Mileage can be deducted. This relates to trips outside of your normal commute or within the general area of your business and residence.

In 2019 the standard mileage rate was 58 cents per mile. In 2020 it is 57.5 cents.

Meals

Ah, the client dinner. Or lunch. Maybe coffee. Love them or hate them, these meetings can add up in cost. You can typically qualify for a 50% deduction of the costs associated with meals and entertainment. Traveling to these meetings is a separate expense and not subject to the 50% rule. 

Traveling for business is often a great time to enjoy some personal time and sightseeing. If you incur any expenses on your trip that are not related to the business (i.e. going to a sporting event or visiting a museum) then you cannot deduct those as part of your trip.

Is coffee a business expense?

If you’re a coffee-lover, you’re in luck. You can deduct your coffee expenses in certain conditions. Kiro Coffee gives a great breakdown of how to write off your coffee addiction. 

If you’re making a run to your local coffee shop for an afternoon pick me up, this is not deductible. But if you’re meeting someone there for a meeting, you can write off 50% of this cost. 

If you buy brewing equipment or coffee for use at your home office, this qualifies as a deductible expense on your IRS sole proprietorship taxes.

Depreciating assets (Codeword: Section 179)

For most sole proprietors, it’s unlikely you have a large number of assets with the depreciation that can be deducted.

Let’s touch on this briefly so we cover our bases. Beginning in the tax year 2020, you can deduct a maximum of $1,040,000.

The most likely application for your sole proprietorship is depreciation on a vehicle. A vehicle you use for work, and first placed into service in 2019, can have a maximum depreciation deduction of $10,100. 

Impairment expenses

If you’re an individual with an impairment, you may use services or tools to help you with business tasks. If the assistance is exclusively used for business, you can deduct the costs on your sole proprietorship taxes. 

Maybe you need a computer to type documents and emails and are unable to do so yourself. Purchasing a dictation software that is used for your business would qualify as a deductible expense. 

Bad debts, interest on loans, fees, oh my...

Hopefully, this doesn’t happen often, but you may have a client who cannot pay a debt they owe you. 

You can only claim a bad business debt if it was previously reported on income. 

You can generally deduct interest on loans you intend to repay. This is particularly useful if you’ve taken out a mortgage to purchase your place of business. You can deduct the expenses used to obtain a mortgage (again, if you use that property for business purposes) from your sole proprietor taxes. You can also deduct the interest you pay on the mortgage. 

If you take out a credit card for your business, you have the opportunity to claim fees as a deduction. Oftentimes these come in the form of annual fees for usage. 

Clubs and organizational fees

You may join a networking group, chamber of commerce, or trade association. These are great ways to get the word out about your services and meet other professionals. If these types of organizations are established to serve a business purpose, their fees can be deducted. 

This is an exception to the IRS’ rule that club feeds are non-deductible. Sorry, your golf course membership didn’t make the cut.  

Helping you help yourself

There are a number of things you can do to make tax season less panic-inducing: 

• Keep track of your records. Digitally, or hard copy (preferably both). Be sure you hang on to this info. Save your receipts, invoices, statements, and keep them organized. This will make it much easier to access and help you take advantage of all possible deductions. 

• Find a good accountant or bookkeeper and hire them. It’s worth the investment to make sure you file correctly and take advantage of all these sole proprietorship tax deductions. You may not be very good at maintaining records, that’s okay. An experienced bookkeeper will make your life much easier and help avoid any critical mistakes. Your accountant will appreciate the bookkeeper’s work when it’s time to file taxes. Bonus: the cost of these services is deductible.

• Keep your business and personal expenses separate. Things can get complicated if you blur these lines. The purchases you make with business income should primarily support your business activities (Hint: going out to lunch for yourself on the business account is not going to be a deductible expense). 

COVID-19 considerations

Due to the ongoing pandemic and economic crisis, the IRS has delayed the 2019 tax deadline until July 15, 2020.

Check out their People First initiative page for more information. They’re making exceptions to help during this difficult time, including payment plans and giving those who owe delinquent bills a break.

Many state governments have altered their tax deadlines, so check with your Department of Revenue for more info.

Additional resources for the sole proprietor

The IRS recently launched their Gig Economy Tax Center. It provides resources and tax help to workers who provide on-demand services. This is a great way to learn more about your tax obligations as a sole proprietor. 

Given the rise of gig jobs, IRS sole proprietorship resources have been made readily available. From ride-sharing services to online creative market places, more people than ever are earning income through side gigs. 

This type of work is generally categorized as being part-time, or temporary, and often done through digital platforms. Services like freelance writing, photography, or design work could fall into this category. Others may sell handmade goods through online marketplaces like Etsy or Uncommon Goods. 

There are tax implications for anyone who works in these fields. Whether gig work is your full-time business or just a side hustle, you’ll need to pay taxes on this income. The IRS suggests keeping track of all expenses to help lessen the burden of your sole proprietorship taxes. 

On the income side, you need to keep track of what you’re earning (this is just good business practice). Even if you don’t receive a 1099 tax form from those with whom you’ve worked, you’ll still need to report this income. 

Solopreneur doesn’t mean you’re in this alone

Tax season sends a shudder down the spine of even the most financially savvy. Many people stress about affording their tax bills or getting everything correct on their return. Filing taxes as a sole proprietor does not have to be a lonely journey.

There’s a lot of information out there, but arming yourself with a good bookkeeper or accountant will make the process much easier. 

Even if you’re capable of managing your own records, consider purchasing a reliable bookkeeping software so you have everything in one place. We can’t express enough how important it is to maintain good records for your sole proprietorship taxes. Your life will be much easier by April 15 (or July 15 in 2020). 

Practice good habits with your business income. View your taxes as a way to reduce the expenses in your business. When you’re running a sole proprietorship, taxes can be one of the few major expenses you have a direct ability to change. Rent, payroll, insurance, are all difficult to reduce. By being diligent in how you run your business, you can greatly lessen the impact of taxes on your bottom line. 

We’ve covered a lot in this article. From questions like, “how much of my phone can I claim on taxes?” to writing off your coffee habit. Keep an eye on our blog for more great tips to manage your sole proprietorship. Use these tax deductions to your advantage as you grow your business.

LessAccounting wants to help sole proprietors do what they love. This means less time sweating the details like taxes and deductions. 

Tired of doing your own books?

Schedule A Free Bookkeeping Consultation Now!

IRS Resources:

About Publication 587, Business Use of Your Home (Including Use by Daycare Providers). (n.d.). Retrieved from https://www.irs.gov/forms-pubs/about-publication-587

Easy ways to pay taxes. (n.d.). Retrieved from https://www.irs.gov/newsroom/easy-ways-to-pay-taxes

Home Office Deduction. (n.d.). Retrieved from https://www.irs.gov/businesses/small-businesses-self-employed/home-office-deduction

Publication 535 (2019), Business Expenses: Internal Revenue Service. (n.d.). Retrieved from https://www.irs.gov/publications/p535#en_US_2019_publink1000209195

Publication 535 (2019), Business Expenses: Internal Revenue Service. (n.d.). Retrieved from https://www.irs.gov/publications/p535#en_US_2019_publink10007487

Publication 535 (2019), Business Expenses: Internal Revenue Service. (n.d.). Retrieved from https://www.irs.gov/publications/p535#en_US_2019_publink1000209188

Publication 535 (2019), Business Expenses: Internal Revenue Service. (n.d.). Retrieved from https://www.irs.gov/publications/p535#en_US_2019_publink1000208843

Publication 535 (2019), Business Expenses: Internal Revenue Service. (n.d.). Retrieved from https://www.irs.gov/publications/p535#en_US_2019_publink1000208843

Self-Employed Individuals – Calculating Your Own Retirement-Plan Contribution and Deduction. (n.d.). Retrieved from https://www.irs.gov/retirement-plans/self-employed-individuals-calculating-your-own-retirement-plan-contribution-and-deduction

Topic No. 509 Business Use of Home. (n.d.). Retrieved from https://www.irs.gov/taxtopics/tc509

True Catalyst Agency: First impressions mean everything-is your website dressed for success? →

When you meet a potential client you’re focused on the first impression. You know this interaction can make or break a deal. But have you thought about the impression before the first impression? We’re talking about your website.

A website is now your first impression 

Odds are your prospects will visit your website before the big meeting. And they may have already made some decisions about you and your company before you even shake hands. In today’s market, someone can look up your company in a few seconds on their phone. The design of your website and the information it provides is as important as that first handshake. 

Design matters 

In a recent post, The Daily Egg discussed the bounce rate of websites. According to The Daily Egg, users spend an average of 15 seconds on your site before they decide whether to move on. 15 seconds. Website design plays an important role in attracting and keeping people on your page. If your site looks and feels outdated or lacks visual appeal, people are likely to move on in their search. In crowded industries, this means a customer is likely looking at your competitor’s site.

Invest in your customer’s security

Security is paramount on the web today. If you’re running an online store or asking for customer information, people need assurance they are being protected. It is now common to see many data breaches each year that impact millions. Think about the message you send customers if your site is built on old HTTP code instead of the more modern and secure HTTPS. Customers are aware of these backend features on your site because they are concerned about their information. 

Speed kills

Humans have never been very patient but if something doesn’t fulfill customer expectations, they will quickly move on. Imagine trying out a new car and you hear some unusual noises. You will park it as quick as you can and look for something better. The same goes for your business website. If it runs slowly, or the page only half loads, expect your bounce rate to increase. Visitors to your site are rarely going to wait more than a few seconds for the results. If your site performs slowly or customers detect problems, they will expect the same from the other parts of your business and not hang around long. 

Optimize for mobile

Statista reported that thus far in 2019 52.2% of all web traffic was on a mobile phone. That’s up nearly 40% since 2012 when web traffic on mobile devices was at 10.7%. If someone is viewing your website they’re likely doing so on a phone or tablet (better than 50% chance to be exact). When you’re building or redesigning a website, it’s a must to keep in mind how it will appear on mobile. This optimization is critical to capturing an audience that is relying more on smartphones than ever before. 

Customers are going to search for you on the web; whether it’s a client you know or one you’ve never met. Investing in a quality website that delivers the right information to consumers is one of the most important decisions you can make for your company right now. 

How to Succeed Professionally and Personally During COVID-19→

During this crisis, our professional lives have been turned upside down. Remote meetings, no business travel, and fewer opportunities to network. Even though we are not able to connect in person at COR, we decided to call in some experts to discuss how you can continue to succeed and grow professionally during COVID-19. Our panelists are movers and shakers from around the Midlands. Even while they work from home, they continue to make an impact.  We were joined by: 

• Milo Anderson, Conservation Communications Manager, Riverbanks Zoo and Garden

• Hannah Brachte, Co-Owner of Studio Fire Yoga & Barre Studio

• Tracie Broom, Co-Founding Partner, Flock and Rally

• Mario Melendez, Field Director and Financial Advisor for Northwestern Mutual

• Megan Pinckney, Digital Content Producer and social influencer @shadesofpinck

Managing work-life balance (now that work and life are both at home) 

As many of us work remotely, one of the first issues we tackled was how to manage the work-life balance now that our homes have become offices.

Though there is not a one-size-fit-all answer, this time provides many of us an opportunity for increased flexibility. For example, exercising in the middle of the day is now possible instead of only having that time in the morning or evening.

 Motivation and scheduling can be a challenge with kids at home, a roommate or partner also working remotely, or simply adjusting to no longer having a commute. Our panelists agreed that all of us should try to take a step back. Keep a check on your mental health and how you are handling this difficult time. Maintain a routine. Even if you’re no longer making the drive in on I-26, you can continue to exercise, make that morning cup of coffee, or whatever you do to get your workday flowing. Continue to check-in with your team as if you were in the office. If you manage others, consider offering “office hours” so your employees can ask questions at designated times during the day. 

Tips and tools to get the job done remotely 

COVID-19 has created a crash course in productivity hacks. We asked our panelists, which tools have helped you and your teams manage the change in workflow?

Video technology was by far our panelists most popular answer. By now, we’re all pretty familiar with Zoom meetings and webinars. But what other tools have our panelists used? Zoom may not be the best option for your team, so our experts suggested checking out GoToMeeting or Whereby. RingCentral and Join.Me are also great options. If you interact with your followers on social media, consider utilizing Facebook’s people power through their live stream function.  

Defining success during a pandemic 

We all have goals and ambitions, and it may feel that our pursuits have been interrupted. How should we define success during this time? 

Our panelists work in a variety of industries, each with different challenges. One of the best responses was to step up and take action. Sitting around and waiting for this to be over is not an option. Success is defined differently for each individual, but during this time we can frame simply having health and family as a triumph. 

How to maintain good habits we’ve developed during quarantine 

One day (hopefully very soon) all of these social distancing measures will come to an end. What  should we do once we transition to a more normal life? 

Exercise. There’s a clear connection between your physical and mental health. Many people are going on walks, biking, or just getting outside for a break from being in their home. It’s important to continue this even as we establish a new normal. 

Practice acceptance. Many of our circumstances are beyond our control. Use this time to learn to manage the situation you’re facing. 

Try something new. If you’ve always wanted to play the oboe, this may be your time to learn!  

While at home, this can be the perfect opportunity to take a step back and do something you’ve always wanted to try. Maybe that’s learning an instrument, starting a podcast, or writing. Take time to enjoy the moment and possibly discover a new passion! 

Adapting your business strategy 

For entrepreneurs and managers, how does our business strategy have to change? 

We had lots of great answers here and they all have a similar theme: be kind and take care of your people. “Pivoting” is a popular term right now and our panelists believe it’s necessary. It could take a shift in your business model to stay relevant and engaged with your customer base. Help clients with unforeseen problems. If you’re publishing content, keep it lighthearted and creative. Lead your team with compassion, take a breather, and give employees a break. No one has the perfect answers to manage this crisis; it’s a challenge for your team in many different ways. 

Staying connected 

One of COR’s main objectives is to connect people in the Midlands. How can you do that during COVID-19? One of the first steps is to be genuine. Remember that we’re all human beings with lives and loved ones outside of our professional setting. Call up your contacts; not to make a sale or close a deal, but simply to check in and see how they’re doing. Support our local businesses and utilize digital tools to stay connected with friends and family. 

Speaking of supporting local..

Small businesses and restaurants need us more than ever. In what ways can we support them? 

Lunch dates! (Even if it’s in your car). Our panelists said they were grabbing a local beer and having socially distanced happy hours in their yards. They’re also supporting local restaurants through takeout and curbside service. Many nonprofits are suffering during this time and our panelists are giving back, especially via Midlands Gives. 

Stay plugged in by checking out experiencecolumbia.com for special COVID-19 virtual events. Many of the local districts (Five Points, The Vista, Main Street) are posting socially distanced activities in their area. And check out Facebook groups like Columbia Curbside for local restaurant options. 

Taking care of our mental health

This one is important. How can we stay on top of our mental health during this period of uncertainty and isolation? 

It’s important to stay in check with our emotions. They can be a roller coaster when faced with a lot of uncertainty. Do what you need to do to maintain some balance and manage the lows. When you wake up in the morning, practice being grateful. Pick three things you’re thankful for and say them out loud. This can make a huge difference in the emotional swings you may experience throughout the day. 

Working from home after we go back to the office 

And finally: if you want to keep working from home, how do you pitch that to your boss? 

Show data. Demonstrate how you and your team have been more productive since moving to remote work. And expect a shift in workflow for everyone going forward. 

Until next time! 

We had a great time sitting down with our panelists and discussing how we can continue to succeed during tough times. We can’t wait to see you in person at the next COR Connections or Table for Six. If you didn’t get a chance to catch this virtual happy hour live, you can rewatch it here.

The Acupuncture Clinic: The Results Of Acupuncture Treatment Cannot Be Ignored→

What is acupuncture? 

Acupuncture is a practice rooted in traditional Chinese medicine and has been utilized for generations. Acupuncture is administered by the insertion of thin, acupuncture needles at specific acupuncture points on the body. Through stimulation of blood flow by needle insertion, it helps regulate the body’s ability to heal. 

Acupuncture is now receiving the recognition it deserves from leading health organizations. The Mayo Clinic, World Health Organization, and National Institutes of Health are among those that validate the effectiveness of acupuncture for a broad range of health issues and recommend its use alongside conventional medical practices. The Joint Commission, which is the largest accrediting healthcare body in the US, now lists acupuncture as a standard non-pharmaceutical treatment for pain and mental conditions. 

How can acupuncture help you?  

Most patients use acupuncture sessions to treat pain. This could be chronic or acute pain and the result of a variety of injuries. Common conditions include migraines, back pain, neuropathy, arthritis, neuralgia, tendonitis, sciatica, and others. 

Recent research has found that acupuncture can do more than relieve pain. It is successfully being used in medically undiagnosed mood and stress-related conditions. Veterans Affairs has used it to treat post-traumatic stress disorder patients and those suffering from anxiety.

The Mayo Clinic found that acupuncture improved fatigue, anxiety, and other side effects in fibromyalgia patients. Nausea, malaise, and mood are all positively affected by acupuncture treatment. 

We know acupuncture works. For many patients, it offers effective pain management, treats chronic pain issues, and helps people feel better when other methods are not providing relief. 

So what’s next for acupuncture? Modern research technology and medical imaging are giving us a better idea of its benefits. Physicians can now pinpoint activities and changes in a patient’s brain and body related to acupuncture therapy. This will greatly improve the effectiveness of acupuncture applications. 

Acupuncture and its benefits beyond physical pain relief 

More and more, acupuncture therapy is proving beneficial for mental health, treatment of depression, anxiety and even PMS and menstrual cramps. The Harvard Medical School and the Advanced Integrative Rehabilitation and Pain Center found evidence that supports the use of acupuncture in cases of prenatal depression. Other research has shown improvement in the quality of life and enhancement of antidepressant treatment for patients receiving medical care. 

A new way to combat the opioid epidemic 

As the US grapples with a growing number of opioid-addicted users, members of the medical community are searching for ways to treat pain without addictive pills. Instead of using potentially harmful drugs to cope with pain, acupuncture has emerged as a way to treat problems safely. The American College of Physicians is recommending acupuncture as a non-drug therapy to be used in chronic and acute back pain treatment, before using traditional drugs. 

You want to try acupuncture. Now what? 

The first step is knowing your condition and making the determination if acupuncture is an effective treatment for you. Your physician can make a diagnosis and give medical advice if acupuncture is a good option for you. If you want to pursue acupuncture therapy, make sure your practitioner is licensed by your state and holds board certification from the National Certification Commission for Acupuncture and Oriental Medicine. 

As acupuncture becomes more widely known and recommended, it is now commonly administered by the medical community. Two-thirds of military hospitals and other treatment facilities are now offering it. 

Some insurance companies now include acupuncture in their coverage. Bluecross Blueshield of Tennessee no longer covers prescription Oxycontin (a powerful and addictive painkiller) and will now cover acupuncture as an alternative to opioids. State Medicaid programs in California, Rhode Island, Oregon, and Massachusetts all cover acupuncture treatment for pain. Oregon and Massachusetts both cover it as a treatment for substance abuse. 

The results of acupuncture therapy are evident and transformative. Whether you suffer from chronic pain, acute pain, or anxiety, it can be an effective treatment for you. Give us a call to set up a consultation, or explore our website to learn more. Check out our blog for information on specific topics in acupuncture and to keep up with what’s going on in our office! 

Source: https://scacupuncture.com/news/the-results-of-acupuncture-treatment-cannot-be-ignored/

Consult Direct: Crafting a personal brand to achieve your professional goals→

The culture of work is changing. The gig economy is growing rapidly and providing great opportunities for both organizations and talented individuals to take advantage of contractor and consultant roles. Whether you’ve made the jump to independent contracting, or you're considering it, it’s important to understand the need for a personal brand, or, “Brand of You.” Once you leave the confines of a full-time position, you’re no longer associated with a larger organization or company. We’re here to explain the importance of establishing a personal brand and how we can help you create your own “Brand of You.”

4 phases for success

We address personal branding in four steps:

• Profile Optimization 

• Digital Footprint 

• Skills Roadmap Plan 

• Marketing Elements 
  

 We’ll explain each of these in further detail and discuss what they mean to you. And don’t worry, you won’t be working on these things alone. We have dedicated digital talent agents to help you along the way. Our goal is for you to achieve professional happiness. The process is built around our community. By working with others, establishing goals, and creating a path to grow and learn you can achieve the flexibility and independence you crave. 

Profile Optimization 

A profile is a summary of you as a professional. It may look like the standard, traditional resume, formatted digitally on a website, LinkedIn, or any number of ways. It’s your first presentation of who you are to potential employers and clients. By working with one of our digital talent agents, we optimize your profile for the roles you’re pursuing. In this phase of our methodology, a talent agent will examine your current resume and show you how it looks across multiple platforms. Then you’ll work together to plan out your profile so your skills are marketed to the right opportunities. 

Your profile should be dynamic. Some companies use an Applicant Tracking System (which we covered in a recent post) to manage the volume of resumes they receive. In this case, your profile needs to cater to the system with the correct keywords and formatting. Other times you may know that an actual person will be looking at your resume first. You can be more creative with your profile for these jobs. 

An independent contractor resume needs to be different than the one you’ve used for permanent, full-time gigs. It’s important to go into more detail about specific projects, technologies, and methodologies in which you’ve had experience. Use data and specific examples (preferably with measurable success) to demonstrate your expertise. 

Utilizing your digital footprint

You’re probably familiar with the term “digital footprint,” but may not give much thought to how it can boost your professional profile. Employers are actively looking at candidates’ online presence, such as social media, websites, and community forums. Anything they can find when they “Google” your name.  

These platforms can be great assets when utilized correctly. Our talent agents will craft a strategy to build a powerful digital footprint. When employers search for you online they’ll see content that complements and promotes your professional profile. 

Skills road map for your career 

It’s common to see business sites and publications talk about the “top skills” for the current and future job market. However, it’s important to truly dive into your industry and research the skills you need today and in the future. Technology, in particular, is susceptible to rapid change. Skills that were relevant a few years ago are completely out of date now. 

We know this can be overwhelming to research and track on your own. Additional training is often expensive and time-consuming. Our community helps identify the skills that are in demand, connect with you people who can support your growth, and find development opportunities.  

The marketing of you 

Marketing is essential. No matter how talented or skilled, if you do not present yourself well you won’t be able to get your foot in the door. This part of our process will identify the best version of you. We work to define who you are as a professional and create your pitch. Many professionals miss this part of the process. Our coaching will make sure you’re prepared when a potential opportunity asks, “What do you do?” 

Navigating the independent contractor world is a challenge. We want to work with you to maximize your skills and market you to the right opportunities. Check out our resources for more posts and tools to help you grow professionally.

https://www.consultdirect.co/blog/crafting-a-personal-brand-to-achieve-your-professional-goals

Consult Direct: 3 steps to writing a better resume for your next technology role→

As a technology consultant, a great resume can be the ticket to the contract you've wanted to land. Conversely, having an average resume can leave you disregarded from jobs in which you are qualified. The tech sector is highly competitive. It's important to not only make yourself standout, but to understand hiring practices and what you can do to put yourself ahead. 

The components of a good resume 

A resume needs to have a structure that makes it easy for hiring managers to follow and read. Generally, it's best to start with your name and personal information (email address, mailing, address, phone number) at the top of the page. Professional summaries are optional, depending on the role, but often take up valuable space. List your professional experience in reverse chronological order, beginning with your most recent, or current role. Include the company name, your title, location, and the timeframe in which you worked. The best resume examples are tailored to specific roles and industries. If there are positions that are not relevant, remove them. If you have more than ten years experience, delete anything older than the previous decade. Following your professional work history, list your education starting with the most recent degree you’ve completed. If you’re currently in school, or working on and advanced degree, list that program first with your start date and anticipated graduation date. Conclude your resume with information such as volunteer experience, professional associations, or board memberships. If you have additional training or development opportunities, this is a great place to list those as well. 

A good resume example follows a formula of simplicity, consistency, and quantifiable achievements. Focus on these components as you have a hiring manager's attention for only a few seconds. According to Resume Worded, a resume needs consistent formatting. This means using the same font, margins, and style. Ensure dates are formatted the same throughout your resume. Use a simple template; let your experience do the talking. State your achievements in quantifiable terms. Firms want to see measurable evidence of your contributions, not only the responsibilities you have. Use action verbs to describe your work. 

How to beat the screener 

Often, candidates apply for positions in which they are qualified, but are never interviewed. It's likely, particularly in larger organizations, they were ruled out by automated resume screening. How do you get through this system? It's all about keywords. FitSmallBusiness provides great insight into applicant tracking systems, or ATS. Many use automated resume screening designed to save recruiters time on candidate review. They're programmed to identify certain keywords from a job description, search for them on a resume, and sort applicants based on established criteria. 

When an ATS screens your resume, it will parse your information as it searches for the keywords of a particular role. Even if you have experience that is relevant, if the keyword is not correct, you may be listed as an "unqualified" candidate. This means you need to pay close attention to how the job description is written. According to Glassdoor, corporate positions receive an average of 250 resumes. 4 to 6 candidates will be interviewed, and only 1 will be hired (Source: Next Gen Personal Finance). Major corporations are using automated resume screenings to deal with the enormous volume of applicants they see for each job. Knowing that a large number of prospects are applying, it's important to incorporate keywords into your resume for each job. 

What makes a great technology resume? 

Standing out in a competitive technology market is more than great bullet points on a resume. Kelli Smith, in her article How to Make Sure Your Resume is As Current as Your Skills, writes about the importance of including a link to your online portfolio. Showing companies real examples of your work will help separate you from other candidates. Smith also gives advice on how to deal with resume screeners. Reference specific coding languages or software (Java, C#, etc.) instead of general terms like "coding" and "software development." 

Source: https://www.consultdirect.co/blog/3-steps-to-writing-a-better-resume-for-your-next-technology-role