The Fix is In



SANDY BOTKIN QUESTIONS DATE: ____________

NAME: ___________________________________

SECTION: ________________________________

1. Who is Sandy Botkin? (What is a CPA? What do you have to do to become a tax attorney?)

CPA and tax attorney, worked for Tusch-Ross, then IRS chief counsel’s office (top IRS legal office – 5 years – one of 9 attorney’s to train attorneys in corporate tax division, founding member of IRS tax shelter group.

2. Overall, what was his presentation about? (One comprehensive sentence that says it all)

3. How does Botkin suggest that you can get a big raise without “asking the boss?”

Owning a home-based business.

4. According to Botkin, what are the advantages of owning a home-based business? 1) Income flexibililty (you can make as much as you want), 2) lifestyle flexibility (allows you to work or not work), 3) you can work at home (no commuting), 4) flexibilty in hours, 5) no employees and no law suits, 6) redirected expenses (you can get your products at wholesale), 7) redirected income (income from regular job can be offset by expenses from HB business.

5. Why is the IRS interested in giving special tax breaks to small businesses?

Because small businesses (entrepreneurial spirit) is what has made the U.S. grow ecomomically. Making it easier for small businesses to succeed, the government reasons, makes it easier for the country to grow.

6. What percent of our workforce, according to Botkin, is made up from small businesses? 70 percent How many small businesses start up every day? 8,000

7. According to Botkin, in order to take advantage of the many tax deductions afforded to small businesses, you need to pursue a ___________. He says that you do not need to make _______. If you take a loss in any year, you can apply that loss to other income you make from salaries or any other source of income. He says that you never lose __________ business deduction. If your loss this year exceeds your income, you can carry your loss back _____ years and get a refund. You can offset up to the next _____ years of income from business losses.

8. What is the difference between a hobby and a business? Hobbies losses are limited to the business and cannot be subtracted from _________. Businesses have two or three year business plans with projected income or losses (hobbies do not), business (depending on type) likely will have _________ (hobbies usually do not), businesses keep good ______ records and a diary (hobbies usually do not), businesses are worked on a regular basis (hobbies ordinarily are not), business people want to make a ______ and constantly train and go to professional meetings (hobby people usually do not care about _________),

9. The key to increasing income is to convert what is not ordinarily _________ to that which is __________.

10. What are some examples of converting nondeductible expenses to deductible expenses for a home-based business?

11. Who are some professionals you should consult before starting any kind of business?

12. T F Your account is responsible for the accuracy of your tax return.

13. What form of business should you start with?

14. According to Botkin most home-base businesses have a ____ percent chance of succeeding in the first year.

15. If you sign up for a ___________ marketing program, whether you sign up as an individual or with your spouse can cost you thousands of dollars every year.

16. You can deduct up to _____ of your meals taken as part of your business activities.

17. Home entertainment expenses including business-related parties can be deducted at ______ percent on your taxes if documented correctly.

18. You can also deduct movies, golf, season tickets if ___________ correctly for the IRS. (15)

19. You can _________ most vacation costs if they are directly related to your business.

20. You can _______ some of your car mileage traveling to your primary job as a business expense if you document miles and business-related activity (listening to training tapes).

21. You can _______ wages paid to your children (7 to 18) and are exempt social security tax and unemployment insurance. _______ you pay to children can be deducted from your income tax, and your children do not have to pay any tax or social security up to $________ in income.

22. You can set up a medical reimbursement plan which allows you to deduct your ________ and _______ expenses for you and your family if you are operating a small business.

23. Sandy Botkins states that even if your new home-based business is not making money, “Just don’t _______!” Why does he say this? Be being able to deduct business expenses from your business and other income, you can actually _____ money from all the tax breaks you get by being in business.

24. Describe the conditions needed for you to receive at least a $5,100 pay raise every year for the rest of your life by owning a small business.

25. Find the answer to this question by browsing the Internet:

What is the standard business deduction for business-related automobile travel?

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