Tax Planning/Tax question

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Question
Good Morning Richard....Can you please give me some hints when it comes to taxes of a small business....I have 1.5 acre of land but usually not using about half acre which I was planning to use to set up a very small tree/plant farm. When it comes to plants and trees, how does the tax law applies to those businesses....It is not meant to be a main source of income, but more of supplemental income. Is there anyway to use tax advantages for business if I am not using the house, but the land?...any comments or recommendation will be greatly appreciated.

Answer
Taxes apply to revenue. If there is no revenue, then taxes aren't an issue.

If I understand your question, you are looking to put the ground toward developing income in the future. Maybe plant this year and harvest in 5 years?

The income comes in 5 years and then the taxes will apply. If between now and then you have expenses, you could carry those losses forward to offset the incomes.

The in home business deduction that everyone talks about is such a small real benefit and a big potential for audit that it has never been good. In fact there are no "Good" deductions when it comes to the personal tax return. Standard deductions, and home mortgage deduction, that is the lion share of potential tax benefit. Go beyond that and you are looking at nickels and dimes if that of tax reduction, but are offset by higher costs and higher potential for audit.

If I can redirect your focus away from taxes, to "business". . .

Can you make the tree farm a successful Business? Can you make a small investment that will return a profit? If you can do that, then Taxes matter. If you are losing money, you owe no taxes, it when you turn the corner and are successful that taxes come into play.

So the "Hints": Hard Focus on the business and turning a profit. One you have done that then everything else matters.



Richard

Tax Planning

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Richard Fritzler

Expertise

I am in the business of tax planning for business owners. Our company helps business owners structure so that they can be reduce the taxes that they owe, making them far more profitable.

Experience

Since 1986 I have been helping successful business owners reduce taxes, protect assets, and limit their liability. The company is Owelesstax, incorporated at www.owelesstax.com


Organizations
National Small Business Owners Association.
Nevada Association of Listed Resident Agents.
Citizens Legal Association
The Business Owners Institute

Publications
Contributing author to "The Corporate Standard Newsletter".
I am also a writer for an email newsletter about business
Googlegroups/Successfulbusiness
I am also an Expert in the areas of Tax Law, Retirement Planning, and Estate tax issues.

Education/Credentials
I have been in the business of assisting business owners in reducing their taxes and liability for over 17 years. Providing retirement option that are not just tax deferred, and not limited to a "token" tax free contribution. Retirement plans that allow for total and complete access before you are 59.5 with no penalties

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