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		<title>Senators try again to eliminate dual tax on telecommuters</title>
		<link>http://gigaom.com/collaboration/senators-try-again-to-reduce-dual-tax-on-telecommuters/</link>
		<comments>http://gigaom.com/collaboration/senators-try-again-to-reduce-dual-tax-on-telecommuters/#comments</comments>
		<pubDate>Fri, 11 Nov 2011 14:02:08 +0000</pubDate>
		<dc:creator>Jessica Stillman</dc:creator>
				<category><![CDATA[@NYT]]></category>
		<category><![CDATA[Congress]]></category>
		<category><![CDATA[legislation]]></category>
		<category><![CDATA[taxes]]></category>
		<category><![CDATA[Telecommuter Tax Fairness Act]]></category>
		<category><![CDATA[telecommuting]]></category>

		<guid isPermaLink="false">http://gigaom.com/?p=436709</guid>
		<description><![CDATA[Telecommuters whose employers are based in one state but who work out of another can run into tax headaches, as both states claim a portion of their pay. Now, it appears congress is making another effort to eliminate the double bill for remote workers.<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=gigaom.com&amp;blog=14960843&amp;post=436709&amp;subd=gigaom2&amp;ref=&amp;feed=1" width="1" height="1" />]]></description>
			<content:encoded><![CDATA[<p><a href="http://gigaom.com/collaboration/senators-try-again-to-reduce-dual-tax-on-telecommuters/5482670039_bcda850bfa_m/" rel="attachment wp-att-436716"><img  title="Telecommuter Tax Fairness Act" src="http://gigaom2.files.wordpress.com/2011/11/5482670039_bcda850bfa_m.jpg?w=604" alt=""   class="size-full wp-image-436716 alignright" /></a>As we’ve reported before, telecommuters whose employers are based in one state but who work out of another <a href="http://gigaom.com/collaboration/interstate-telecommuting-can-cause-tax-woes-too/">can run into tax headaches</a>, as both states try to claim a portion of your pay. Now, it appears congress is making another effort to eliminate the double bill for remote workers.</p>
<p>The two senators from Connecticut, a hotbed of remote work double taxation for professionals employed by companies in nearby New York who actually do their jobs from their leafy Connecticut communities, introduced a bill to eliminate the double penalty this week, <a href="http://thehill.com/blogs/floor-action/senate/192295-connecticut-senators-propose-ending-double-tax-penalty-for-telecommuters">according to a blog on political site The Hill</a>.  The post by Pete Kasperowicz reports:</p>
<blockquote><p>Sens. Joe Lieberman (I) and Richard Blumenthal (D) said the Telecommuter Tax Fairness Act, S. 1811, would help encourage telecommuting, which could create jobs, relieve traffic congestion and reduce the demand for gasoline.</p>
<p>&#8220;Although most states tax telecommuters on the percentage of time worked within that state, a few other states tax 100 percent of the income of nonresident teleworking employees whose companies are based in their state, regardless of the amount of time they are physically present in that state,&#8221; the two senators said.</p>
<p>&#8220;Consequently, because telecommuters&#8217; home states can also tax the income earned at home, workers nationwide are threatened with double taxation on that income,&#8221; they added. &#8220;This double tax risk puts telecommuting out of reach for many Americans.&#8221;</p></blockquote>
<p>Kasperowicz offers no information on how likely it is that the proposed legislation will actually become law, but as the bill was introduced <a href="http://gigaom.com/collaboration/ending-unfair-telecommuter-taxes/">at least as early as 2009</a> and <a href="http://www.govtrack.us/congress/bill.xpd?bill=h111-2600">never made it out of committee</a>, it doesn’t appear that being a common sense measure is enough to ensure swift passage.</p>
<p>If you’re feeling fired up to support the bill, there is <a href="http://www.petitiononline.com/totp02/petition.html">a petition online</a>.</p>
<p><em>Does the government do enough to support telecommuters?</em></p>
<p><em>Image courtesy of Flickr user <a href="http://www.flickr.com/photos/66351465@N00/5482670039/">Enter The Story</a>.</em></p>
<p><strong>Related research and analysis from GigaOM Pro:</strong><br />Subscriber content. <a href="http://pro.gigaom.com/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=436709+senators-try-again-to-reduce-dual-tax-on-telecommuters&utm_content=jessicastillman">Sign up for a free trial</a>.</p><ul><li><a href="http://pro.gigaom.com/2011/02/the-future-of-work-platforms-an-overview/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=436709+senators-try-again-to-reduce-dual-tax-on-telecommuters&utm_content=jessicastillman">The Future of Work Platforms: An&nbsp;Overview</a></li><li><a href="http://pro.gigaom.com/2011/11/dissecting-the-data-5-issues-for-our-digital-future/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=436709+senators-try-again-to-reduce-dual-tax-on-telecommuters&utm_content=jessicastillman">Dissecting the data: 5 issues for our digital&nbsp;future</a></li><li><a href="http://pro.gigaom.com/2011/11/connected-world-the-consumer-technology-revolution/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=436709+senators-try-again-to-reduce-dual-tax-on-telecommuters&utm_content=jessicastillman">Connected world: the consumer technology&nbsp;revolution</a></li></ul><img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=gigaom.com&amp;blog=14960843&amp;post=436709&amp;subd=gigaom2&amp;ref=&amp;feed=1" width="1" height="1" />]]></content:encoded>
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			<media:title type="html">Telecommuter Tax Fairness Act</media:title>
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			<media:title type="html">Telecommuter Tax Fairness Act</media:title>
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		<title>Why it&#8217;s critical to understand that your work takes place in a system</title>
		<link>http://gigaom.com/collaboration/why-its-critical-to-understand-the-system-your-work-takes-place-in/</link>
		<comments>http://gigaom.com/collaboration/why-its-critical-to-understand-the-system-your-work-takes-place-in/#comments</comments>
		<pubDate>Mon, 04 Jul 2011 21:04:10 +0000</pubDate>
		<dc:creator>Terri Griffith</dc:creator>
				<category><![CDATA[Amazon]]></category>
		<category><![CDATA[Amazon Associates]]></category>
		<category><![CDATA[California]]></category>
		<category><![CDATA[law]]></category>
		<category><![CDATA[legal]]></category>
		<category><![CDATA[organizational design]]></category>
		<category><![CDATA[Reorganization]]></category>
		<category><![CDATA[taxes]]></category>

		<guid isPermaLink="false">http://gigaom.com/?p=370181</guid>
		<description><![CDATA[It is important to understand that our work takes place in a system. To be an effective web worker, it is vital that you think about the whole system that you work in, not just the critical dimension of the moment.<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=gigaom.com&amp;blog=14960843&amp;post=370181&amp;subd=gigaom2&amp;ref=&amp;feed=1" width="1" height="1" />]]></description>
			<content:encoded><![CDATA[<p><a href="http://gigaom2.files.wordpress.com/2011/06/amazonassociates.jpg"><img  title="AmazonAssociates" src="http://gigaom2.files.wordpress.com/2011/06/amazonassociates.jpg?w=288&#038;h=300" alt="Screen shot of Amazon Associates email" width="288" height="300" class="alignright size-medium wp-image-370186" /></a>Last week, Colleen reported on the <a href="http://gigaom.com/2011/06/29/amazon-sales-tax-california/">email Amazon sent to all California-resident Amazon Associates</a> warning them that if California enacted a law imposing new taxes on Internet sales their participation in the Associates affiliate sales program would be terminated. I received my notification of termination Wednesday. Others will have deeper insight into the legal ramifications, as California is not the only state in the U.S. moving in this direction. My contribution is on how to work within such a complicated ecosystem.</p>
<p>It is important to understand that our work takes place in a <em>system</em>. In this case, the system is shifting quickly and is not well understood. Individuals, organizations, states and countries (recall the <a href="http://www.buzzmachine.com/2011/06/03/e-g8-a-discussion-about-sovereignty/">recent e-G8 meeting in Paris</a>) are all trying to both understand and create reality in the Internet-enabled world.  To be an effective web worker, <a href="http://books.google.com/books?id=WZL9LuUZgYUC">it is vital that you think about the whole system that you work in</a>, not just the critical dimension of the moment. Here are five dimensions to consider as you think about your own work in this system:</p>
<ul>
<li><strong>People</strong>. Who are the people that you must engage with? Knowledge, skills, abilities, preferences.</li>
<li><strong>Organizational process</strong>. This includes policies, procedures, workflows, and standard ways of operating.</li>
<li><strong>Organizational structure</strong>. The organization chart/reporting structure that you work within, which is often a good indicator of what an organization thinks is important.</li>
<li><strong>Technology</strong>. Both electronic and physical, on-hand or available.</li>
<li><strong>Context</strong>. The legal environment, your organization&#8217;s strategy (early mover, follower, growth, etc.), whether your organization is local/global, etc.</li>
</ul>
<p>To make effective decisions about your work, understand that you can never change just one thing. There is no such thing as a single silver bullet that will solve a problem. Fredrick Brooks, summarizing the issues in a classic 1986 article, writes, “There is no single development, in either technology or in management technique, that by itself promises even one order of magnitude improvement in productivity, in reliability, in simplicity” (<a href="http://www.sci.brooklyn.cuny.edu/~sklar/teaching/s10/cis20.2/papers/brooks-no-silver-bullet.pdf">pdf</a>). Even just changing from one email client to another has a human learning curve and may also affect your workflow.</p>
<p>Do a quick mental scan of the five dimensions in your situation. Focus on the two or three that you expect to have the greatest initial impact (this keeps you in tune with another piece of advice: <a href="http://gigaom.com/collaboration/small-wins-beat-stretch-goals-in-collaborative-work-practice/">go for small wins rather than stretch goals</a>) and will help you understand how things are working. If you change everything at once it is difficult to track the causes and outcomes.</p>
<p>For California residents, our <em>context</em> has just shifted. The most effective web workers had this possibility on their radar well before receiving the letter from Amazon and were proactive about their options and how the different dimensions were part of those options. For example, they have been lobbying their legislators, hopefully considering multiple dimensions as they thought about how to persuade them: Understanding their particular legislators&#8217; priorities and the organizational process to reach them. For some, moving to a different state may be an option, and again, multiple dimensions should be considered: The human costs of moving, supplier costs of moving, whether the new locale is next in line for a tax change. There will be no one right answer for the web workers affected by this change. The only &#8220;right answer&#8221; is that for this adjustment, and any other organizational decisions that you must make, you need to consider the entire system as you come to your understanding and choices. You can never change just one thing.</p>
<p><em>How are you preparing for changes in your working environment, regardless of whether or not you live in California and/or were a member of the Amazon Associate program? What were the dimensions you considered as you thought about the future?</em></p>
<p><strong>Related research and analysis from GigaOM Pro:</strong><br />Subscriber content. <a href="http://pro.gigaom.com/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=370181+why-its-critical-to-understand-the-system-your-work-takes-place-in&utm_content=terrilgriffith">Sign up for a free trial</a>.</p><ul><li><a href="http://pro.gigaom.com/2011/04/mobile-q1-all-eyes-on-tablets-t-mobile-and-att/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=370181+why-its-critical-to-understand-the-system-your-work-takes-place-in&utm_content=terrilgriffith">Mobile Q1: All Eyes on Tablets, T-Mobile and&nbsp;AT&amp;T</a></li><li><a href="http://pro.gigaom.com/2011/03/defining-hadoop-the-players-technologies-and-challenges-of-2011/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=370181+why-its-critical-to-understand-the-system-your-work-takes-place-in&utm_content=terrilgriffith">Defining Hadoop: the Players, Technologies and Challenges of&nbsp;2011</a></li><li><a href="http://pro.gigaom.com/2011/03/putting-big-data-to-work-opportunities-for-enterprises/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=370181+why-its-critical-to-understand-the-system-your-work-takes-place-in&utm_content=terrilgriffith">Putting Big Data to Work: Opportunities for&nbsp;Enterprises</a></li></ul><img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=gigaom.com&amp;blog=14960843&amp;post=370181&amp;subd=gigaom2&amp;ref=&amp;feed=1" width="1" height="1" />]]></content:encoded>
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			<media:title type="html">AmazonAssociates</media:title>
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		<title>Should You Use a Tax Pro?</title>
		<link>http://gigaom.com/collaboration/should-you-use-a-tax-pro/</link>
		<comments>http://gigaom.com/collaboration/should-you-use-a-tax-pro/#comments</comments>
		<pubDate>Wed, 24 Mar 2010 14:00:56 +0000</pubDate>
		<dc:creator>Thursday Bram</dc:creator>
				<category><![CDATA[Career]]></category>
		<category><![CDATA[deductions]]></category>
		<category><![CDATA[tax preparation]]></category>
		<category><![CDATA[taxes]]></category>

		<guid isPermaLink="false">http://webworkerdaily.com/?p=30267</guid>
		<description><![CDATA[There are some people who go to a tax preparer no matter how simple their taxes might be, just as there are people who spend hours preparing their own taxes every year, even though they aren&#8217;t tax professionals. The decision of whether to do your own [...]<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=gigaom.com&amp;blog=14960843&amp;post=30267&amp;subd=gigaom2&amp;ref=&amp;feed=1" width="1" height="1" />]]></description>
			<content:encoded><![CDATA[<p><a href="http://gigaom2.files.wordpress.com/2010/03/4105756012_db89e4be50.jpg"><img  title="Income tax" src="http://gigaom2.files.wordpress.com/2010/03/4105756012_db89e4be50.jpg?w=300&#038;h=200" alt="" width="300" height="200" class=" alignleft" /></a>There are some people who go to a tax preparer no matter how simple their taxes might be, just as there are people who spend hours preparing their own taxes every year, even though they aren&#8217;t tax professionals. The decision of whether to do your own taxes is a matter of personal choice, but there are some factors to consider that could sway you one way or the other. <span id="more-30267"></span></p>
<h3>The Home Office Deduction</h3>
<p>The home office deduction can be a particularly difficult expense to deduct. The issue is that while many web workers do use at least a part of their home as a work space, they don&#8217;t do so in a way that the IRS considers acceptable for claiming it as a deduction. A home office must be used exclusively for business purposes in order to write off a percentage of your utilities, mortgage, rent or other expenses.</p>
<p>That means you can&#8217;t use the same area for handling personal tasks, like writing a letter to Grandma. Your kids can&#8217;t play in the same room — even if you need to be able to keep one eye on them and the other on your work. Admittedly, the odds of the IRS stopping by your house and checking just how exclusively you use your home office for work are pretty low, but with taxes, it&#8217;s generally best to be safe rather than sorry. A tax preparer can help you make sure you&#8217;re on the safe side.</p>
<h3>Your Employees</h3>
<p>If you&#8217;re telecommuting as a full-time employee of a business, your taxes aren&#8217;t going to much more complicated than if you were going into the office every day. But if you run your own business, things get more complicated. If your business has grown to the point that you have employees — whether or not you see them in person — it&#8217;s generally best to start talking to a tax professional that can help you through the paperwork.</p>
<h3>Changed Status</h3>
<p>While you may not need to have your taxes entirely prepared by a professional, it&#8217;s generally worth at least consulting with a tax pro if your situation has dramatically changed over the last year. Even something as simple as switching to telecommuting full-time can be worth a call. Not all tax software can identify every single deduction or credit that might be available to you and, if it&#8217;s your first year in a new situation, you may not be aware of all of the deductions you could make.</p>
<h3>Choosing How to Do Your Taxes</h3>
<p>These issues I&#8217;ve outlined here are just starting points to consider; your tax situation may differ dramatically from every other web worker&#8217;s. If you have any concerns, it&#8217;s best to actually talk to a tax professional who you can tell about the specifics of your situation. It&#8217;s also worthwhile consulting the <a href="http://www.irs.gov/">IRS web site</a> for further information about your particular tax situation.</p>
<p><em>Do you use a tax professional?</em></p>
<p><em><a href="http://www.flickr.com/photos/alancleaver/4105756012/">Photo</a> by <a href="http://www.flickr.com/photos/alancleaver/">Flickr user Alan Cleaver</a> licensed under CC BY-ND 2.0</em></p>
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			<media:title type="html">Microsoft Phone Is Like Lipstick on a Pig</media:title>
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			<media:title type="html">Thursday Bram</media:title>
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			<media:title type="html">Income tax</media:title>
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		<title>The Dark Side of Freelancing</title>
		<link>http://gigaom.com/collaboration/the-dark-side-of-freelancing/</link>
		<comments>http://gigaom.com/collaboration/the-dark-side-of-freelancing/#comments</comments>
		<pubDate>Mon, 01 Mar 2010 17:00:57 +0000</pubDate>
		<dc:creator>Dawn Foster</dc:creator>
				<category><![CDATA[Career]]></category>
		<category><![CDATA[How Do You Work?]]></category>
		<category><![CDATA[lifestyle]]></category>
		<category><![CDATA[corporate]]></category>
		<category><![CDATA[dark side]]></category>
		<category><![CDATA[freelancing]]></category>
		<category><![CDATA[hobbies]]></category>
		<category><![CDATA[taxes]]></category>

		<guid isPermaLink="false">http://webworkerdaily.com/?p=29027</guid>
		<description><![CDATA[There are a number of downsides associated with freelancing, which is why I've made the decision to go back to a full-time corporate job as a community manager. I'll still be a web worker, but I'll be doing it as a full-time employee.<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=gigaom.com&amp;blog=14960843&amp;post=29027&amp;subd=gigaom2&amp;ref=&amp;feed=1" width="1" height="1" />]]></description>
			<content:encoded><![CDATA[<p><a href="http://gigaom2.files.wordpress.com/2010/03/270587189_a328cc9436_o.jpg"><img  title="Freelancing Is Not All Rainbows and Unicorns" src="http://gigaom2.files.wordpress.com/2010/03/270587189_a328cc9436_o.jpg?w=300&#038;h=225" alt="" width="300" height="225" class=" alignleft" /></a>I&#8217;ve been freelancing full-time for almost two years. There are so many things to love about the freelance lifestyle. I can work weird hours and rearrange my schedule on a whim to take advantage of nice weather or have the free time to do something with friends as long as I find the time to complete my client work. I like being able to work from a variety of places: my home office, a coffee shop, a friend&#8217;s office, my back porch, a park or almost any other location. I enjoy having the freedom to take on new clients (or not) based on whether the project is (or isn&#8217;t) interesting to me. I like having the ultimate level of control over my career.</p>
<p>However, it isn&#8217;t all rainbows and unicorns. There are a number of downsides associated with freelancing, which is why I&#8217;ve made the decision to go back to a full-time corporate job as a community manager. I&#8217;ll still be a web worker, collaborating with people around the world online, but I&#8217;ll be doing it as a full-time employee.</p>
<h3>Turning Hobbies Into Paying Gigs</h3>
<p>When I began freelancing, I was excited that I could turn things that I was passionate about and doing for fun as hobbies into something that people would pay me to do. I could do fun work and earn money! This worked for me for quite a while, and maybe it continues to work for some people over long periods of time. For me, those things that I used to do for fun all became work, and they became less fun as they started to feel like work. I also realized that I really didn&#8217;t have hobbies anymore, and I was just spending all of my time working, which left me burned out, tired and grouchy.</p>
<h3>Pressure</h3>
<p>On a related note, I used to enjoy speaking at conferences, blogging and attending events when I used to do them mostly out of a passion for the topic, and because they were fun. As a freelancer, these became business development opportunities. I started feeling a big weight on my shoulders and pressure to speak or write only about topics that were directly related to my consulting practice so that I could use them to get more business. Attending events shifted from hanging out with my friends and meeting new people with interesting ideas to meeting people who might need my consulting services. All of these activities became less fun as a freelancer.</p>
<h3>Logistics</h3>
<p>Anyone who has ever freelanced full-time knows that the logistics can be complex, painful, time consuming and sometimes expensive. Taxes are much more complicated and time consuming even when you have an accountant do them for you because there are so many things you need to track. Independent health care plans are expensive and not nearly as good as when you get them through your employer. Retirement savings is also more difficult, and you can&#8217;t save nearly as much in an IRA as you can with a corporate 401k, especially since most employers match at least a portion of your contribution. I can be very detail-oriented when I need to be, so I was able to manage all of the logistics without any big issues, but it was just one more thing that I didn&#8217;t enjoy doing.</p>
<p>Could I have made changes in my working style to make all of this manageable and still be happy while maintaining my sanity at the same time? Maybe. For now, the best choice for me was to go back to working for a company. I&#8217;ll still continue blogging and playing with cool technologies, but I&#8217;ll go back to doing this evenings and weekends in the hope that they start to feel less like work and more like hobbies again. If not, I&#8217;ll just have to find some new hobbies. Bridge, anyone?</p>
<p><em>What is your least favorite part of freelancing, and how do you overcome the dark side of freelancing?</em></p>
<p><a href="http://www.flickr.com/photos/weeta/270587189/">Photo</a> by <a rel="cc:attributionURL" href="http://www.flickr.com/photos/weeta/">Flickr user weeta</a>, licensed under  <a rel="license" href="http://creativecommons.org/licenses/by/2.0/">CC BY 2.0</a>.</p>
<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=gigaom.com&amp;blog=14960843&amp;post=29027&amp;subd=gigaom2&amp;ref=&amp;feed=1" width="1" height="1" />]]></content:encoded>
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		<slash:comments>21</slash:comments>
	
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			<media:title type="html">Dawn</media:title>
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		<media:content url="http://gigaom2.files.wordpress.com/2010/03/270587189_a328cc9436_o.jpg?w=300" medium="image">
			<media:title type="html">Freelancing Is Not All Rainbows and Unicorns</media:title>
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		<title>Start Now to Wrap Up 2009 and Prepare for 2010</title>
		<link>http://gigaom.com/collaboration/start-now-to-wrap-up-2009-and-prepare-for-2010/</link>
		<comments>http://gigaom.com/collaboration/start-now-to-wrap-up-2009-and-prepare-for-2010/#comments</comments>
		<pubDate>Tue, 01 Dec 2009 15:00:40 +0000</pubDate>
		<dc:creator>Dawn Foster</dc:creator>
				<category><![CDATA[Personal organization]]></category>
		<category><![CDATA[Tips & Tricks]]></category>
		<category><![CDATA[finances]]></category>
		<category><![CDATA[financial planning]]></category>
		<category><![CDATA[freelancing]]></category>
		<category><![CDATA[holiday]]></category>
		<category><![CDATA[planning]]></category>
		<category><![CDATA[tax deductions]]></category>
		<category><![CDATA[taxes]]></category>

		<guid isPermaLink="false">http://webworkerdaily.com/?p=23778</guid>
		<description><![CDATA[For those perfect freelancers who remember to carefully record and track every expense, there isn&#8217;t much to do at tax time other than hand over their perfectly organized documents to their accountant. For the less perfect among us, we probably have some work to do. I [...]<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=gigaom.com&amp;blog=14960843&amp;post=23778&amp;subd=gigaom2&amp;ref=&amp;feed=1" width="1" height="1" />]]></description>
			<content:encoded><![CDATA[<p><a href="http://webworkerdaily.files.wordpress.com/2009/11/4105756012_db89e4be50_m.jpg"><img  title="Income tax" src="http://webworkerdaily.files.wordpress.com/2009/11/4105756012_db89e4be50_m.jpg?w=240&#038;h=161" alt="" width="240" height="161" class=" alignleft" /></a>For those perfect freelancers who remember to carefully record and track every expense, there isn&#8217;t much to do at tax time other than hand over their perfectly organized documents to their accountant. For the less perfect among us, we probably have some work to do. I am reasonably good at keeping track of everything, but there are always a few things that slide and get neglected. In my previous post about <a href="http://gigaom.com/collaboration/4-tips-for-holiday-season-stress-reduction/">holiday stress reduction</a>, I talked about getting ahead on some tasks that can be accomplished early &#8212; and one of those tasks is taxes.</p>
<p>For most freelancers, December is a slower month. Our clients are taking vacations and rarely does anyone schedule a big launch in December or January. This makes December an ideal time to get our finances in order, prepare for 2009 taxes and make any adjustments in our plans for 2010.<span id="more-23778"></span></p>
<p>Everyone has a different approach to finances, taxes and planning, so rather than focus on how to do these things, I&#8217;m going to focus on questions that you should ask yourself.</p>
<ul>
<li><strong>What am I missing?</strong> This is always a hard question because if you know the answer then it isn&#8217;t really missing, but it&#8217;s a critical question to ask. Look carefully at your expenses. Have you remembered to record all 12 instances of any monthly recurring expenses (hosting, online applications, phone, etc.)? What about those special cases, like home office deductions? Do you have any small income sources that haven&#8217;t been tracked (advertising, affiliates, book / white paper sales, etc.)? Can you get a head start on documenting any other tax materials? Cross-referencing with past tax forms and bank statements can help identify any missing income or expenses.</li>
<li><strong>Are my income and expenses relatively balanced?</strong> 2010 is way too late to make adjustments for 2009, so this is a critical question to look at in December while you still have time to make changes. Depending on the answer to this question, you might decide that you can afford to make a few extra business purchases (new equipment, books, etc.) or charitable contributions in 2009, or you might decide to defer some purchases to 2010. This is a great question to ask your accountant now.</li>
<li><strong>Where do I want to be in 2011 and beyond?</strong> Your answer to this question should include financial goals, career fulfillment, and personal life balance. Once you figure out where you want to be, you need to put together a plan with the steps to get you there. What additional training do you need? What expertise needs to be further developed and practiced? Are there some additional income streams that you want to pursue?</li>
</ul>
<p>These three questions aren&#8217;t revolutionary or new, but they will hopefully serve as a nice reminder to use some of the December downtime to start thinking about wrapping up 2009 and preparing for 2010.</p>
<p><em>What other things do you do to wrap up the current year and prepare for the next?</em></p>
<p><a href="http://www.flickr.com/photos/alancleaver/4105756012/">Photo by Alan Cleaver</a> used under Creative Commons.</p>
<p><strong>Related research and analysis from GigaOM Pro:</strong><br />Subscriber content. <a href="http://pro.gigaom.com/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=23778+start-now-to-wrap-up-2009-and-prepare-for-2010&utm_content=geekygirldawn">Sign up for a free trial</a>.</p><ul><li><a href="http://pro.gigaom.com/2011/03/why-ipad-2-will-lead-consumers-into-the-post-pc-era/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=23778+start-now-to-wrap-up-2009-and-prepare-for-2010&utm_content=geekygirldawn">Why iPad 2 Will Lead Consumers Into the Post-PC&nbsp;Era</a></li><li><a href="http://pro.gigaom.com/2011/03/the-near-term-evolution-of-social-commerce/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=23778+start-now-to-wrap-up-2009-and-prepare-for-2010&utm_content=geekygirldawn">The Near-Term Evolution of Social&nbsp;Commerce</a></li><li><a href="http://pro.gigaom.com/2011/02/content-farms-the-players-the-benefits-the-risks/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=23778+start-now-to-wrap-up-2009-and-prepare-for-2010&utm_content=geekygirldawn">Content Farms: The Players, The Benefits, The&nbsp;Risks</a></li></ul><img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=gigaom.com&amp;blog=14960843&amp;post=23778&amp;subd=gigaom2&amp;ref=&amp;feed=1" width="1" height="1" />]]></content:encoded>
			<wfw:commentRss>http://gigaom.com/collaboration/start-now-to-wrap-up-2009-and-prepare-for-2010/feed/</wfw:commentRss>
		<slash:comments>3</slash:comments>
	
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			<media:title type="html">Dawn</media:title>
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			<media:title type="html">Income tax</media:title>
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		<title>WorkingPoint Upgrades For Tax Season</title>
		<link>http://gigaom.com/collaboration/workingpoint-upgrades-for-tax-season/</link>
		<comments>http://gigaom.com/collaboration/workingpoint-upgrades-for-tax-season/#comments</comments>
		<pubDate>Sat, 21 Nov 2009 14:00:45 +0000</pubDate>
		<dc:creator>Thursday Bram</dc:creator>
				<category><![CDATA[Software Apps]]></category>
		<category><![CDATA[expenses]]></category>
		<category><![CDATA[invoices]]></category>
		<category><![CDATA[taxes]]></category>
		<category><![CDATA[workingpoint]]></category>

		<guid isPermaLink="false">http://webworkerdaily.wordpress.com/?p=23185</guid>
		<description><![CDATA[Invoicing application WorkingPoint is continuing to add to its offerings. Since we first reviewed the web-based application, the team behind it has been busy. The focus of the new features is simplifying tax season for small business &#8212; and as we&#8217;re all starting to think about [...]<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=gigaom.com&amp;blog=14960843&amp;post=23185&amp;subd=gigaom2&amp;ref=&amp;feed=1" width="1" height="1" />]]></description>
			<content:encoded><![CDATA[<p><a href="http://webworkerdaily.files.wordpress.com/2009/11/tax-reports.png"><img  title="Tax Reports" src="http://webworkerdaily.files.wordpress.com/2009/11/tax-reports.png?w=300&#038;h=220" alt="" width="300" height="220" class=" alignleft" /></a>Invoicing application <a href="http://www.workingpoint.com/">WorkingPoint</a> is continuing to add to its offerings. Since <a href="http://gigaom.com/collaboration/workingpoint-effortless-invoicing/">we first reviewed</a> the web-based application, the team behind it has been busy. The focus of the new features is simplifying tax season for small business &#8212; and as we&#8217;re all starting to think about what we need to do to close the books on 2009, these new features will come in handy.<span id="more-23185"></span></p>
<p>Traditionally, there&#8217;s a lot of paperwork that goes along with ending the year and getting ready to complete your income tax return. You might have to bring together information from several different applications, trying to make a mess of information make sense. WorkingPoint&#8217;s new features are meant to make use of all the work you&#8217;ve done over the course of the year to minimize the effort you have to do in getting ready to either hand your paperwork over to a tax preparer or to do your tax return yourself. While those features are still being rolled out, they should be in place by the end of the year.</p>
<p><a href="http://webworkerdaily.files.wordpress.com/2009/11/1099_report.jpg"><img  title="1099_report" src="http://webworkerdaily.files.wordpress.com/2009/11/1099_report.jpg?w=300&#038;h=200" alt="" width="300" height="200" class=" alignleft" /></a>If you&#8217;re already using WorkingPoint to manage invoices and expenses, you&#8217;ll be able to print out tax reports that directly map your business expenses to the IRS Form 1040 Schedule C (the form used to deduct business expenses), as well as calculate your estimated income taxes and print out 1099 forms for any independent contractors you&#8217;ve worked with over the course of the year. Other new features WorkingPoint plans on adding include integration with PayPal, banks and other e-commerce tools. The application also plans to add a payroll service gateway. It is important to note that the new features are only available with a premium account.</p>
<p>As a part of the improvements that WorkingPoint is rolling out, the application&#8217;s creators have added a second user to free accounts at no additional charge. While this may not seem immediately useful for some web workers &#8212; especially freelancers or anyone else working on their own &#8212; I&#8217;ve already found a good use for it. By giving my CPA access to my invoices and other business information, I can speed up the process of getting my taxes done as well as help my CPA to provide me with relevant advice about growing my business in 2010. With access to my account, he&#8217;s able to print off his own copies of tax reports, without any hassle of mailing them in. And since I don&#8217;t have to give out my own password for my account, my business&#8217; data is a little safer.</p>
<p>The new developments at WorkingPoint serve to set this application apart from the other online invoicing tools, simply because few options provide easy ways to take all the business data you collect over the course of a year and turn it into an income tax return. WorkingPoint can save a lot of time when it comes to coordinating income, expenses and the various forms that go along with doing your taxes. If you use a tax preparer, you&#8217;ll find that you can get a faster turn around and if you do your taxes yourself, you&#8217;ll eliminate at least some of the stress.</p>
<p><em>If you&#8217;ve tried WorkingPoint, let us know how it worked out for you below.</em></p>
<p><strong>Related research and analysis from GigaOM Pro:</strong><br />Subscriber content. <a href="http://pro.gigaom.com/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=23185+workingpoint-upgrades-for-tax-season&utm_content=thursdayb">Sign up for a free trial</a>.</p><ul><li><a href="http://pro.gigaom.com/2011/03/why-ipad-2-will-lead-consumers-into-the-post-pc-era/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=23185+workingpoint-upgrades-for-tax-season&utm_content=thursdayb">Why iPad 2 Will Lead Consumers Into the Post-PC&nbsp;Era</a></li><li><a href="http://pro.gigaom.com/2011/03/the-near-term-evolution-of-social-commerce/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=23185+workingpoint-upgrades-for-tax-season&utm_content=thursdayb">The Near-Term Evolution of Social&nbsp;Commerce</a></li><li><a href="http://pro.gigaom.com/2011/02/content-farms-the-players-the-benefits-the-risks/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=23185+workingpoint-upgrades-for-tax-season&utm_content=thursdayb">Content Farms: The Players, The Benefits, The&nbsp;Risks</a></li></ul><img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=gigaom.com&amp;blog=14960843&amp;post=23185&amp;subd=gigaom2&amp;ref=&amp;feed=1" width="1" height="1" />]]></content:encoded>
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		<slash:comments>3</slash:comments>
	
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			<media:title type="html">Thursday Bram</media:title>
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			<media:title type="html">Tax Reports</media:title>
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		<title>Outright and Network Solutions Connect to Bring Business Online</title>
		<link>http://gigaom.com/collaboration/outright-and-network-solutions-connect-to-bring-business-online/</link>
		<comments>http://gigaom.com/collaboration/outright-and-network-solutions-connect-to-bring-business-online/#comments</comments>
		<pubDate>Thu, 11 Jun 2009 14:00:59 +0000</pubDate>
		<dc:creator>Scott Blitstein</dc:creator>
				<category><![CDATA[CNN Startups]]></category>
		<category><![CDATA[NYT Startups]]></category>
		<category><![CDATA[Software Apps]]></category>
		<category><![CDATA[SYN Feature Enterprise]]></category>
		<category><![CDATA[bookkeeping]]></category>
		<category><![CDATA[domain name]]></category>
		<category><![CDATA[Network Solutions]]></category>
		<category><![CDATA[outright]]></category>
		<category><![CDATA[taxes]]></category>

		<guid isPermaLink="false">http://webworkerdaily.com/?p=14136</guid>
		<description><![CDATA[I&#8217;ve written in the past about the handy features of bookkeeping and tax preparation service Outright. Its easy-to-use interface and integration with other apps make it almost a no-brainer for small business that aren&#8217;t satisfied with their existing accounting process. As we&#8217;re at the midyear point, [...]<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=gigaom.com&amp;blog=14960843&amp;post=14136&amp;subd=gigaom2&amp;ref=&amp;feed=1" width="1" height="1" />]]></description>
			<content:encoded><![CDATA[<p><img  title="Outright logo" src="http://gigaom2.files.wordpress.com/2009/06/img_outright_logo.png?w=258&#038;h=65&#038;h=65" alt="" width="258" height="65" class=" alignleft" />I&#8217;ve <a title="WWD - Simple bookkeeping make outright really shine" href="http://gigaom.com/collaboration/simple-bookkeeping-easy-tax-prep-make-outright-really-shine/">written in the past</a> about the handy features of bookkeeping and tax preparation service <a title="Outright - Home" href="http://outright.com">Outright</a>.  Its easy-to-use interface and integration with other apps make it almost a no-brainer for small business that aren&#8217;t satisfied with their existing accounting process.</p>
<p>As we&#8217;re at the midyear point, now is a good time to evaluate how prepared you are for tax preparation, rather than wait for year end. To sweeten the deal a bit, the folks at Outright have partnered with <a title="Network Solutions - Home" href="http://www.networksolutions.com/">Network Solutions</a> to offer a <a href="http://blog.outright.com/self-employment/some-help-for-entrepreneursget-a-free-web-site-addresses-and-business-profile-page/">free domain name and business profile page</a> for one year to new signups. The promotion runs through until the end of July.</p>
<p>If you don&#8217;t already have a web presence, this might be a great way to get yourself online, and to get the bookkeeping and tax preparation benefits of Outright.  Just register as normal with Outright and they&#8217;ll send you the details on how to get your domain name. It is estimated that 50 percent to 60 percent of small businesses do not yet have an online presence; offers like this can give people the ability to take the plunge and move their business to the web.</p>
<p>What I really like about this offer is that it is very much in the spirit of the <a title="WWD - Is the small business web the next big thing" href="http://gigaom.com/collaboration/is-the-small-business-web-the-next-big-thing/">Small Business Web</a> movement that I think is tremendously important for the long-term success of web services. While not an integration move, it shows how service providers can work together to bring a real benefit to their small business users.  I&#8217;ve watched these interactions and relationships develop online and am thrilled to see real benefits coming out of these partnerships.</p>
<p><em>Is your business online?  Could you use a free domain name?</em></p>
<p><strong>Related research and analysis from GigaOM Pro:</strong><br />Subscriber content. <a href="http://pro.gigaom.com/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=14136+outright-and-network-solutions-connect-to-bring-business-online&utm_content=scottblitz">Sign up for a free trial</a>.</p><ul><li><a href="http://pro.gigaom.com/2011/03/why-ipad-2-will-lead-consumers-into-the-post-pc-era/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=14136+outright-and-network-solutions-connect-to-bring-business-online&utm_content=scottblitz">Why iPad 2 Will Lead Consumers Into the Post-PC&nbsp;Era</a></li><li><a href="http://pro.gigaom.com/2011/03/the-near-term-evolution-of-social-commerce/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=14136+outright-and-network-solutions-connect-to-bring-business-online&utm_content=scottblitz">The Near-Term Evolution of Social&nbsp;Commerce</a></li><li><a href="http://pro.gigaom.com/2011/02/content-farms-the-players-the-benefits-the-risks/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=14136+outright-and-network-solutions-connect-to-bring-business-online&utm_content=scottblitz">Content Farms: The Players, The Benefits, The&nbsp;Risks</a></li></ul><img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=gigaom.com&amp;blog=14960843&amp;post=14136&amp;subd=gigaom2&amp;ref=&amp;feed=1" width="1" height="1" />]]></content:encoded>
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		<slash:comments>2</slash:comments>
	
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			<media:title type="html">scottblitz</media:title>
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		<media:content url="http://gigaom2.files.wordpress.com/2009/06/img_outright_logo.png?w=258&#38;h=65" medium="image">
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		<title>Build a Twitter-Monitoring Dashboard Using TweetGrid</title>
		<link>http://gigaom.com/collaboration/build-a-twitter-monitoring-dashboard-using-tweetgrid/</link>
		<comments>http://gigaom.com/collaboration/build-a-twitter-monitoring-dashboard-using-tweetgrid/#comments</comments>
		<pubDate>Mon, 04 May 2009 23:00:27 +0000</pubDate>
		<dc:creator>Simon Mackie</dc:creator>
				<category><![CDATA[Locations & Services]]></category>
		<category><![CDATA[NYT Internet]]></category>
		<category><![CDATA[Policy]]></category>
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		<category><![CDATA[monitoring dashboard]]></category>
		<category><![CDATA[Obama]]></category>
		<category><![CDATA[scree]]></category>
		<category><![CDATA[screencast]]></category>
		<category><![CDATA[taxes]]></category>
		<category><![CDATA[Twitter]]></category>
		<category><![CDATA[vc]]></category>
		<category><![CDATA[venture capital]]></category>

		<guid isPermaLink="false">http://webworkerdaily.com/?p=12166</guid>
		<description><![CDATA[There&#8217;s a huge amount of interesting conversation happening all the time on Twitter, about your company, your project, and countless other things in which you&#8217;re interested. But keeping track of all those conversations is hard. That&#8217;s where free web app TweetGrid comes in. It enables you [...]<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=gigaom.com&amp;blog=14960843&amp;post=78552&amp;subd=gigaom2&amp;ref=&amp;feed=1" width="1" height="1" />]]></description>
			<content:encoded><![CDATA[<p>There&#8217;s a huge amount of interesting conversation happening all the time on Twitter, about your company, your project, and countless other things in which you&#8217;re interested. But keeping track of all those conversations is hard. That&#8217;s where free web app <a href="http://www.tweetgrid.com/">TweetGrid</a> comes in. It enables you to easily build a <a href="http://gigaom.com/collaboration/make-a-monitoring-dashboard-to-track-conversations/">monitoring dashboard</a> to track topics by arranging real-time Twitter searches in a customizable grid layout.</p>
<p>While some Twitter desktop clients, like <a href="http://www.tweetdeck.com/beta/">Tweetdeck</a>, have this kind of functionality, Tweetgrid is interesting because it&#8217;s a web app; you don&#8217;t need to download anything or even need a Twitter login to use it. You can search for terms, hashtags and conversations and you can save your dashboard just by bookmarking the page.</p>
<p>Here&#8217;s a quick screencast showing what it can do:<br />
<object classid="clsid:d27cdb6e-ae6d-11cf-96b8-444553540000" width="500" height="425" codebase="http://download.macromedia.com/pub/shockwave/cabs/flash/swflash.cab#version=6,0,40,0"><param name="allowfullscreen" value="true" /><param name="allowscriptaccess" value="always" /><param name="src" value="http://vimeo.com/moogaloop.swf?clip_id=4475625&amp;server=vimeo.com&amp;show_title=1&amp;show_byline=1&amp;show_portrait=0&amp;color=00ADEF&amp;fullscreen=1" /><embed type="application/x-shockwave-flash" width="500" height="425" src="http://vimeo.com/moogaloop.swf?clip_id=4475625&amp;server=vimeo.com&amp;show_title=1&amp;show_byline=1&amp;show_portrait=0&amp;color=00ADEF&amp;fullscreen=1" allowscriptaccess="always" allowfullscreen="true"></embed></object></p>
<p><a href="http://vimeo.com/4475625">WWD Screencast: TweetGrid</a> from <a href="http://vimeo.com/user1441854">WebWorkerDaily</a> on <a href="http://vimeo.com">Vimeo</a>.</p>
<p><em>What do you use for monitoring Twitter buzz?</em></p>
<p>(via <a href="http://www.downloadsquad.com/2009/04/30/tweet-grid-is-a-no-login-way-to-monitor-multiple-twitter-searche/">DownloadSquad</a>)</p>
<p><strong>Related research and analysis from GigaOM Pro:</strong><br />Subscriber content. <a href="http://pro.gigaom.com/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=78552+build-a-twitter-monitoring-dashboard-using-tweetgrid&utm_content=simonmackie">Sign up for a free trial</a>.</p><ul><li><a href="http://pro.gigaom.com/2011/03/the-near-term-evolution-of-social-commerce/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=78552+build-a-twitter-monitoring-dashboard-using-tweetgrid&utm_content=simonmackie">The Near-Term Evolution of Social&nbsp;Commerce</a></li><li><a href="http://pro.gigaom.com/2011/02/a-2011-connected-consumer-forecast/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=78552+build-a-twitter-monitoring-dashboard-using-tweetgrid&utm_content=simonmackie">A 2011 Connected Consumer&nbsp;Forecast</a></li><li><a href="http://pro.gigaom.com/2011/02/a-2011-newnet-forecast/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=78552+build-a-twitter-monitoring-dashboard-using-tweetgrid&utm_content=simonmackie">A 2011 NewNet&nbsp;Forecast</a></li></ul><img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=gigaom.com&amp;blog=14960843&amp;post=78552&amp;subd=gigaom2&amp;ref=&amp;feed=1" width="1" height="1" />]]></content:encoded>
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		<slash:comments>4</slash:comments>
	
		<media:content url="http://0.gravatar.com/avatar/8d5d3263a23d1788479715dd49b2cef8?s=96&#38;d=retro&#38;r=PG" medium="image">
			<media:title type="html">simonmackie</media:title>
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		<title>Simple Bookkeeping, Easy Tax Prep Make Outright Really Shine</title>
		<link>http://gigaom.com/collaboration/simple-bookkeeping-easy-tax-prep-make-outright-really-shine/</link>
		<comments>http://gigaom.com/collaboration/simple-bookkeeping-easy-tax-prep-make-outright-really-shine/#comments</comments>
		<pubDate>Wed, 01 Apr 2009 14:00:10 +0000</pubDate>
		<dc:creator>Scott Blitstein</dc:creator>
				<category><![CDATA[Business/Finance]]></category>
		<category><![CDATA[CNN Startups]]></category>
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		<category><![CDATA[bookkeeping]]></category>
		<category><![CDATA[freshbooks]]></category>
		<category><![CDATA[odesk]]></category>
		<category><![CDATA[outright]]></category>
		<category><![CDATA[Shoeboxed]]></category>
		<category><![CDATA[taxes]]></category>

		<guid isPermaLink="false">http://webworkerdaily.com/?p=10227</guid>
		<description><![CDATA[As we approach April 15th and tax time, it is normal for us to think about how we maintain our books and evaluate if our current process is working for us.

While there are no shortages of accounting programs available, with varying levels of complexity and pricing, it can be difficult for a small shop to find the right solution. Focusing on ease of use and integration with other web apps, Outright is a great choice for web workers.<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=gigaom.com&amp;blog=14960843&amp;post=10227&amp;subd=gigaom2&amp;ref=&amp;feed=1" width="1" height="1" />]]></description>
			<content:encoded><![CDATA[<p><a href="http://outright.com"><img  title="Outright Logo" src="http://webworkerdaily.files.wordpress.com/2009/03/img_outright_logo.png?w=258&#038;h=65" alt="Outright Logo" width="258" height="65" class=" alignleft" /></a>As we approach April 15th and tax time, it is normal for us to think about how we maintain our books and evaluate if our current process is working for us.</p>
<p>While there&#8217;s no shortage of accounting programs available, with varying levels of complexity and pricing, it can be difficult for a small shop to find the right solution. Focusing on ease of use and integration with other web apps, <a title="Outright - Home" href="http://outright.com">Outright</a> is a great choice for web workers.</p>
<p><span id="more-10227"></span></p>
<p><img  title="Outright Profit" src="http://webworkerdaily.files.wordpress.com/2009/03/img_outright_profit.png?w=172&#038;h=117" alt="Outright Profit" width="172" height="117" class=" alignleft" /></p>
<p>In reality, the accounting needs of the average solo web worker are usually pretty modest. Record the money in (income) versus your money out (expenses) and be prepared to pay your taxes when they&#8217;re due.</p>
<p>At its core, Outright is a basic web service designed to allow you to easily track your expenses and income. Using a familiar check register interface, you enter in transaction details and get quick and simple access to the general health of your business.</p>
<p>As a member of the <a title="WWD - The Small Business Web" href="http://gigaom.com/collaboration/is-the-small-business-web-the-next-big-thing/">Small Business Web</a> initiative I wrote about recently, Outright integrates well with <a title="Freshbooks - Home" href="http://freshbooks.com">FreshBooks</a>, the invoicing app, and <a title="Shoeboxed - Home" href="http://shoeboxed.com">Shoeboxed</a>, the receipt organizer (both also SBW members).</p>
<p>In fact, it is when used in conjunction with these other apps that Outright really stands out.  While it has all the right things to make data entry easy, like auto-complete and keyboard shortcuts, nothing could be easier than having your existing invoice and expense data imported automatically.  When connected to your Freshbooks or Shoeboxed accounts, all transactions are updated nightly and even maintain a link connection so you can get to the original source quickly.</p>
<p>There are some challenges with this integration, though. For example, Outright exclusively uses the categories from  <a href="http://www.irs.gov/pub/irs-pdf/f1040sc.pdf">Schedule C</a> but since Shoeboxed doesn&#8217;t have that limitation, there are instances when it is necessary to manually re-assign a category to synced records.</p>
<p>I think the folks at Outright don&#8217;t stress enough the tax preparation angle when describing the usefulness of their service. With email reminders when quarterly payments are due, estimated payment amounts and a really handy Schedule C printout, using Outright just for the tax preparation functionality alone might make great sense.</p>
<p><img  title="Outright Schedule C" src="http://webworkerdaily.files.wordpress.com/2009/03/img_outright_schedc.jpg?w=448&#038;h=275" alt="Outright Schedule C" width="448" height="275" class=" alignleft" /></p>
<p>If you&#8217;re already using Freshbooks or Shoeboxed, then getting an Outright account is almost a no-brainer. But even if you&#8217;re not using these apps, then Outright is still a very good choice for basic expense and income tracking.</p>
<p><a title="oDesk - Home" href="http://odesk.com">oDesk</a> integration was also recently added, and I imagine support for other apps is coming soon, so it might be a good idea to check in occasionally and see if they are supporting your app of choice.</p>
<p><a title="Outright - Home" href="http://outright.com">Outright</a> is free during the beta period and works wherever you have a browser and Internet connection.</p>
<p><em>How do you manage your books?</em></p>
<p><strong>Related research and analysis from GigaOM Pro:</strong><br />Subscriber content. <a href="http://pro.gigaom.com/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=10227+simple-bookkeeping-easy-tax-prep-make-outright-really-shine&utm_content=scottblitz">Sign up for a free trial</a>.</p><ul><li><a href="http://pro.gigaom.com/2010/11/are-web-apps-becoming-over-reliant-on-one-another/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=10227+simple-bookkeeping-easy-tax-prep-make-outright-really-shine&utm_content=scottblitz">Are Web Apps Becoming Over-Reliant on One&nbsp;Another?</a></li><li><a href="http://pro.gigaom.com/2009/08/enterprise-2-0-web-apps-and-the-patchwork-quilt-problem/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=10227+simple-bookkeeping-easy-tax-prep-make-outright-really-shine&utm_content=scottblitz">Enterprise 2.0: Web Apps and the Patchwork Quilt&nbsp;Problem</a></li><li><a href="http://pro.gigaom.com/2010/12/report-high-impact-collaboration-in-the-enterprise/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=10227+simple-bookkeeping-easy-tax-prep-make-outright-really-shine&utm_content=scottblitz">Report: High-Impact Collaboration in the&nbsp;Enterprise</a></li></ul><img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=gigaom.com&amp;blog=14960843&amp;post=10227&amp;subd=gigaom2&amp;ref=&amp;feed=1" width="1" height="1" />]]></content:encoded>
			<wfw:commentRss>http://gigaom.com/collaboration/simple-bookkeeping-easy-tax-prep-make-outright-really-shine/feed/</wfw:commentRss>
		<slash:comments>5</slash:comments>
	
		<media:content url="http://1.gravatar.com/avatar/916644ba552abe1d9794c3e8631d493d?s=96&#38;d=retro&#38;r=PG" medium="image">
			<media:title type="html">scottblitz</media:title>
		</media:content>

		<media:content url="http:///2009/03/img_outright_logo.png" medium="image">
			<media:title type="html">Outright Logo</media:title>
		</media:content>

		<media:content url="http:///2009/03/img_outright_profit.png" medium="image">
			<media:title type="html">Outright Profit</media:title>
		</media:content>

		<media:content url="http:///2009/03/img_outright_schedc.jpg" medium="image">
			<media:title type="html">Outright Schedule C</media:title>
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		<title>Dealing with Taxes on Your Own</title>
		<link>http://gigaom.com/collaboration/dealing-with-taxes-on-your-own/</link>
		<comments>http://gigaom.com/collaboration/dealing-with-taxes-on-your-own/#comments</comments>
		<pubDate>Wed, 11 Mar 2009 20:00:36 +0000</pubDate>
		<dc:creator>Meryl K Evans</dc:creator>
				<category><![CDATA[CNN Startups]]></category>
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		<category><![CDATA[bookkeeping]]></category>
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		<category><![CDATA[taxes]]></category>

		<guid isPermaLink="false">http://webworkerdaily.com/?p=8915</guid>
		<description><![CDATA[Not understanding bookkeeping, taxes and other administrative tasks can be very off-putting for people looking to start their own businesses. But in reality, they're not that hard to do if you're organized and get a little professional help.

Now, I'm not a CPA and the closest I've come to taking accounting is being a professor's assistant in an online graduate program course. However, I must do something right as I've been on my own for over four years and my business tax payments remain on target. So here I'm going to share what I do, as it might work for you or give you ideas on how you can keep on top of your business finances.<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=gigaom.com&amp;blog=14960843&amp;post=78490&amp;subd=gigaom2&amp;ref=&amp;feed=1" width="1" height="1" />]]></description>
			<content:encoded><![CDATA[<p>Not understanding bookkeeping, taxes and other administrative tasks can be very off-putting for people thinking about starting their own business. But in reality, these tasks are not that hard to do if you&#8217;re organized and get a little professional help.</p>
<p>Now, I&#8217;m not a CPA, and the closest I&#8217;ve come to taking accounting is being a professor&#8217;s assistant in an online graduate program course. However, I must do something right as I&#8217;ve been on my own for over four years and my business tax payments remain on target. So here I&#8217;m going to share what I do, as it might work for you or give you ideas on how you can keep on top of your business finances.</p>
<p>I keep it simple by having just two tools in my accounting toolbox: <a href="http://quickbooks.intuit.com/">QuickBooks</a> and <a href="http://www.eftps.gov/eftps/">Electronic Federal Tax Payment System (EFTPS)</a>. Substitute QuickBooks with your favorite accounting application to make this process work for you. I tend to pick up new software fast, but not so with QuickBooks. Regardless, it takes care of all of my invoicing, expensing and tax needs. But we won&#8217;t go into that. My way is just one way; check the comments on this post to see a bunch of great ways <a href="http://gigaom.com/collaboration/open-thread-how-do-you-handle-your-taxes/">to handle your taxes</a>.</p>
<p>There are two things you need to do:</p>
<ul>
<li>Track income and expenses.</li>
<li>Pay quarterly taxes (otherwise known as 1040-ES).<span id="more-78490"></span></li>
</ul>
<p><strong>Track Income and Expenses</strong></p>
<p>How do you invoice customers and track payment? What about tracking things you buy for your business? Applications like QuickBooks make it easy to create reports to see your income and expenses by quarter, year, fiscal year or customized period.</p>
<p>Keep all of your receipts for expenses related to your business. Don&#8217;t worry about organizing them. Grab a cheap expandable folder and throw them in there. Write or label it, &#8220;Business receipts.&#8221; For electronic receipts, create a folder in your email account with the same name. Or if you&#8217;re an organized freak like me, scan your receipts and save them in a folder.</p>
<p>Remember that anything related to web working counts as an expense, including your <a href="http://gigaom.com/collaboration/home-office-deduction/">home office space</a> (but verify this with your accountant) and family printer, along with its toner or cartridge replacements. Any time you take the car to buy supplies or to attend an event where you meet with folks on business, track the car&#8217;s mileage. Tax law allows you to deduct a set amount for mileage (again, check with an accountant as this varies per year). Paying for parking at the event also counts. Magazines and books related to your profession make the cut as expenses. Add the cell phone, landline phone and any other communications services. Record all purchases in your accounting software on a regular basis so you can deduct the expenses when quarterly tax time rolls around.</p>
<p><strong>Pay Quarterly Taxes</strong></p>
<p>It definitely helps to have a good accountant you can go to, especially for advice on state laws. Or you can brave it and do the research yourself (but I&#8217;ll wish you luck decoding bureaucrat-speak). My family has relied on an accountant since before I went into business for myself. They can find deductions you might not think about. A good accountant is worth way more than what you pay them.</p>
<p>Unless you&#8217;re a full-time employee with a company that already does the deductions for you, you need to pay federal taxes (1040-ES) on a quarterly basis. <a href="http://www.eftps.gov/eftps/">EFTPS Online</a> makes it very easy for American web workers to pay online or over the phone. The service costs nothing, stays open 24/7 and accepts payments in advance.</p>
<p><a href="http://www.irs.gov/publications/p505/ch02.html#d0e4494">According to the IRS</a>:</p>
<blockquote><p>Estimated tax is the method used to pay tax on income that is not subject to withholding. This includes income from self-employment, interest, dividends, alimony, rent, gains from the sale of assets, prizes, and awards. You also may have to pay estimated tax if the amount of income tax being withheld from your salary, pension, or other income is not enough.</p></blockquote>
<p>As a sole freelance web worker, I pay 1040-ES on a quarterly basis. The due dates for the quarterly payments are as follows, along with the periods they cover:</p>
<ul>
<li>April 15: Jan. 1 &#8211; March 31</li>
<li>June 15: April 1 &#8211; May 31</li>
<li>Sept. 15: June 1 &#8211; Aug. 31</li>
<li>Jan. 15: Sept. 1 &#8211; Dec. 31 of the previous year</li>
</ul>
<p>For those payment days falling on a weekend or holiday, the payment is due the following Monday.</p>
<p>EFTPS lets you set up an account with your taxpayer identification number, which is either your social security number (SSN) or employer identification number (EIN). You also provide your bank account information so you pay your taxes directly without writing a check. I&#8217;ve been doing this for years without problems.</p>
<p>So how do you know how much to pay? My method is simple, but it may not apply or work for you. For me, I base the amount owed on my household&#8217;s tax bracket. Here&#8217;s an example for someone who falls in the 20 percent bracket.</p>
<ol>
<li>Figure out earnings for the quarter. From Jan. 1 &#8211; March 31, you bring in an income of $10,000.</li>
<li>Figure out the expenses for the same quarter: $500.</li>
<li>Take the income and subtract the expenses for the final number of $9500.</li>
<li> Multiply the final number by the bracket. Here it&#8217;s 9500 x .2 (20 percent) = $1900.</li>
</ol>
<p>$1,900 is what Mr. Example owes for the quarter on April 15. I use this formula and it has yet to fail me. Your tax bracket may change, as it has for me. Just change the percent part of the formula as needed. The <a href="http://www.irs.gov/publications/p505/ch02.html#d0e7045">IRS web site also provides illustrated examples using its worksheet</a>.</p>
<p>Take advantage of your accountant&#8217;s time and find out your tax bracket percentage and what deductions to consider for the next tax year. For example, if your family plans to take a summer trip (lucky you! May I come?), find a way to do business while on the trip so you can deduct parts of it.</p>
<p><em>How do you manage your taxes?</em></p>
<p><strong>Related research and analysis from GigaOM Pro:</strong><br />Subscriber content. <a href="http://pro.gigaom.com/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=78490+dealing-with-taxes-on-your-own&utm_content=meryldotnet">Sign up for a free trial</a>.</p><ul><li><a href="http://pro.gigaom.com/2011/03/why-ipad-2-will-lead-consumers-into-the-post-pc-era/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=78490+dealing-with-taxes-on-your-own&utm_content=meryldotnet">Why iPad 2 Will Lead Consumers Into the Post-PC&nbsp;Era</a></li><li><a href="http://pro.gigaom.com/2011/03/the-near-term-evolution-of-social-commerce/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=78490+dealing-with-taxes-on-your-own&utm_content=meryldotnet">The Near-Term Evolution of Social&nbsp;Commerce</a></li><li><a href="http://pro.gigaom.com/2011/02/content-farms-the-players-the-benefits-the-risks/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=78490+dealing-with-taxes-on-your-own&utm_content=meryldotnet">Content Farms: The Players, The Benefits, The&nbsp;Risks</a></li></ul><img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=gigaom.com&amp;blog=14960843&amp;post=78490&amp;subd=gigaom2&amp;ref=&amp;feed=1" width="1" height="1" />]]></content:encoded>
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		<slash:comments>4</slash:comments>
	
		<media:content url="http://0.gravatar.com/avatar/ce124ebbe27bd13fda22676872f26ac9?s=96&#38;d=retro&#38;r=PG" medium="image">
			<media:title type="html">meryldotnet</media:title>
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		<title>Don&#039;t Forget &#8211; Independent Contractor 1099 Forms Due Soon</title>
		<link>http://gigaom.com/collaboration/dont-forget-independent-contractor-1099-forms-due-soon/</link>
		<comments>http://gigaom.com/collaboration/dont-forget-independent-contractor-1099-forms-due-soon/#comments</comments>
		<pubDate>Wed, 14 Jan 2009 19:20:30 +0000</pubDate>
		<dc:creator>Scott Blitstein</dc:creator>
				<category><![CDATA[Business/Finance]]></category>
		<category><![CDATA[Mobile Tech]]></category>
		<category><![CDATA[Software Apps]]></category>
		<category><![CDATA[1099]]></category>
		<category><![CDATA[contractors]]></category>
		<category><![CDATA[taxes]]></category>

		<guid isPermaLink="false">http://webworkerdaily.com/?p=6260</guid>
		<description><![CDATA[If you run a small business and hire any independent contractors, here is a reminder that the deadline for the processing and sending of your 1099 forms is February 2nd, just a couple of weeks away.  I know from experience in my client work that it [...]<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=gigaom.com&amp;blog=14960843&amp;post=78301&amp;subd=gigaom2&amp;ref=&amp;feed=1" width="1" height="1" />]]></description>
			<content:encoded><![CDATA[<p>If you run a small business and hire any independent contractors, here is a reminder that the deadline for the processing and sending of your 1099 forms is February 2nd, just a couple of weeks away.  I know from experience in my client work that it can be a tedious and laborious process and is something that most seem to put off until the last minute.</p>
<p>While most accounting software packages like QuickBooks have functionality for tracking these details and printing the forms you need, there are other options available as well.  We&#8217;ve covered the <a title="PayCycle" href="http://paycycle.com">PayCycle</a> service <a title="WWD - PayCycle Makes Online Payroll Even Easier" href="http://gigaom.com/collaboration/paycycle-makes-online-payroll-even-easier">in the past</a> as an option for all of your payroll needs but even if you aren&#8217;t a current customer, they offer a 1099-MISC E-File service which can help you get these forms mailed out on time.</p>
<p><img src="http://gigaom2.files.wordpress.com/2009/01/img-paycycle-1099.png?w=265&#038;h=196" alt="PayCycle - Print 1099s" width="265" height="196"  class=" alignright" /></p>
<p>The PayCycle process is 3 steps &#8211; enter the information online, print the forms  and then e-file with a single click.  You&#8217;ll still need to compile the totals and manually enter in the data but it sure beats typing or filling out the forms by hand.  I also like the fact that it prints on plain paper as the forms can be expensive and I know I always mess up the alignment on at least a couple of them.</p>
<p>Until January 27th you can print and file  up to 50 forms for  $25.00.  Get more information or <a title="PayCycle - 1099 E-File Service" href="http://www.paycycle.com/external/business/1099.jsp?name=left">sign up</a> online with PayCycle.</p>
<p><em>Have you processed your 1099 forms yet?</em></p>
<p><strong>Related research and analysis from GigaOM Pro:</strong><br />Subscriber content. <a href="http://pro.gigaom.com/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=78301+dont-forget-independent-contractor-1099-forms-due-soon&utm_content=scottblitz">Sign up for a free trial</a>.</p><ul><li><a href="http://pro.gigaom.com/2011/03/why-ipad-2-will-lead-consumers-into-the-post-pc-era/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=78301+dont-forget-independent-contractor-1099-forms-due-soon&utm_content=scottblitz">Why iPad 2 Will Lead Consumers Into the Post-PC&nbsp;Era</a></li><li><a href="http://pro.gigaom.com/2011/03/the-near-term-evolution-of-social-commerce/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=78301+dont-forget-independent-contractor-1099-forms-due-soon&utm_content=scottblitz">The Near-Term Evolution of Social&nbsp;Commerce</a></li><li><a href="http://pro.gigaom.com/2011/02/content-farms-the-players-the-benefits-the-risks/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=78301+dont-forget-independent-contractor-1099-forms-due-soon&utm_content=scottblitz">Content Farms: The Players, The Benefits, The&nbsp;Risks</a></li></ul><img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=gigaom.com&amp;blog=14960843&amp;post=78301&amp;subd=gigaom2&amp;ref=&amp;feed=1" width="1" height="1" />]]></content:encoded>
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			<media:title type="html">PayCycle - Print 1099s</media:title>
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		<title>Web Worker 101: Working with Subcontractors</title>
		<link>http://gigaom.com/collaboration/web-worker-101-subcontractors/</link>
		<comments>http://gigaom.com/collaboration/web-worker-101-subcontractors/#comments</comments>
		<pubDate>Sun, 24 Aug 2008 21:50:00 +0000</pubDate>
		<dc:creator>Mike Gunderloy</dc:creator>
				<category><![CDATA[How Do You Work?]]></category>
		<category><![CDATA[subcontractors]]></category>
		<category><![CDATA[taxes]]></category>
		<category><![CDATA[web worker 101]]></category>

		<guid isPermaLink="false">http://webworkerdaily.wordpress.com/?p=3498</guid>
		<description><![CDATA[If you&#8217;ve reached the point of having more work than you can handle, there are several ways to handle the overflow. One of the easiest, in some ways, is to hire subcontractors to do part of the work for you. But before you rush out and [...]<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=gigaom.com&amp;blog=14960843&amp;post=3498&amp;subd=gigaom2&amp;ref=&amp;feed=1" width="1" height="1" />]]></description>
			<content:encoded><![CDATA[<p><a title="View 'Screenshot' on Flickr.com" href="http://www.flickr.com/photos/8304862@N03/2793537620"><img src="http://farm4.static.flickr.com/3176/2793537620_3b9cfd216e_m.jpg" border="0" alt="Screenshot" width="240" height="180"  class=" alignright" /></a>If you&#8217;ve reached the point of having <a href="http://gigaom.com/collaboration/do-you-want-more-web-work/">more work than you can handle</a>, there are several ways to handle the overflow. One of the easiest, in some ways, is to hire subcontractors to do part of the work for you. But before you rush out and offer part of your next job to your closest web-working buddy, there are a few things that you need to consider. Here are four of the biggest pitfalls to watch out for.</p>
<p><strong>1. No Handshake Deals</strong> &#8211; If you&#8217;re going to bring on a subcontractor, make sure you both sign a contract laying out what the job is and how much you&#8217;ll be paying. I&#8217;ve sung this tune in the past, and I&#8217;ll sing it again: a contract won&#8217;t prevent all possible disagreements, but it will eliminate many and give you a basis for resolving the rest. If you ever have a job go completely sour on you, to the point where your client won&#8217;t pay, then you&#8217;ll be happy to have a contract spelling out your responsibilities in place.</p>
<p><span id="more-3498"></span></p>
<p><strong>2. Be Serious About Taxes</strong>. That&#8217;s a general <a href="http://gigaom.com/collaboration/six-things-you-must-know-about-self-employment-taxes/">rule of thumb</a> for web work, of course. But it&#8217;s even more important if you&#8217;re dealing with money for multiple people. Worst case: you end up owing money because of what you&#8217;ve paid to contractors, as well as what you kept for yourself. I&#8217;m not an accountant, but at the absolute minimum, you need to get a W9 or W8 form from every subcontractor, or withhold money off the top. You also need to ensure that you don&#8217;t accidentally <a href="http://www.irs.gov/businesses/small/article/0,,id=99921,00.html">treat them as employees</a>, or pay the price in increased paperwork and liability. These rules are for the US, of course, but there are analogous issues in most countries.</p>
<p><strong>3. Treat Your Subs Fairly</strong>. There may be short-term profit in handing off the worst work to subcontractors and underpaying them, but that&#8217;s no way to build a long-term relationship. You&#8217;d be far better off to treat contractors the way you yourself would like to be treated in their shoes. That means paying a fair rate for the work that you sub out, as well as assuming your share of the risk.</p>
<p><strong>4. Choose Subcontractors Wisely</strong>. I won&#8217;t say that you should never <a href="http://gigaom.com/collaboration/do-you-dare-to-work-with-friends/">work with friends</a>, but I&#8217;ve seen far more relationships busted up by going into business together than I&#8217;ve seen strengthened. You&#8217;ll also want to beware of using the job-bidding sites to send work out to the absolute cheapest subcontractor. Treat this as any other hiring opportunity: ask for references, interview people, and don&#8217;t just grab the first person you run across.</p>
<p>While paying attention to these four areas won&#8217;t guarantee a good subcontracting experience, ignoring them is almost certain to bring about a bad one.</p>
<p><em>What tips do you have for working with subcontractors?</em></p>
<p>image: stock.xchng user <a href="http://www.sxc.hu/profile/clix">clix</a></p>
<p><strong>Related research and analysis from GigaOM Pro:</strong><br />Subscriber content. <a href="http://pro.gigaom.com/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=3498+web-worker-101-subcontractors&utm_content=ffmike">Sign up for a free trial</a>.</p><ul><li><a href="http://pro.gigaom.com/2011/03/why-ipad-2-will-lead-consumers-into-the-post-pc-era/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=3498+web-worker-101-subcontractors&utm_content=ffmike">Why iPad 2 Will Lead Consumers Into the Post-PC&nbsp;Era</a></li><li><a href="http://pro.gigaom.com/2011/03/the-near-term-evolution-of-social-commerce/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=3498+web-worker-101-subcontractors&utm_content=ffmike">The Near-Term Evolution of Social&nbsp;Commerce</a></li><li><a href="http://pro.gigaom.com/2011/02/content-farms-the-players-the-benefits-the-risks/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=3498+web-worker-101-subcontractors&utm_content=ffmike">Content Farms: The Players, The Benefits, The&nbsp;Risks</a></li></ul><img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=gigaom.com&amp;blog=14960843&amp;post=3498&amp;subd=gigaom2&amp;ref=&amp;feed=1" width="1" height="1" />]]></content:encoded>
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		<slash:comments>4</slash:comments>
	
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			<media:title type="html">ffmike</media:title>
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		<title>Can You Take the Home Office Deduction? Probably Not</title>
		<link>http://gigaom.com/collaboration/home-office-deduction/</link>
		<comments>http://gigaom.com/collaboration/home-office-deduction/#comments</comments>
		<pubDate>Thu, 17 Jan 2008 13:46:21 +0000</pubDate>
		<dc:creator>Anne Zelenka</dc:creator>
				<category><![CDATA[Tips & Tricks]]></category>
		<category><![CDATA[home office]]></category>
		<category><![CDATA[home-based work]]></category>
		<category><![CDATA[taxes]]></category>
		<category><![CDATA[work at home]]></category>

		<guid isPermaLink="false">http://webworkerdaily.com/2008/01/17/home-office-deduction/</guid>
		<description><![CDATA[If you work from home, you may be wondering if you can deduct costs related to your home office &#8212; a part of your mortgage payment or rent, for example. But unfortunately the U.S. tax law in this area doesn&#8217;t recognize the work-life blend that most [...]<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=gigaom.com&amp;blog=14960843&amp;post=1647&amp;subd=gigaom2&amp;ref=&amp;feed=1" width="1" height="1" />]]></description>
			<content:encoded><![CDATA[<p>If you <a href="http://webworkerdaily.com/connect-bonus-chapter/">work from home</a>, you may be wondering if you can deduct costs related to your home office &#8212; a part of your mortgage payment or rent, for example. But unfortunately the U.S. tax law in this area doesn&#8217;t recognize the work-life blend that most home workers practice. If you mix business and personal activities in your home office, you can&#8217;t take the deduction.</p>
<p>The Wall Street Journal reports that most people eligible for this potentially lucrative deduction <a href="http://online.wsj.com/article/SB120043915626692441.html">probably don&#8217;t take it</a>:</p>
<blockquote><p>&#8220;It is questionable whether most taxpayers who are eligible to take the deduction actually do so,&#8221; IRS National Taxpayer Advocate Nina Olson said in a report to Congress last week. She urged lawmakers to offer taxpayers a simpler, optional method of calculating the home-office deduction. [subscription required]</p></blockquote>
<p><span id="more-1647"></span>Why don&#8217;t more people deduct home office expenses? The WSJ identifies a number of reasons: the law is quite complex, requires extensive record-keeping, and is perceived to raise a person&#8217;s risk of being audited.</p>
<p>What might be the ultimate barrier for many home-based web workers, however, is the <a href="http://www.irs.gov/newsroom/article/0,,id=163079,00.html">law&#8217;s requirement</a> that, in order to deduct expenses for your home office, you use that part of the home <i>exclusively</i> as your principal place of business. Very few people use their home office only for work, even if it is their main place of business.</p>
<p>This law hasn&#8217;t kept up with the reality of work today. If you set up a comfortable home office with a nice computer, filing system, and workspace, you&#8217;ll probably do your personal work there &#8212; paying bills, for example. You might play games on the computer or use it for socializing too.</p>
<p>The law could allow a proration of time based on how the office is used; for example, allowing you to deduct 80% of costs if you spend 80% of the time in your office working. While this would add to the record-keeping burden, it would have the great benefit of allowing home-based businesses the opportunity to deduct actual expenses, just like other businesses can.</p>
<p><b>Related posts</b></p>
<ul>
<li><a href="http://gigaom.com/collaboration/six-things-you-must-know-about-self-employment-taxes/">6 Things You Must Know About Self-Employment Taxes</a></li>
<li><a href="http://gigaom.com/collaboration/web-worker-101-tracking-business-expenses/">Web Worker 101: Tracking Business Expenses</a></li>
<li><a href="http://gigaom.com/collaboration/web-worker-year-end-tax-tips/">Web Worker Year End Tax Tips</a></li>
<li><a href="http://webworkerdaily.com/connect-bonus-chapter/">You Can Work From Home: A Free No-Nonsense Guide</a></li>
</ul>
<p><strong>Related research and analysis from GigaOM Pro:</strong><br />Subscriber content. <a href="http://pro.gigaom.com/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=1647+home-office-deduction&utm_content=azelenka">Sign up for a free trial</a>.</p><ul><li><a href="http://pro.gigaom.com/2011/03/why-ipad-2-will-lead-consumers-into-the-post-pc-era/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=1647+home-office-deduction&utm_content=azelenka">Why iPad 2 Will Lead Consumers Into the Post-PC&nbsp;Era</a></li><li><a href="http://pro.gigaom.com/2011/03/the-near-term-evolution-of-social-commerce/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=1647+home-office-deduction&utm_content=azelenka">The Near-Term Evolution of Social&nbsp;Commerce</a></li><li><a href="http://pro.gigaom.com/2011/02/content-farms-the-players-the-benefits-the-risks/?utm_source=collaboration&utm_medium=editorial&utm_campaign=auto3&utm_term=1647+home-office-deduction&utm_content=azelenka">Content Farms: The Players, The Benefits, The&nbsp;Risks</a></li></ul><img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=gigaom.com&amp;blog=14960843&amp;post=1647&amp;subd=gigaom2&amp;ref=&amp;feed=1" width="1" height="1" />]]></content:encoded>
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			<media:title type="html">Anne</media:title>
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