If you have a small business, do your own taxes! It’s not difficult and is a good learning experience. After all, you need to know what can be deducted, in order to make the best business decisions. Only bad thing about Small businesses, such as LLC’s, is that they have to pay 15% self-employment tax; that includes Medicare 2.9% and social security 12.4%. The SE Tax combined with Income Tax can really kill a businesses net income. But the good thing is, businesses can claim deductions and exemptions that’ll lower both SE and Income Tax. The major forms small businesses use, include Forms 4562, 8829, and 1040.

Form 4562, depreciation and amortization, is must do for all small businesses. Every business has something they can deduct on this form, whether it’s computer software or company furniture. Best of all, the deductions form this form will not only lower SE but Income tax too! On this form there is a section called election 179, which allows you to deduct the full expense for qualifying assets; you can check for qualifying assets on the 4562 publication. If your asset doesn’t qualify for a full 179 election, you can most likely claim it as a listed property. This means you have to depreciation it throughout its useful life. The amount you can depreciate each year depends on: When you put the asset into service, the amount you use it for business, type of depreciating method it uses, how many useful years it has, and how much it cost. This form can definitely save all businesses a nice amount of money every year, but be warned this is the hardest form to fill out because of measuring depreciation.

Form 8829 is to claim expenses for business use of your home. This form is definitely a red flag to the IRS: People like to abuse the system and claim the majority of their house for business. You can only claim your house for business if you use more than 50% of it for business. Unlike form 4562, this one is very straight forward. You measure your house’s square footage and compare it to what you use for business, to find a percentage. Then you take total house expenses, such as unities and insurance, and multiple it with the percentage; the result is your deduction for business use of home.

The remaining forms are all in the 1040 packet. The first one you fill out is the schedule C, which is profit and loss from business. On the schedule C, you are able to deduct more business expenses, such as advertising, and also include your deductions from Form 4562 and 8829. This form will calculate your total taxable income. The second form is the Schedule SE tax form. This form is also very simple: You take your taxable income and follow its steps to find your SE tax. The final form is for Individual Income Tax, which everybody–who works– fills out. If you have any dependents or tax credits you claim them on this form. Additionally, you can claim itemized deductions and IRA contributions. Be warned, claiming excess itemized deductions is another red flag for the IRS.

If you need any additional help, you can visit the IRS website and use their publications. They use very plain language and are very comprehensive– for the most part.

Yeah.

I do pay per click advertising with Google Adwords, which is bidding for keywords that your ad will show on Google Search. Well today I decided to do a new campaign. I set a budget of $50 dollars per day and target 5 different countries. I selected the accelerated delivery option, and let this campaign run. Yeah, when the stats updated I saw that I got 0 conversions and lost 57 dollars.

I talked to an Adword rep and he told me:

Michael C: The statistics within your account can be delayed up to 3 hours, this could account for the jump in statistics.
Michael C: The reason why you went over your daily budget is due to overdelivery.

Three keyword cost me 36 dollars: I bid for some very broad keywords. I didn’t expect it go to my budget that soon, though. Oh well.

Yeah, i suck.

So an AMEX consultant gave a presentation in my marketing class: She told us all about the different ways they promote their cards and the difference between a charge and credit card.

What are the different types of Amex cards?

Gold

Green

Platinum

Centurion “black card”, funny thing about this card is that it was made because people were asking about it. In the 1980’s people started rumors about AMEX actually having a black card. It wasn’t until 1999, that AMEX decided to make one. You can’t get this card unless you already have an AMEX platinum and spend 350,000+ a year on it. This card is by invitation only. The AMEX consultant told me that they don’t even market this card based on reason: It markets itself based on image and people having the self-conception that they must need it to become  a real baller.

 Whats the differences? The big difference in these cards is the annual fee. All the charge cards Green-Centurion have annual fee. The Centurion’s fee is 3500 per year and a 7500 initiation free. Also the spending limit on all the Charge cards can be very flexible, because they are 100% not like credit cards: With ordinary credit cards, they raise your limit every once in a while. AMEX is  willing to work with you when it comes the credit line: If you’re struggling one month and need your credit line upped, you can do it!

Whats alike in these cards? AMEX is still around because it focuses on quality treatment of customers.  AMEX representatives do their best to help out their customers and assist their needs. The one main thing these cards all have is Airline benefits. Every one of charge cards gives you special privileges when it comes to traveling. The platinum lets you stay in a special airline lounge in the airport and special hotel reservations.  The Centurion card actually has 24/7 person service. For instance, you can call AMEX and they will reserve you the best basketball tickets, plane tickets and hotels etc.  AMEX isn’t about being reasonable, it’s about quality.

So is an AMEX charge card like a debit card? No, unlike debit cards you don’t have to pay off the AMEX charge card every month. But be warned the charge cards carry a huge APR, so you might want to pay in full. Back in the day before credit cards were made AMEX made it’s charge card with it’s own system. Now, because of the complexity of the system AMEX is still using it but they changed the rules up. Now you AMEX cards are just like ordinary cards but are more flexible.
So why get an AMEX card? If you travel a lot, want quality service,  and/or need a flexible credit line, an AMEX card is right for you: They have excellent service, coupled with many travel rewards/benefits and are very flexible with allotting credit for their customers.

Yeah, all this AMEX loving coming from a VISA+Mastercard holder But I really wish I could get an AMEX Charge card without paying the annual fee’s

I have a dilemma…I recently invested a considerable amount into Chipotle (CMG) and am second guessing myself already. Maybe I’m a little shortsighted in this situation, but I’ll go on.

So, my basis for investing in Chipotle was based on my investment in McDonald’s (MCD) earlier this month. I got in at around $50 and got out at $56 a little over a week later. McDonald’s was down from $63 in early December and was definitely oversold.

It was below it’s bottom Bollinger Band and its OBV, RSI, and stochastics all suggested it was significantly oversold. McDonald’s had dropped so much because they reported slightly lower than expected earning for Q4 of ‘07 and of course, the market overreacted. McDonald’s blamed it on the weather, then predictions came out saying McDonald’s expected higher earnings for Q1 and big growth overseas. By the way, stocks like McDonald’s and Wal-Mart are good stocks to hold this year during the recession, that’s right, I said it.

Now, Chipotle is in a similar situation. It’s down from $160 in early December to about $100. Chipotle also reported low earnings, but doesn’t have support overseas, and hits more upper-income demographics than McDonald’s (not as good during a recession, but I’m calling short-term).

Like McDonald’s, it was recently below it’s lower Bollinger Band and both the RSI and Stochastics suggest it is severely oversold. However, the OBV is so low, suggesting they is no buying interest…not a good sign. Also, the stock did not retrace back to its moving average like it had been previously, obviously causing me some stress…

Conclusion? I’m panicking and I trust my analysis, and will continue to hold :). Expect an update later this week.