Small businesses, many economists believe are the driving force of the US economy. From the business owner with no employees, to the companies that have 500 hundred, it is certain the United States economy benefits from the entrepreneurship of the 27 millions of Americans that start a business, or are running one.
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Small businesses have to go through too many regulatory obstacles to fund themselves.
While it’s new firms that tend to drive job creation, small businesses overall play an important role in the economy. In 2013, roughly half of all jobs and wages earned were through small businesses. And as Goldman Sachs’ Head of Global Investment ResearchSteve Strongin pointed out earlier this year, as of 2013 there may be more than 600,000 fewer small businesses than if we’d not had the 2007-2009 crisis. Since politicians often blame others for economic woes or claim responsibility for economic successes, it’s no surprise that small businesses serve as a talking point this election season.
For instance, Democratic presidential candidate Hillary Clinton pledged to “break down barriers so that starting a business can be as easy as setting up a lemonade stand in the front yard,” though regulations even seem to be getting in the way of that these days. Nevertheless, the objective of making it easier for small businesses to fund themselves has broad appeal with Americans of all political stripes. Figuring out how businesses fund themselves and what obstacles they face is the first step toward thinking about effective solutions to address the constraints on access to capital for small businesses.
How to maximize your tax deduction for business use of a car
Anyone who uses a car for business should know the costs associated with the miles you drive for your business are tax-deductible. Most years, when the IRS publishes its deductible cost-per-mile rates, the figure rises as the cost of owning and operating a motor vehicle rises.
But not for 2016. For this tax year, the IRS has dropped the standard mileage rateto 54 cents per mile from 57.5 cents in 2015, thanks to sustained low gas prices.
However, you may find that your actual operating costs are higher than the deduction the IRS allows in its standard mileage rate.
So why do so many taxpayers use the standard mileage rate to figure their deduction for business use of a vehicle? Well, for starters, most people think it’s easier, requires less documentation and has less chance of an IRS audit. But none of that is true.
You might think the standard rate overcomes a lack of keeping detailed expense records. But it doesn’t. In fact, most people who use a car for business purposes probably have most of the expense records they need to use the actual-expense method.
Your Small Business Should Have a Board of Directors
You may have the best small business ideas in the world, but succeeding in business requires you to understand the business of running a business. Operating a business of any size is not like mixing together the right ingredients for a casserole and then letting it cook in the oven. It’s a continual, evolving process, and you have to develop and tweak your processes and systems to make it work. One of the best ways to learn to run your business better is to pull together a board of advisors.
It’s important to be honest with yourself about what you don’t know. Once you identify learning gaps, it’s best to pull together five or so people who know more about business than you. When you start thinking about who might be the best suited for your advisory board. Start with an existing entrepreneur, an existing or potential customer, a mentor who may not be in your industry, a lawyer and an accountant to recruit to your board.
You can always realize a strong return on investment by allowing specialists to advise you in areas in which you are not trained. As the business owner, you always need to be focused on your most valuable tasks. In addition to specific skills and processes, your business can benefit from small business advice on a broader, more holistic level. Using a board of advisors is invaluable guidance for your business.
