Successful Telecommuting

Posted by Offer Tsuriel on September 18, 2009

Many two-income couples have an annual discussion about the possibility of one spouse working at home-at tax time. One of them will throw out the idea that it would be more economical to lose one income and pay less in taxes. Then these couples laugh hysterically and go back to filling out their I040S. Every year at tax season, financial experts urge Americans to use the annual bloodletting as a time to

take stock of household spending, withholding, and income. And every year, across this great country of ours, we taxpayers, relieved at having met the deadline, respond by saying, “Pass the tequila!”

 

So, I encourage you to take a few minutes now-while the Infernal Revenue Service isn’t breathing down your neck-to consider the advantages and drawbacks of having one spouse work at home.

A lot of misinformation on this topic regularly gets spread through the national mcdia Iike fertilizer, resulting in sprouting hopes and an ever-growing number of Americans who believe that working at home will produce a bountiful harvest of financial rewards. Not the least of which is digging themselves out of the hole caused hy taxes. The Tax Foundation reported recently that a typical, two-earner family in I998 lost nearly forty percent of its income to federal, state, and local taxes, more than the family spent on food, clothing, and shelter combined. Take away one of those incomes, and the tax burden diminishes greatly. Artful dodgers can even find ways to lose money on their home husinesses every year, which can reduce the amount the salaried spouse pays to the feds.

But, you say, the family has jettisoned an entire income. How can even a substantial reduction in taxes make up for that loss? Heh-heh, I reply nervously, you’ve got me there. Beats the heck out of me. I’m no financial expert. My wife takes care of the money at our house. 1 can’t even remember my ATM number. However, financial experts such as my wife would bear me out when I say other, not-so-visible savings occur when one spouse opts to work at home. Let’s look at some of them.

COMMUTING

If the work-at-home spouse no longer drives across town to a job, then less is spent on gasoline and maintenance. Even reduced wear and tear on the vehicle can be factored into the formula, though this requires knowledge of calculus. At-home workers soon realize, however, that we end up driving just as much, chauffeuring kids to school and to after-school events. Not to mention driving to the supermarket, the hardware store, the dry cleaners, the doctor’s office, the dentist’s office, the mental health clinic, etc….

Okay, maybe those savings aren’t so great. Let’s try something else.

FOOD

Lunches out are costiy, and entertaining clients can he even pricier, especially if nne of them is a guy named Buck who expects to procure his weekly alcohol consumption with your credit card. By working at home, you can prepare light, nutritious meals for mere pennies a day. Of course, it rarely works out that way. With no formal lunch hour, you graze all day long, resulting in overall higher grocery bills as well as the cost of larger sweatpants. In fact, you can spend as much on your daily allotment of Chee-tos as you did previous I y on fancy lunches. And eating alone can be a drag. Before long, you may find yourself inviting Buck over for a beer.

SUPPLIES AND FURNISHINGS

Everything you buy for your home office-down to thc last paper clip-is tax-deductible. And that provides opportunities for the creative worker. If you ean prove your business required you to invest in many expensive gadgets for your home office or to visit, say, Tahiti, then you stand to reap a financial boon come tax refund season. The problem with this strategy is that you must actually spend the money first. You can gallivant around, throwing your money away, but only a small portion will later be saved in taxes. And the folks at MasterCard will still want their money.

CLOTHING

Aha! Now here’s one that certainly should be recorded in the category of “Money [ don’t have to spend anymore.” Employers expect their workers to meet a certain dress code. If the job you’re leaving is the typewhere you’re expected to wear a suit every day, you certainly should save money by working athome. T-shirts llfe cheap. You may find, however, that you destroy more clothes at home than you ever did at thc office. Little tasks you do around the house-chores you would’ve paid someone to do when you had a full-time job-have a way of eating clothing. A weedwhacker, for instance, can reduce your favorite jeans to confetti in no time. And medical bills may result as well.

So there you have it. A pragmatic look at the numbers provides proof positive that most couples can benefit financially by having one spouse work at home. At least until the auditors catch up to you.

GETTING STARTED

Okay, let’s say you’ve examined your financial status and your mental preparedness and you still delude yourself that working at home is a great idea. Subtract from the equation any extraneous considerations, such as the proximity of the refrigerator to your desk at home. Still want to try it? Sure I can’t talk you out of it?

Damn.

Well, then, it’s only fair that you be properly prepared. The first step toward a successful home business is setting up an efficient office. Needs vary, depending on the type of business and personal preferences, but some general rulcs apply. For instance, you will need more space than you think. And you may want doors that lock, particularly if there arc children in the house.

Even smallish homes have underused areas that can be converted into office space. Breakfast nooks, closets, attics, garages, even a corner of the bedroom can be reconfigured for business use. Remember, however, that your family may not adjust well to the change. If you section off a piece of a family room for your office, your kids may still think that’s where they belong when they’re watching cartoons. Adding a wing or a second story can give you plenty of room. But do you really want to invest in such expensive remodeling before you know whether your home business will be a success? I didn’t think so.

Once you’ve determined where to put your office, you’ll need basic furnishings. A solid desk and a comfortable chair are the bare minimum. And you’ll need a computer, naturally. Hardly any business operates without one these days, and computers offer endless opportunities for distraction and procrastination. You’ll need file cabinets, though milk crates can do the job if you’re operating on a shoestring. A work table is nice, too. I recommend an old door suspended over the file cabinets. That way, you won’t feel much of a loss when it collapses under the weight of unfinished paperwork. Lighting should be appropriate for the workspace. Bright enough to see what you’re doing, but dim enough so that you don’t notice the dust that has settled over everything. A sofa makes a pleasant addition to the workspace, especially onee you become accustomed to regular siestas.

After properly furnishing your office, you’ll be broke. That should servc as a good impetus for working your ass off and making your home busincss a success.

One final note: get separate phone lines for your business phone and computer. You don’t want to keep an important client waiting while your kids are calling the neighbors to ask whether their refrigerators are running.