Financial Education

On Tuesday, March 29, 2011, the Internal Revenue Service is presenting a FREE webinar for tax professionals, small businesses, self-employed persons and independent contractors: Business Taxes for the Self-Employed: The Basics.

The webinar will cover:

• Reporting profit or loss from a business or profession

• Self-employment tax and estimated tax payments

• Schedule C and C-EZ

• Deducting business expenses

• Husband and wife businesses

• Recordkeeping

The webinar starts at 2 p.m. Eastern, 1 p.m. Central, noon Mountain and 11 a.m. Pacific.

There are three basic reports important to your business.

• Income or Profit and Loss Statement
• Cash Flow Statement
• Balance Sheet

An income or Profit and Loss Statement shows where and how money goes in and out of a company for a period of time.  Monthly, quarterly and annual Profit and Loss Statements show the financial strength of a company,

The Cash Flow Statement is one of the most useful financial management tools because it shows you exactly how cash is flowing in and out of a business. 

The Cash Flow Statement is a guide for business making business decisions such as adding employees or planning major purchases.

Fair Isaac & Co, or FICO, is a generic term for a credit bureau score and refers specifically to model used by FICO.  There are other statistical models, however, FICO is the most widely known.

Credit scoring has become widely accepted by lenders as a reliable means of credit evaluation.  The credit score condenses borrowers credit history into a single number.  FICO and the credit bureaus don’t reveal the exact methodology for computing the numbers. 

FICO scores vary from 375-900 points.  The higher, the better.  To get the best interest rates, you generally need to score 680 or higher.  Someone with higher than 680 is considered to have “A” credit.  If you score below 620, you will generally pay a higher interest rate on your mortgage and your credit is considered “sub-prime.” If your score is between 620 and 680, the lender may decide which category you belong based on factors such as income, assets, payment history, etc. 

Maximizing the Web’s convenience, accuracy and speed, IRS.gov -IRS’s web site- now assists millions of individual taxpayers, tax professionals, and small business owners to better understand and meet their tax responsibilities.

Updated Virtual Small Business Tax Workshop

The IRS’s Virtual Small Business Tax Workshop is an interactive resource to help small business owners learn about their federal tax rights and responsibilities. This dynamic educational product, available online and on CD 24/7 from your computer, consists of nine stand-alone lessons that can be selected and viewed in any sequence. A bookmark feature makes it possible to leave and return to a specific point within the lesson. Users also have access to a list of useful online references that enhance the learning experience by allowing them to view references and the video lessons simultaneously.