|No matter how long you have been at a company, or where you are in your career, losing your job is always a possibility with full-time employment. Have you established a Plan B source of income? Have you thought about what you would do if you lost your job in today's volatile and uncertain economy? Personally, I believe everyone should have at least one part time, self-owned business. Just the tax benefits alone can be worth having your own part time business. Schedule C, from the IRS, allows you to write off a lot of various expenses from a sole proprietor business that you would never be able to claim if your only source of income is from a W-2 job as an employee. Almost everything can be applied to your businesses; write off meals, travel expenses, phone, internet, utilities, stationary, uniforms, business wear, and work clothes. This significantly reduces the taxes that you owe each year. Are you able to claim all of those things with your current W-2 job?|
|Whether it's because of industry changes, market or general economic downturns, or a disagreement with your boss, the impact of losing a job can be devastating. How can you protect yourself financially? One way is to diversify your sources of income. A diversified income has more than one source, similar to a diversified investment portfolio. The same idea of spreading your exposure can also apply to the ways you earn money, even while holding down a full-time job. Whether you are early in your career, are thinking about leaving a full-time job to start your own business, or nearing retirement, there are plenty of ways to diversify your income. It also helps that income sources are in different markets (for example: real estate, food, healthcare, etc.) so that, if one market of income dries up, another market will flourish. Research more on this topic.|
When we were young, neighbors may have paid us cash to cut the grass, babysit or do odd jobs around the house. Chances are that those funds were not reported to the government and taxes were not paid. As we get older and, hopefully, wiser and more responsible, this is not a wise thing to do; mostly because it's illegal, but also that it can affect your retirement funding and general peace of mind. Most people see only the "immediate gratification" of getting money in hand but rarely look at things long term or, even, the potential negative consequences. Working "under the table" generally implies that you are being paid out of pocket; not documented by the employer. It can be illegal and devastating for the employer and the employee. For the 'employee', payment of back taxes could come due and qualifying for government benefits may be out of reach as well as saving for retirement and other advantages available to 'legal' workers. For employers, if an official W-9 and 10-99 is not submitted to the IRS on behalf of the 'worker', a loss of licensing, fines and also back taxes could come due. Bottom Line: DON'T DO IT, as a worker or as an employer. This habit will, eventually, come back to bite you; most likely at the most inappropriate time and in ways you may not have considered. Read more at Getting Paid Under the Table.
[Topic Search Results]
Now, for the sake of arguement, when a sudden job loss occurs, eating and paying bills tend to overshadow paying taxes. Nevertheless, keep Mark 12:17 in mind; Give to Caesar (government) what is Caesar's and to God what is God's.