(Disclaimer: The following article is general suggestions for ways to write off your products for your Mary Kay Business. Tax laws vary by state, and I am not an accountant, so please check with a CPA for any specific tax questions).
Now that the legal stuff it out of the way, let’s start writing off some products!
1. Personal Use Products
One of the great benefits of running your personal Mary Kay Business is that you get a huge discount on any products you purchase for your personal use. So, how do you make sure your not paying extra taxes on items you are not selling? Simple, create an invoice (for yourself) with a 50% discount. There is an important point to watch out for though, and that is UNRECOVERED SALES TAX. This is the tax you pre-paid when you purchased your product from Mary Kay, but did not collect from you customers. You can find this number by taking the amount you discounted and multiplying it by your sales tax in your area. This formula will be used for any tax write-off invoice you make, or any discount you make for your customers. This is easy to do when you have a running total of your personal use (or demo) products, because you can just do one math calculation at the end of the year instead of doing the math every time.
2. Expired Products
Do you have products that are about to expire but don’t want to just throw them away? Donate them to charity before they expire. Put stickers on all your products with your contact info and an offer. “Want to love what you do? Give me a call!” You can write off your purchase amount for the amount you paid for the product in the first place, and it’s MUCH better to get advertisements out of your products that are about to expire than just throwing them away.
3. Demo Products
Demo products are the most common items that are missed when figuring out tax write-offs for your Mary Kay Business. This is most likely due to the fact that the product is still “on” your shelf… but the truth is, that item cannot be sold, so why not get your tax write-off for it? It is a cost of doing business after all!
In this short video below, you can see how easy it is to create a tax write-off invoices for your Mary Kay Business using QT Office. The best part is that when you create that invoice the product is deducted from your shelf, the math for the invoice is calculated automatically and your totals are recorded so tax time is a snap.
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This entry was posted in QT Office® on March 31, 2011