The place you need to start with your home business is with pen and paper or word processing software and a PC. One thing I learned about starting businesses is there are so many variables involved it is not possible to “keep it simple” if you try to run entire business without some type of plan. Not knowing or not being able to prioritize your needs with your business can result in bad money management and eventually failure.

Writing down what your business is about helps put your business into perspective and helps you define your immediate needs and hold off on spending on items you don’t need right away. Most recommend you write a business plan. You can buy software to write a plan and go through a set of questions to write one. You could always research how to write a business plan online.

Whether you use software or not to write a business plan you could always ask yourself basic questions. Getting to basics means a lot to me. It provides a foundation to your ever evolving business plan.

If you are starting your own home business, try asking yourself these questions. They may help you in same manner as they help me:

1. What is your business name?

2. Is your business registered as a “Doing Business As” (DBA) or Corporation? – This is very important for tax purposes and banking.

2. Explain what you business does in one short paragraph. – Describing your business in a few sentences helps define main focus of your business.

Don’t Panic

Each year, IRS sends out millions of “correspondence audits” to taxpayers to request payment of taxes, notify them of a change to their account or request additional information. These audits normally cover a very specific issue, often notifying you of additional small amounts of income for which you owe tax. Each letter and notice provides specific instructions explaining what you should do if action is necessary to satisfy inquiry.

Most correspondence can be handled without calling or visiting IRS. You simply follow instructions in letter and matter is put to rest. Alternatively, you can contact IRS to contest matter. Simply call telephone number indicated on letter or write an explanation as to why you disagree. Make sure to include copies of any supporting documentation you want considered by IRS. Typically, it will take IRS between one and two months to respond. During first quarter of year, it can take two to three months.