Several different things must happen for a home business to be successful. Just think about it. A home business is very similar to a traditional brick and mortar business. For one, both businesses must be organized. Further, both a home business and a traditional business require that you understand your target market, and not surprisingly, offer a useful product or service for the market targeted. If you are looking for some tips on how to operate a successful home business, you should consider the following.First and foremost, I need you to be aware of the fact that the Internet is full of enticing advertisements making promises of quick online money. The problem is that these claims are false, and you will not become rich overnight with your home business. Just like a traditional business, home business requires a plan, and consistent action. The sad thing is that so many people fall victim to the predators who claim that if they hand over their money, they will have the opportunity to make fast and easy money. This could not be further from the truth.Many people are unable to succeed in home based business, simply because they have not developed the prerequisite skills to become successful with their business. This failure to develop the required skills does not come as a result of a lack of desire. The truth is that many people strongly desire to possess the skills which will make them successful in business. The problem is that these same people are unwilling to take the necessary steps to learn and develop these skills. Therefore, if you are serious about owning a home business which can take you to new heights of income, it is important that you educate yourself.In addition to acquiring the requisite skills, you also must gain knowledge in order to be successful with home business. You have to know who is going to be interested in what you are offering. In other words, you must clearly identify your niche market. If you do not do this, then you will be completely ignorant of why you are offering your products and services to those who you are marketing towards. Furthermore, knowledge tells you what sort of marketing your targeted market will respond most positively to. Knowing this will not only increase your conversion rate, but also minimize your marketing expenses.One thing which I must caution you about, is remaining realistic when setting your expectations. Do not expect to earn $5000 per day overnight. Just like any business, your home business must be built over time. You must look towards the future to remain grounded in the present. Set short-term goals which will be the stepping stones to achieving your long-term goals. As discussed above, do not expect overnight success, as this is an unrealistic short-term goal. Instead, you need to set the expectation that you will work diligently to build your home business over time. Many have become Internet millionaires following this approach.For the time being, it is important that you set some short-term goals. For instance, where do you want your home business to be in the next 3 months, 6 months, and 12 months? Remember to set realistic expectations, and constantly envision yourself as you will be standing once these goals have been achieved. The fact of the matter is that it can take a brick and mortar business up to 1-2 years to become profitable, if at all. However, many home businesses are able to achieve profitability more quickly due to less fixed expenses.One of the most import skills which you must acquire in order to achieve home based business success, is to research and know your competition. Do not hesitate to get out there in and talk to others in your niche to see what they are doing. You do not even have to let them know that you are the competition. If you do this, you can learn what is being done successfully, as well as things to avoid.You should never forget that your success in home business is directly tied to your ability to embody the skills which will enable you to achieve your long-term goals. It is important that you are able to learn of your niche market from the very beginning, envision success, plan long-term, analyze the competition, and work consistently over time towards achieving your goals.

Are you taking advantage of your US home based business tax deductions?The timing could not be better for working from home. In our current economic climate, having a home based business is not only a great way to earn additional income, it has great tax benefits in the US. Aside from mortgage interest deduction on your primary residence, operating a home based business can save you hundreds, even thousands of dollars on your Federal tax bill. This is the time of year where we not only set our goals, but start preparing to file our taxes. Here are 5 tips to consider to optimize your federal return:1. Get organized and automate your record keeping.Like it or not, one of the necessary parts of being a business owner is dealing with expenses, in other words accounting, a task that many of us dread. It is crucial that you maintain good records since your documents (bills/receipts) are your proof of your deductions. Keeping good records doesn’t have to be hard or expensive. Most of us starting out can’t afford to hire an accountant, but all you really need is a file to store your receipts. We’ve used the accordion ones to categorize our expenses to make it simpler at tax time. If you can afford it, we recommend a business type of software like Quickbooks or MS Money (and yes the cost of the software is deductible) and enter your bills and banking info as you go; this will save you hours and hours of time when doing your taxes and in many cases, the data can be imported to a tax program with a click of the mouse.2. Set up a designated area in your home as your office.Did you know that if you qualify, you can deduct a percentage of your home by having an area as an office? If you can, a spare room is ideal, but you can even designate a space in your home (like a desk cubicle) and deduct a portion of your mortgage/rent and associated home utilities if your space is used exclusively for business. For example, a spare room could be equal to 15% of the total space of your home. If used 100% for business, you could deduct 15% of your utilities, home owners insurance, property taxes, rent/mortgage etc on your return. Detailed information on a home office deduction can be found in IRS Pub 587.3.Deductions for office equipment and furniture.Did you buy a new laptop or printer for your business in 2010? What about that desk or file cabinet? This year, the 179 Deduction limit is up to $500,000.00 for qualified expenses. You can write off the entire cost of these items if used 100% for business.4. Deductions for the cost of doing business.Did you buy office supplies? Postage? Business cards? What about advertising costs, web hosting fees, professional fees, software, education expenses (if directly related to your business)? These are some examples of expenses that you can include in your home business deductions. See IRS Pub 535 for additional information.5. Travel, meal and entertainment expenses.In 2010, we took two trips for business events. We will be able to deduct our air fare, hotel, meals, and fees associated with these trips, which will save us hundreds of dollars on our tax bill! Do you use your vehicle for business? If so, did you know you can deduct 50 cents per business mile? This is a DECREASE from 2009′s 55 cents per mile. IRS Pub 463 has additional details on this specific expense category.When you add up all the possible deductions, you will be surprised (and we guess glad) to see how much you can save on your tax bill. We know tax preparation can be a daunting experience for many, and most of us can’t afford to hire a tax accountant. That’s where tax preparation software saves the day. There are several titles available, simply do a search on “US tax software” and you’ll get several to choose from. We personally have used Turbo Tax (yes, the software cost is deductible) for several years and it makes figuring out your business taxes a breeze. It saves hours of time pouring over the IRS publications and helps you find deductions you may not have otherwise thought you had available.The good news this year? Taxes aren’t due until April 18th, 3 extra days! Don’t let the task of filing your taxes be one you hate; with your home based business, you may find tax time a pleasant experience, especially when you see how much you save!