1. Going green: Did you take steps to make your office greener in the last year? If so, you may be able to write off the expense of doing so as a deduction. Depending on your industry, there are even some tax credits available.
2. Payment processing fees: Using online payment processors, like PayPal, is becoming more common among small businesses, but there’s a price tag that goes along with doing so. The fees charged on each of your transactions are deductible.
3. Travel to and from the airport: The fact that you can write off business travel on your taxes is common knowledge, but did you know that you can even write off the taxi trip to and from the airport, as long as you’re traveling for business purposes?
4. Tax preparation: Considering the expense of getting a tax return prepared when you own a business, it’s a good thing that you can deduct your tax preparer’s fees. The same holds true if you have any help throughout the year with tax planning or other tax-related tasks.
5. Blog posts: If you hire a writer to put together posts for your business’ blog, it’s a marketing expense and can be written off. The same holds true for other social media help.
6. Hidden bank and credit card fees: If you have a bank account or credit card in your business’ name, go over the statements very carefully. Even if you can’t get hidden fees removed, they are still business expenses and can be written off on your taxes.
7. Unpaid invoices: As long as you’re using the accrual method of accounting, rather than cash, your unpaid invoices can be written off on your taxes. However, this deduction can be tricky, making it particularly important that you talk to your accountant before claiming it.
8. Employee benefits: Of course you can write off any benefits that you provide for your employees, but that term can cover a lot of ground. If you buy an employee a monthly bus pass as one of their benefits, that’s just as deductible as health insurance.
9. Holiday parties: Do you have a get-together for your employees during the holidays? The expenses for that shindig can be written off, as can holiday cards to your clients.
10. New employees: The expense of hiring a new employee, from putting out a job listing to printing up new business cards, is entirely tax deductible. Even paying for a prospective employee’s travel for an interview is deductible.

It’s important to note that every business’ tax situation is different and it’s impossible to address every situation in a blog post. In order to make sure that your taxes are in order, it’s crucial to talk to a tax professional who can walk you through determining your eligibility for these tax deductions.

Image by Flickr user AlanCleaver_2000

We have got you covered this year by covering this upcoming South by Southwest 2010 (SXSW) in Austin, TX. Personally, will be my fifth time attending this must-go conference for the digital techset. Originally, SXSW began and still is a music festival (that starts on Mar 17) and a little over 10 years ago the interactive portion started. The interactive portion (Mar 12-16) has evolved into the can’t miss conference of the year.

We will be covering the event from the road and bringing back video interviews with thought leaders, entrepreneurs and other cool stuff we think you will like.

Some of the things you can look forward to:

- Interviews with Entrepreneurs – Last year we met great entrepreneurs and thought leaders like Dave Delaney,Jonathan Fields and Alex Hillman. This year we will be

- Coverage of the Small Business Brunch – This year is the first anniversary of the Small Business Web and its launch at SXSW at a brunch at the amazing Moonshine Cafe.

- Exploring the SXSW parties to find cool people – Like we need a reason to go to a party to suffer for our art. The SXSW parties are great and the best ones are the impromptu one’s that are more intimate and have the best conversations. We will bring back some great videos so you can share in the fun.

Lastly, if you are going, I would recommend taking a read of these two posts on how to plan for and survive what is an amazing, fun, informative and exhausting conference:

Ken Yeung’s Survival Tips for SXSW

Technosailor’s Crash Course on Surviving SXSW

Next Tuesday, March 16 in New York City, Ramon Ray of SmallBizTechnology.com and many other talented people are putting on the annual small business technology summit at Digital Sandbox in downtown Manhattan.

The event is being keynoted by famous author and marketing guru, Seth Godin. Other speakers include Shashi Bellamkonda of Network Solutions, Angus Thomson of Intuit, Grant Wickes of Wasp Barcode, Mel Parker of Dell Small Business, many others and your’s truly giving an updated version of my rules for killer business cards (2010 edition).

It is an all day event that covers the most relevant and high impact topics and issues that small businesses are dealing with today.

To see the entire list of speakers and agenda, head to http://www.smallbiztechsummit.com/index.php

We Are Giving Away 10 Tickets for FREE Admission to the Event!

Since Shashi and I are both speakers at this event, we have been given 10 tickets to give away to small business owners that can make it to the event.

How to enter the contest:

To be eligible, we need you to do the following:

1. Go to our Facebook Page: http://www.facebook.com/pages/Network-Solutions/190173166019
2. If you are not a fan, become one. You must be a fan to win.
3. Talk about your small business and one issue you are facing as a small business owner.
4. Mention your business name and include a link to your business.
5. Mention the Small Business Tech Summit.

THAT’S IT!

We will award the tickets to the first 10 small business owners that put something on the wall with those details above. Good luck!

If you win or not, here are the details on the event:

Date
Tuesday, March 16, 2010

Time
8:00 am – 5:00 pm

Location
Digital Sandbox
New York Information Technology Center
55 Broad Street
New York, NY 10004

Web Site: http://www.smallbiztechsummit.com/index.php

Don’t Let the Man Get You Down

According to the SBSI report, even though compliance is not a problem area, 54 percent of owners feel that government regulation is becoming more burdensome. This sentiment has also grown in the past year, raising the question of why small businesses have these concerns. One possible explanation for the perception of increasing burdens may be the economy and how it affects the behavior of governments. Local, state and federal agencies may be becoming more stringent in the enforcement of fines and seeking new ways to tax small businesses in an effort to make up for their own revenue shortfall. One example is real estate assessments, an area where local governments are often accused of exaggerating values when they need to raise revenue.

Protect and Serve….Your Data

The other side of compliance is keeping customer information secure. This does tie into regulations that might apply to some data (HIPPA, Sarbanes-Oxley) but overall companies are up on the technology and have implemented systems to secure and protect data. Where they feel the pressure is the aforementioned burden of government regulation. Currently, small businesses feel they can comply but are concerned that any more regulation might cause them to incur infrastructure and personnel expenses that they are not able to support putting them out of business.

Download the SBSI Report Right Now

If you are reading this on the web site, GrowSmartBusiness.com, you should see a link to the report or if you don’t or a looking at this in a feed reader, you can get the report at http://growsmartbusiness.com/wp-content/files/SBSI_February_2010.pdf.

Getting the Right Creative

Buying creative services isn’t really the same as most purchases you might make for your business. You can’t exactly run down to the local office supply store and pick up a logo the way you might grab a box of envelopes.

You’ll likely be able to find someone whose portfolio matches what you have in mind for your project by looking at who other people in your network rely on or by looking online. But finding that graphic designer or copy writer is just the beginning. You’ve got to check availability, pricing and a host of other questions to make sure the fit is good. The creative professional in question also needs to be comfortable.

Todd Adkins is the creative director behind Born to Design, a firm that has created brands and designs for a wide variety of clients for over 13 years. He points out that while most creative professionals have the opportunity to pick and choose projects, not that many actually do — meaning that if you can sort through the details, the designers or writer will probably be on board. “My experience has always been that it’s hard (and sometimes dangerous) to say ‘no’ to a project. So many really good projects have been borne out of a recommendation from someone who gave me a project that really wasn’t my cup of tea. Specializing is a good idea, but I find the variety keeps me, and hopefully the work, fresh.”

Common Misunderstandings

Adkins has seen numerous projects, including a few misunderstandings between clients and creative professionals. When it comes to the key problem, though, Adkins says “…The only one that comes to mind is that you can’t always drop everything and tend to a specific client’s needs right then and there. They may be used to a devoted staff for their needs, but I may already be putting out a fire for another client that really has to be wrapped up before diving in elsewhere. Patience is a good thing to have on both sides.”

If you’re used to handling most projects in-house, working with an outside creative professional can be a big adjustment.

Staying On the Same Page

The key to just about every issue that can arise between you and a creative professional is communication. Ask every question you need an answer to and bring up any concerns that you might have. If you can talk through each step (including your assumptions), you can wind up with not only a great project but a relationship that will allow you to continue to work with a creative professional for the long-term.

Photo by Flickr uUser PedroSimoes7

Innovation is Not Just About Creating a Cooler Widget. It is about Business Innovation Overall.

When many people hear the word innovation they immediately think of products like the iPhone that change the landscape and innovate an industry. While not every business can create a product like the iPhone, they can innovate. Slightly less than half of small businesses are successful in innovation. This is around the areas business process innovation, which includes coming up with new ideas before competitors and finding ideas to increase revenue.

The most recent SBSI wave examined marketing and innovation in greater detail, including the methods used by small businesses to attract new customers. When asked about six common categories used to obtain new business, the most common method – relied on by over a third of small businesses – is traditional print advertising such as newspapers, trade journals, and magazines. After this, email marketing is the second most common method used by a quarter of small businesses, and social media marketing which is used by a fifth. Half of small businesses do not use any of the six standard categories for marketing leads, but the majority of these “other” channels consists of reliance on referrals and word of mouth; this includes direct referrals, leads that come to the business because of its general reputation, or referrals by other businesses. Besides referrals, “other” types of marketing methods tend to be idiosyncratic methods related to the business such as:

• Walk- in traffic
• Outdoor advertising such as signs and vehicles
• Farm markets, craft shows, etc.
• Conferences, trade shows, and meetings (e.g., the Chamber of Commerce)
• Agricultural commodities markets
• Directories (print and online)
• Personal selling and cold calling
• The GSA Schedule for federal government business
• Volunteering in the community

The Economy has Been an Innovation Catalyst

An interesting thing I saw in the SBSI is that the economy has a silver lining in a dark cloud. The recession has had some positive effects on small business innovation, including leading them to:

• Find more efficient ways to operate (72 percent)
• Find new products and services to meet customer needs (47 percent)
• Become a better team (43 percent)
• Reduce inefficient or unnecessary staff (31 percent)

The Economy: A silver lining in a dark cloud. The recession has had some positive effects onsmall businesses, including leading them to:· Find more efficient ways to operate (72 percent)· Find new products and services to meet customer needs (47 percent)· Become a better team (43 percent)· Reduce inefficient or unnecessary staff (31 percent)

The Bottom Line: Innovate or Perish

So you now know that innovation is not just for making newer cooler electronics or widget. It is about innovating with your processes, learning about how to go against your competitors and use tools like social media to stand out. To survive you must innovate or perish. That’s it. So what are you waiting for?

Download the SBSI Report Right Now

If you are reading this on the web site, GrowSmartBusiness.com, you should see a link to the report or if you don’t or a looking at this in a feed reader, you can get the report at http://growsmartbusiness.com/wp-content/files/SBSI_February_2010.pdf

From celebster on Flickr

But now my business is nearly a year old, and I have yet to shop for a bank. Since the Grow Smart Business theme is small business finance during March, I decided to use my bank shopping experience as blog post fodder.   I will be looking at a small community bank, a regional bank, and a huge national bank to figure out who would be most convenient, easiest, and most fun to do business with.

First up: the small community bank.     

Access National Bank is the definition of a small community bank.  It has 5 branches in northern Virginia, and the main branch is conveniently located across the street from my neighborhood.  During its ten years of business, it has been a standout in the local banking industry: it was profitable within 6 months (one year is the norm), and in fact its first two quarters were the only non-profitable ones on record.  CEO Mike Clarke did not establish the bank with the goal of growing it and selling it.  He has kept the bank focused on its core competencies and shied away from subprime mortgages and the residential and commercial real estate markets, the latter of which is now also imploding.  During the first quarter of 2009, one of the worst on record for local banks, Access National posted a $2.9 million profit.  Obviously, this is a solid bank with two feet firmly planted on the ground.  Awesome, and reassuring.

I recently had a meeting with Diane Holland, Assistant Vice President of Client Services, and Cynthia Caldwell, Senior Vice President of Client Services.  It took all of five minutes to walk over—how often can you do that in the suburbs?—a fact that already gave them a leg up on the competition.  I asked them to run down the list of what makes them unique.  Here’s what they said: 

1. Access National focuses on the business sector.  Their clients are small to mid-sized businesses with up to $100 million in annual revenue.
2. Each month, clients receive a $20 rebate for ATM fees to make up for the fact that they do not have ATM machines on every corner.
3. A pioneer in online banking (they embraced it up on their founding in 1999), Access National still stands out for offering real-time online banking.  Transactions are posted immediately, not 24 hours later.
4. There are no 800 numbers at Access National.  If you need to reach someone, you have a phone number for a real person, and your needs are usually handled by that same person.  Cynthia said she has almost no turnover in her client services division.  Amazing!
5. Access National offers networking events for their clients, and because they actually know all of their clients, they also act as a source of referrals.
6. Access National is the #1 commercial bank by lending volume in the entire Washington metropolitan area.  They are also a preferred partner for SBA loans.
7. Though they are small, Access National offers all of the products and services that large banks offer: investing, life and health insurance, payroll, etc. 

By the time I walked home, I was impressed.  First of all, how often does the Senior VP of Client Services meet with a potential client?  It was obvious to me that if I chose them as my bank, I would receive highly personal service, and I cannot stress enough that being able to walk over to the bank is the ultimate in convenience.  However, the fact that they foster a sense of community through their networking events is the real kicker.  I have never heard of a bank that does so.

Next up: the regional bank.

Make no mistake, one way or the other, tax on hourly wages must get paid. Either the company deducts them from a paycheck and makes monthly 941 payroll tax payments or the individual needs to make self employment tax payments. The IRS has determined there are three criteria for consideration when deciding whether an individual is an employee or independent contractor.

1. Behavioral – Does the individual decide where to be, when to be there and what to do when performing their duties?
2. Financial – Is the individual completely responsible for tracking their finances, negotiating their rate, paying for their own expenses?
3. Type of Relationship – Does the individual conduct all aspects of their part of the business relationship with regards to contracts, starting, leaving, paying taxes?

If the answers to all of the above is Yes, without any reservations, the individual may be considered an independent contractor. But any shades of gray will pull toward requiring the company to pay the payroll taxes. One rule of thumb would be, when looking at the operating financial statement for the business, the cost of payroll should be one of the bigger, if not the largest cost of doing business.

The reason this is timely has to do with the loss of revenues to both Federal and State budgets. In an effort to recoup shortfalls, agencies are taking a hard look at companies that try to avoid making their necessary tax payments. And here is the kicker, if a company is found to have avoided paying payroll taxes and is levied with past due amounts plus penalties and interest – that liability follows the company owner until it’s paid. Liquidating the company will not resolve unpaid payroll taxes.

His thoughts on Small Business’ challenge to getting access to capital

Here is the podcast:

Click to play

John shared some of his thoughts on how small business’

• Funding will be challenging through 2010 and should be
• Understand Your Customer and What They Expect in Return from Buying and using your product
• Deliver a product that solves real problems and saves money in the short term

He had some thoughts on those who have become entrepreneurs or thinking about becoming one:

• Follow your dream
• Don’t be afraid to start in a downturn. It is actually to your advantage
• Be doing it, not just talking about it

Top 3 Messages that a Small Business should take away:

1. Do Your Research before You Jump
2. Get Very Close to Your Customer and Understand What They Want and are Willing to Pay for It
3. Focus on generating revenue early

More About John

Prior to founding New Atlantic Ventures in 1998, John was a founding investor and the President and Chief Executive Officer of InteliData Technologies, a Fast 50 growth company in both 1997 & 1998.  John led InteliData’s predecessor, US Order, through a successful $65 million IPO in 1995. John currently manages a $225 million venture portfolio at New Atlantic Ventures.

He currently serves on the board of directors of MPowerPlayer, Ftrans, Koofers, Qliance & RemitPro. He is the past Chairman of the Wolf Trap Foundation Board of Directors, the past Chairman of the Northern Virginia Technology Council (NVTC) Board of Directors, the founding Chairman and current Board member of the NVTC TechPAC, and was appointed by former Virginia Governor Mark Warner to co-chair the Virginia Research and Technology Advisory Commission which he served on for 4 years.   John began his career at Bain & Co. and Bain Capital, where he was the first Bain & Co. management consultant to take a full time operating role (as CFO) in a portfolio company.

Tell Us How You are Doing

So how are you and your small business doing out there? What things have you learned on getting access to capital that you would share with your fellow entrepreneurs?

Improving Operations

The SBSI’s calculations in determining a technology score for small businesses specifically tracks the adoption of fifteen online business solutions that help small businesses with marketing, customer service and operations. The numbers point to a whole list of opportunities for small businesses to become more efficient, win over more clients and even save a little money.

The most commonly used technology, as far as small businesses go, is a disaster recovery / backup system. As of December, 2009, 61 percent of small businesses had implemented a backup system of some sort. What’s surprising is that nearly 40 percent haven’t. The expense of data recovery when you don’t have a backup system in place can easily reach four figures, without any guarantee of getting your information restored. Paying a few dollars per month to back up data is a much lower price to pay.

Website Ownership

Right now, website ownership is sitting at 46 percent — less than half of small businesses have a website. When you consider that you can set up and maintain a business website for under $10 a month, that number seems incredibly low. But it is also an opportunity. The benefits of having a website when your competitors aren’t even online allows you to tap into markets that those competitors don’t even have access to.

Email Customer Service

Offering customer service via email can translate into some significant savings. While you may have to have an additional email address, you don’t need anyone manning a customer service line. That can free you or an employee up to do work, only processing customer service questions a few times a day.

Other Technologies

There are plenty of other technologies that can provide big wins for your business. Making use of tools that allow you to communicate and share information internally allow your employees to work more efficiently, no matter whether they’re in the office or not. You can reduce expenses like printing, just by choosing the right tool. Similarly, marketing technologies, such as the ability to list ads in online directories, allow you to improve your reach for new customers. The benefits of improving marketing technologies go beyond price: you can often more clearly see how a customer found your business and made the decision to buy — allowing you to more clearly understand the ROI of a particular ad buy — than with traditional television or newspaper advertising.

Looking at the tools and technologies your business uses can help you find opportunities to become more efficient, save money and even land some new customers.

Image by Flickr user Jose C Silva