Heavy Equipment| Looking for Heavy Equipment ?

The idea is to have financial and directional control on a large construction project (restaurant/lounge). To avoid being ripped off by construction companies or individuals, I want to set up a construction company that would essentially win the bid and outsource to individuals and companies. Those would all work under the umbrella of my company, and would be payed as technicians who brought their experience. My company would be responsible for procurement of building material and some equipment. What do you guys think?

This is the function of the architect

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The financial benefits of an SBA loan include:

• Less Money - The commercial mortgage loan credit enhancement provided by the guarantee of the SBA can substantially reduce the amount of money required to be submitted for the purchase of a commercial property. Sometimes 100% financing for purchases, refinancing, renovation and construction of properties is available under the program 7a.
• Periods of longer amortization - An SBA loan allows a commercial repayment period longer than most conventional commercial lending, which lets you keep your mortgage payments and improve commercial low cash flow. Until 25 years commercial loans are available under the program 7a. The 504 Program is used a first commercial mortgage with a minimum term of 20 years and a second mortgage with 20 years at a fixed rate.
• No balloon payments - You will not be forced to refinance its SBA loan business at any time.

Typical examples of an SBA loan borrower on the 7th are:

• A borrower who wants to buy a company with or without commercial real estate who do not want your loan is limited to the collateral value of hard.
• A borrower who wants to buy or build a commercial building and wants up to 90% of mortgage financing business.
• A borrower to buy or start a business with guarantees.
• A borrower who wants to fund most of the closing costs on the loan.
• A borrower who want a partner for acquisition or purchase of a professional practice and wants 100% financing

Purpose
The Small Business Administration (SBA) 504 loan program was created to help small and medium businesses to acquire the owners of commercial real estate without paying requirements of a traditional commercial mortgage loan. To qualify, 51% or more of the property must be held by borrowers of business if it is a purchase price of compromise. If this is a construction loan borrowers of business should occupy a minimum of 60% of the property. Part of the property does not have to be held in the name of the company or the borrower (s) individually. It is common for a holding company that was formed to take ownership of the property and then lease it back to the operating company. There are certain eligibility criteria at the 504 commercial mortgage loan programs:
The average company net income can not exceed $ 2.5 million after taxes for the previous two years.
The project envisages the size must be more than the personal, non-retirement, unencumbered liquid assets of the guarantors / directors.
Tangible net worth of the operating companies has $ 7.5 billion or less.
The loan of 504 requires a new job was created / retained for every 35,000 U.S. dollars provided by the CDC (Certified Development Company), unless the company complies with other public policy objectives
Passive investment companies, nonprofit corporations, lending institutions, commercial real estate development companies, and some other types of businesses are not eligible for 504 loans.

Structure
The format of the 504 commercial mortgage loans employs a traditional first mortgage from the private sector for 50 percent of the total project cost. The costs of the project includes the cost of land and existing buildings; hard construction, renovation costs, soft costs, and most commercial mortgage loan closing costs. The private lenders note is independent and carries its own pace, terms and conditions. A second mortgage of the CDC is used for a maximum of 40 per cent of project costs. Borrowers’ own capital is the remaining 10 percent. If the property is special-purpose in nature or is a start-up business, borrower’s injection is increased to 15%. If the property is special-purpose in nature and is a start-up business, borrower’s injection is increased to 20%. The costs of the projects are funded in whole with the loan of 504 unlike the majority of commercial bank loans to finance only a minor percentage of the purchase price or value.. If the borrower decides to sell their property, these commercial mortgage loans are always assumed that the buyer meets the requirements under the SBA guidelines.

Less paperwork than you think!
The SBA has worked hard in recent years to reduce the amount of paperwork required to apply for this loan.

No fees are added.
It is true that rates are slightly higher for this type of commercial loan, but the fact that these loans are trading for 25 years eliminates the need to refinance, and therefore maintains the average cost of financing the commercial life of property to a minimum ..

The SBA commercial mortgage loan closes very quickly.
We can make a lot of SBA 504 loans in 60 days, which is roughly the same amount of time a traditional commercial loan if you’re not in a hurry. However, the pre-approval from the norm for many specialized SBA lenders is becoming 24 to 48 hours, with commitments in four to five days.

Borrowers do not have to use your house as collateral.
Most of the 504 loans only to ensure the commercial property and / or equipment that is being financed. Most commercial mortgage lenders do not require something home as collateral.
Borrowers with imperfect credit histories can qualify for the SBA loan.
The 504 commercial mortgage loan programs are able to approve people with personal bankruptcy, as has happened more than 7 years ago. The SBA also is authorized to approve those with misdemeanors and felonies, but the process will take a little longer to close by http://www.pro-bargainhunter.com.

Pro Bargain Hunter
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INTRODUCTION

Whatever the silence or the contradicting comments be coming from the Indian government and its leading economists, the start of eroding effects of world depression 2008 in India can not be overlooked since the depression stands well entered in the Indian economy. The economic activities like the decision regarding closure of Tata’s Jamshedpur motors plant for three days, decision of Ashok Leyland to run only for three days a week for coming two months, decreasing interest rates, decrease in CRR, lowered REPO rate, cut in SLR, index of stock market in reverse gear, Rs 275000 crores (Rs 2750 billion) released by the Reserve Bank of India (RBI) to help industries and investors etc. already indicated and rather proved well in the first week of November 2008 that RBI and the Government accepted the entrance of depression 2008 in the Indian economy.

PRE-DEPRESSION SITUATION

After getting independence in 1947 India started its planned economic development in 1951 having in hands the experience, a wide literature of well proved strategies and variegated plans pertaining to, used by and created or formulated by the well developed western economies, apart from the available natural resources. India was over enthusiastic and over ambitious on account of having the ready and well proved weapons sought from the western world for combating the problem of development. Therefore, instead of starting from the very beginning and covering the whole path it, being enticed and allured by the surprisingly fascinating fruits of industrialization, started efforts but having longed for being developed and grabbing fruits thereof in a haste. Thus India lost sequences in its development path. It ignored agriculture that was the spine of the economy. Thereby the agricultural development lagged far behind the level required for feeding India’s industrialization up to the mark. Agriculture based small and cottage industries became shattered and the villages became ruined. This raised a huge bulk of unemployed people in the widely spread rural sector.

The unemployed persons started migrating to the urban areas in search of job. The urban development and industrialization there had not sufficient level to absorb the whole migrating mass and to provide them proper urban life facilities. As a result thereof a mushroom growth of slums came about fast which eventually turned into big slum spots in cities and towns within a no longer period of 20 or 25 years. This hampered urban growth and urban life. On the other hand, in rural areas there emerged acute shortage of energetic workforce, service centres, infrastructure, intellectuals etc. This hindered the rural development whereby agricultural development and rural life remained slang lower. That is why, even having travelled a long path of planned economic development, the state of affairs of rural India still remained almost the same as it had been before planning. There remained a big gulf between urban and rural people regarding wealth, wage, education and income. Moreover, the rural-urban migration, due to the pitiable state of affairs in rural areas, resulted to unchecked urban growth. Thus, instead of overall development, an unbalanced and unfair development of Indian economy became resulted therein.

 However, the Central Government tried to make the situation better by initiating the process of economic reforms in 1991. But, unfortunately, the formulation of this process was on almost the same footings as those of the Five Year Plans and, therefore, this also could not bring about the desired change. Consequently a wide spread general unemployment prevailed in both the rural and the urban areas {as per ECONOMIC APPRAISAL 2006-07, the estimated number of unemployed persons rose from 7.98 million in 1983 to 9.02 million in 1993-94, to 10.51 million in 1999-2000 and to 13.10 million in 2004-05. These figures make amply clear that the average increase per year in the number of unemployed persons was going higher and higher without revealing any effect even of the economic reforms initiated in 1991. The average increase per year in the number of unemployed persons was 1.04 lakh (0.104 million) persons during the ten years’ period from 1983 to 1993-94. It became 2.48 lakh (0.248 milliom) during the next six years’ period and rose to 5.18 lakh (o.518 million) during the five years’ period from 1999-2000 to 2004-05.}. In addition to this a considerable number of politically, socially and economically sound and effective elites emerged in cities and urban towns. These elites interfered in the formulation and execution of development plans, on one hand, and in the fixation of priorities, on the other. Thereby Indian development plans became urban oriented and concentrating on rich minority. Thus the poor majority and the rural economy became ignored. The unemployment situation in both the rural and the urban sectors became almost uncontrollable. The government has become politically weak. Therefore its priority has become to please the rich minority so that it may run. To mitigate resentment and dissatisfaction among the general mass it has to play pseudo role to remedy some times the rural and some times the urban mass alternating through various unsuccessful employment programmes and plans. The condition of the rural unemployment is more embarrassing than that of the urban unemployment since the rural unemployed people are subsisting in privation.

The increasing inequality in income distribution and persistent lack of capital in India like other developing economies became more rigorous on account of the black money. Therefore, the Indian economy had been but experiencing inflationary pressure up to the late eighties on account of heavy autonomous (unproductive) investment in welfare and employment schemes (apart from that in infrastructure) by the governments being dependent on foreign aid, World Bank financing, external debts and deficit financing.

EMERGENCE OF DEPRESSION

 As the eighties end and the nineties begin the inflationary trend started being converted into depressive trend in the developing economies also on account of the following events.

(i) A considerable part of black money came out and became converted into white money on account of various schemes, moves and drives to convert black money into white. It was added to productive investment and whereby an increased supply in the market came about. Though employment also was thereby increased to add to the demand but lesser was added to demand than to supply due to highly unequal income. d

(ii) Under the process of globalization MNCs were allowed to enter  the economy. The MNCs made heavy productive investments and thus considerably added to the total supply in the markets but the thereby increased employment could not equally add to the total demand because a considerable part of their production value (revenue) went to their respective mother countries in the form of profits. Moreover these MNCs kept considerable part of their revenue in the form of undistributed profit deposited generally in the foreign banks.

(iii) The expansion of share markets took impetus in developing economies in the middle of nineties on account of some small scams and computerization of stock exchanges. However, a big scam always creates uncertainty in stock exchange activities and therefore harms the share market. But, contrarily, small scams always help increase the stock exchange activities because small scams create small but frequent ups and downs in share prices.

(iv) The globalization made the access of the depression stricken developed economies easy to the Indian markets. Therefore, the gluts of consumer goods started being dumped there. The goods produced in developed economies are of better quality and cheaper (on account of lower production cost) and the consumption of the Indian mass is highly conspicuous. These two factors attracted the Indian consumers towards those dumped goods so much that the demand of consumption goods pertaining to India’s home production became lost up to a considerable level.

THE PRESENT SITUATION

Each of the events discussed hereinabove contributed towards increasing the supply but decreasing the demand of consumption goods in the Indian economy. The combined effect of these events made a considerable change whereby up to the mid of year 2008 the Indian economy came into the grip of depressive trend in its markets other than the market pertaining to basic consumption items. The market of basic consumption items is still showing high prices and inflationary pressure. This is because the depression starting from financial and industrial giants will take some time in trickling to trade and medium or small industries of general consumption items. The downward trickling of the depression will gain impetus as soon as heavy retrenchment starts in the depression stricken giants.      

The following detail, prepared on the basis of columns in the news papers from 1st to 8th of December 2008, makes it amply clear the present extent of depression and the steps taken to control the situation in Indian economy.

(1)Stop production in Telco Construction: One more company of Tata Group, Telco Construction Equipment Co. Ltd. (TELCON) declared to stop production for four days (from 4th to 7th Dec.) in its Jamshedpur plant. This company has experienced a 50 % decrease in its production during last one and a half month. Mr. Ramchandra, President of the Telcon Workers Union, told that the plant has observed ‘block closer’ (stop production) two times in the last one month. Moreover, the Diesel Engine manufacturing company of joint ownership of Tata Group also exercised block closer for 5 days in the last week. India’s leading commercial vehicle manufacturing company, Mahindra and Mahindra, experienced a fall in the sale of its vehicles from 18583 vehicles in November 2007 to 11569 vehicles in November 2008. The total sale in the last year was 17844 vehicles which fell down to 10430 vehicles this year. The second biggest passenger car manufacturing company in India, the Hyundai Motor India Ltd., also experienced a 23.3 % decrease in its sale in home market in the month of November 2008 as compared to that in the month of November 2007. The home market sale in November 2008 is 14605 cars as against 19052 cars in November 2007 (Hindustan, Hindi Daily, Dt. 03.12.2008, Page 13, Baghpat Edition).

(2)Tata Motors has again decided to close its Pune plant for three days, from 5th to 7th of December 2008.. It is second time in the last fortnight that the company has decided to stop production (Hindustan, Hindi Daily, Dt. 04.12.2008, Page 13, Baghpat Edition).

(3)During the week ending on 22nd of November the inflation rate fell down 0.44 point and came to 8.40 % as it was 8.84 % in the week ended on 15th of November. The inflation rate in the week ended on 2nd of August this year was 12.91 % that was the highest inflation rate observed in last 16 years (Hindustan, Hindi Daily, Dt. 05.12.2008, Page 13, Baghpat Edition).

         (4)The second biggest car company in India, Hyundai Motor India Ltd., decided to sell its popular model, SANTRO GL (Solid) model, at 10 years old price of Rs 2.99 lakh (Rs o.299 million) for coming 10 days. A relaxation worth Rs 15,773 in the form of free insurance and accessories is being given in non-AC segment. Relaxation worth Rs 26,000 on SANTRO GLS model and from Rs 7,000 to Rs 25,000 on GATZ, Accent and Verna models is being provided. India’s biggest car company, Maruti, has already started giving discount from Rs 15,000 to Rs 35,000 on its cars. Moreover, the General Motors has made discount worth Rs 58,000 on SPARK. A discount worth Rs 90,000 on FORD FIESTA is being given. Tata Motors also is giving relaxation on its cars from Rs 20,000 to Rs 30,000 (Dainik Jagran, Hindi Daily) Dt. O5.12.2008, Page 13, Baghpat Edition).

(5)Mr. G. K. Pillai, Commerce Secretary, stated on Wednesday, December 6, 2008, that a budgetary help worth Rs 150 billion (Rs fifteen thousand crores) would be given to infrastructure projects while a help worth Rs 20 billion (Rs two thousand crores) would be extended to the depression stricken exporters. First time in a period of last ten years there has been observed a decrease of 12 % in Indian export business. As per the government survey of 121 export oriented units, 65 thousand jobs have been cut during last three months. Seven thousand jobs stand cancelled in cloth sector and this figure may reach to 1.2 million (twelve lakhs) up to the end of the current financial year. On account of realizing the depressive pressure in the economy, the Indian government has declared a decrease of Rs 5 in petrol prices and Rs 3 in diesel prices (Hindustan, Hindi Daily, Dt. 06.12.2008, Page 13, Baghpat Edition).

(6)Under the heading ‘Recession Trickles to India’ there has been stated “After years of being blamed for job losses in America and elsewhere, domestic high-tech companies and outsourcing firms are going through a downturn of there own. The global showdown id forcing them to reduce hiring, freeze salaries, postpone investment and lay off software programmers and call centre operators.” The country has been suffering from the effects of global slump, losing capital as Western investors fled to the security of American Treasuries, undermining Indian banks and company balance sheets. Satyam Computer Services slashed its recruitment plan to fewer than 10,000 from 15,000. Some companies, having hired recruits, are postponing their start dates. Wipro has dismissed 2.5 per cent of its work force in the second quarter. American Express laid off some 200 of its 6,000 workers in India and Goldman Sachs announced last month (November) to dismiss about 10 % of its work force in India (Hindustan Times, English Daily, Dt. 06.12.2008, Page 17).  

(7)A third block closer (stop production) within a period of mere one month has been declared by India’s biggest vehicle manufacturing company, Tata Motors, in its Jamshedpur plant from 8th to 13th of December 2008 in succession to its already observed second block closer from 5th to 7th December. In addition to it, the leading diesel engine manufacturing company Tata Cummins, a company of Tata’s joint ownership, is observing a six days block closer in its Jamshedpur plant from Saturday, the 6th instant. This is its second block closer as the first was from 26th to 29th of November. SBI has declared a special loan facility of Rs 110 billion (Rs 11000 crore) to help housing and small industries. RBI has decreased the REPO rate from 7.5 to 6.5 % and the Reverse REPO rate from 6 to 5 %. Yes Bank has declared a cut of 0.5 % in PLR while ICICI Bank has declared a cut of 1.5 % in PLR and BPLR (Hindustan, Hindi Daily, Dt. 07.12.2008, Page 1 & 13, Baghpat Edition).     

(8)Mr. Sameer chopra, President, BPO Industry Association of India, told that America and Europe, on account of the wage cut policy of companies and to combat the market slump, are thinking of stepping back in near future from alternatives like outsourcing. If this happens the Indian companies will be most affected negatively since most of the Indian software companies depend on America and Europe for business. Thus the jobs of 0.25 million (2.5 lakhs) persons, working in Indian BPO sector, are under threat of the global depression and they may lose their jobs in the first quarter of the next year (Dainik Jagran, Hindi Daily, Dt. O7.12.2008, Page 16, Baghpat Edition).

 (9)To control the continuously increasing prices and to rescue the economy from depression grip, the Central Government of India declared yesterday, the 7th of December 2008, a bailout package worth Rs 30 Kharab (Rs 3000 billion) (Hindustan, Hindi Daily, Dt. 08.12.2008, Front Page, Baghpat Edition).

CONCLUSION

The above mentioned detail shows that the remedial measures, being taken to control depression in the Indian economy, are the same and on the same line as those taken by America and European countries. India had also committed the mistake of using as well the tools proved fruitful in the western world, in case of economic development move. I think, in case of combating the depression 2008, India will again repeat the mistake of using the same tools which the western world is using without getting success in controlling the depression. Therefore, India should recognize the difference of its economic features as compared to America and the European countries and find compatible ways and means to control and combat the depression 2008.

V P Singh
http://www.articlesbase.com/economics-articles/depression-2008-the-indian-scene-674931.html

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Let’s say I’m starting a small air charter business. My largest depreciable assets are of course the aircraft, worth 1.5 million. We will be financing the aircraft over 20 years, not buying them outright. So I have my typical office, insurance, and other start-up expenses, then I have some short term assets like tables, signage, office equipment, etc.

Where do I justify the aircraft? My business plan software wants to put the aircraft down payments as part of the start up EXPENSES. It wants to put the ENTIRE VALUE of the aircraft under start-up ASSETS. Is this right? Why do I need the entire value of the aircraft as a start-up cost? We are financing them, making down payments and monthly payments, not buying them outright. If I list the aircraft as a start up asset cost, my total start-up funding will show close to 2 million required, with 75% of that being the value of the aircraft. I don’t need close to that to open my busines doors. I need maybe 25%.

find u a good cpa,
i persume u are leasing to own the aircraft, this will show up as an asset, but the balance amount should show as a liability. sounds like u dont own "all" of the plane, so its an asset but not all of it.

good bookkeepers, remember, if u dont know where ur at, theres now way to know how to get to where ur going

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i recently closed my business and had a leased copier, which had gone in to default with the leasing company, and into collections with the finance company. my lawyer advised me since i have no assets they could not collect anything from me, even if they file a lawsuit, but my main concern right now is what do i do with the copier? who do i contact to come get it? the original equipment supplier, the finance company, or the collection agency? it belongs to someone, and i do not know where to start.

As long as you did not sign a personal guarantee, you’re no longer liable. You should read the lease agreement and see what your obligations are in case of default. Make sure you don’t give it away to the wrong party. You could get into trouble for disposing of goods which are not yours. If in doubt, ask your lawyer. If he’s going to charge you, ask the lease company.

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Now it’s time to determine how you will finance your new business. Fees associated with purchasing a franchise may include franchise and royalty fees, equipment, inventory, working capital and more. The first step is to take inventory of your financial resources by creating a personal finance statement to verify your net worth. This statement should include a listing of both your assets and liabilities.

A list of your assets may include:

• Cash on hand
• Checking and savings accounts
• Real estate/property
• Automobiles
• Investments such as stocks, bonds and securities
• Pensions and IRA’s

Once you have determined your resources available to put towards a new business, you can decide which financing option is right for you based on the start-up and total capital required. Below are some of the options available for financing a franchise:

Cash
Depending on the amount of liquid capital you have access to, you may be able to pay cash for your business. However, you should be sure that you’ll still have enough cash on hand after purchasing a franchise to grow your business, especially if you are interested in a multi-unit operation.

It’s important to consider that approximately 99% of businesses are started with borrowed money, including many of today’s largest corporations. So don’t feel that you need to have all of the cash required for your investment on hand, or that you must use all of your available cash to start your franchise business. There are many other options available to supplement cash investments.

Conventional Loans
In general, lenders are more likely to approve loans for franchisees versus independent business owners. However, keep in mind that most lenders will require you to put down approximately 30% of the total capital needed to purchase your business. In addition to a personal finance statement, most lenders will also require you to provide a detailed business plan describing how your business will operate. The plan should include projected income and expenses through the first three years of business.

Remember that you must do your homework before approaching a lender. They will want to know that you have researched all aspects and feel confident that you are capable of operating a successful business. In addition, it’s also a good idea to pull your credit report before meeting with a lender to identify any mistakes or negative reports so that you can correct any errors as well as be prepared to explain any past credit problems.

SBA Loans
Before contacting a traditional lender, you can find out if you are eligible for a U.S. Small Business Administration (SBA) Loan by contacting your local SBA office. Though these loans are furnished by private banks and other traditional lending institutions, a portion of the loan is guaranteed by the U.S. Small Business Association. The benefits of an SBA Loan for franchisees include expedited loan processing, competitive rates, and longer terms. As well, most of the bank fees often charged with a conventional loan may be waived with an SBA guaranty.

You can also look into whether or not a franchise is listed on the Franchise Registry when selecting an opportunity. Loan applications for SBA approved franchises are typically reviewed and processed more efficiently by the SBA and its lenders because through the Registry process the franchise agreements have already been reviewed. Franchises not listed on the Registry must have their agreements reviewed and evaluated at the time you apply for SBA lending which can take time.

Franchisor Financing
Some franchisors may provide either direct or indirect financing for franchisees. Direct financing, where the franchisor directly finances the franchisee, is less common but some companies do offer it. With indirect financing, the franchisor locates a third-party lender for the franchisee through a company the franchise has an established relationship with. Still, with either type financing, you will be expected to pay a percentage of the cost just as you would with a conventional loan as franchisors rarely offer 100% financing. Some franchisors may also offer leasing options for hard assets such as equipment, vehicles or machinery.

Retirement Funds
Another alternative to traditional funding options is to tap into your 401(k) or IRA funds to start your business. Qualifying retirement funds may be drawn upon as a capital source without incurring taxes or penalties, and can also be used in conjunction with traditional and SBA financing helping to alleviate some of the debt associated with obtaining a loan.

Second Mortgage
A second mortgage loan may be obtained on your home or other piece of property and in some circumstances can be the simplest way to get the money you need to buy a franchise. Rates are typically low and the interest can be written off. However, it is important to keep in mind that you could be risking your home when choosing to obtain a second mortgage on your primary residence.

Investors
When you borrow from a lending institution to finance your business, you retain full ownership of the business and have no further obligations once the loan has been repaid. With an investor, you don’t have to repay the money invested in the business, but you will share the profits.

There are two types of investors, active and passive. Generally, active investors take part in the day-to-day operations of the business and passive investors do not. If you do decide to use an investor to help finance your franchise you should consult with an attorney to draw up an agreement.

The bottom line is that investing in any opportunity involves some degree of risk. You must decide based on your resources, responsibilities and ability to sacrifice the best way to move forward keeping in mind that it may be a combination of a few of the options discussed above. Do your research and have all documents in order so that you may present yourself in the most attractive light to lenders, and remember that persistence pays off.

Stephan Baldwin

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As we come to the conclusion of 2008, many businesses have lost money in this year. The economy for 2009 looks very volatile and some industries may start to recover in 2009, while others may take a little longer. One positive area to bring to the table is that the price of oil has decreased significantly and regular gas prices have come down below $2.00 or so per gallon depending upon your location.

The question through this difficult year where losses have mounted up, why do you have to tax plan? If you were profitable in year 2006 and/or 2007 and paid business taxes in those years, you may be entitled due a tax refund in 2008 to recover part or all of these monies paid in previous years. This tax recovery is called a net operating loss carryback claim…This situation applies to proprietorships, corporations, limited liability corporations, and so forth.

The first part of this discovery phase is to identify whether you are a qualified individual and/or company to recapture monies paid in from prior years…It would be a good idea to obtain from your accountant, bookkeeper, CPA, or your own in house books an updated balance sheet and profit and loss statement for 2008. Additionally, you may want to locate your 2006 and 2007 either personal and or corporate tax returns and review the past years information. If you have paid business taxes in those past years and are in loss situation for 2008, there is a good chance you will be able to recover either partial or all monies paid to the
government for 2006 and/or 2007.

.If you are a farmer and have losses in 2008, you should locate your 2003, 2004, 2005, 2006, and 2007 prior years tax returns because your eligible carryback years extend back for five years. Everybody else, for the most part, can carry back their business losses two years…

Once you have located your prior years tax returns and reviewed the business taxes paid into those years, compare this to the 2008 Profit and Loss Statement. It is good idea that your 2008 information should be current and accurate because it could have a major effect on your decision making. Assuming you are in a loss situation for 2008, you may want to plan you year end cash flow accordingly. For

this illustration, we will assume everyone is on a cash not accrual basis accounting system. Because of your tax situation and the possibility of recovering a tax refund back in early 2009, you may, if cash flow permits, pay more bills in December 2008 than the normal January 2009 payment cycle. The bottom line here is that a qualified professional should be assisting you at this stage because of the cash flow and tax effect though the period ending December 31, 2008. The professional cost vs tax recovery benefit could be a big plus to you.

This carryback claim process is important because it can generate needed working capital if the economy hasn’t recovered in your niche for 2009. Additionally, with all the available acquisition and financing deals available for commercial vehicles, construction trucks, office equipment, computer systems etc, these monies could be used as a down payment or a combination of working capital and acquisition funds.

These carryback claims can be carried back two years, except for farmers, five for them, and if needed carry forward for twenty years. It doesn’t matter what your business structure is…There are exemptions to these rules and you should consult your tax professional for advise on these carry back and carry forward rules.

For illustration the types of industries that would qualify for these carryback losses include construction, trucking, farming, restaurants, all retail shops, mail centers, franchise operations, consulting firms, manufacturers, wholesalers, service providers, This is obvious a partial list of qualified businesses. In addition, the type of entity doesn’t play a role in these carryback claims. There are a few exceptions to the rules, therefore consult a good tax adviser.

In addition to the carry back rules, there are numerous business and individual tax changes for 2008. It would be a good idea to get a head start at the end of this year to understand them and see if there are any you want to take advantage of before December 31, 2008.

In conclusion, 2008 was a trying year for many, but this recapture of tax monies shouldn’t be ignored. If done properly, you can get a head start on 2009 and have a profitable and less stressful year… … Who says Tax Planning is boring

Rick Reed
http://www.articlesbase.com/taxes-articles/business-losses-tax-refunds-for-2008-2007-2006-745152.html