Why Every Employee Should Consider Having a Side Business

by Sandy Botkin, Esq., CPA


As a network marketer, you probably already know about this, but here is a succinct and convincing way to present this idea to a prospect:

Why you should have a business: We have two tax systems: one for employees designed to take your wealth and one for business, which is designed to create economic growth.

If you have a business, you can deduct your losses against any form of income as long as you run your business like a business and *materially participate* in running it.


Moreover, if your self-employed business loss exceeds [...] your income for the year, you can either carry the loss back up to two years, and offset the last two year's taxes paid to the state and federal government or carry forward all business losses up to 20 years. Thus, you never lose properly documented business deductions.

*Materially participate* means that you either put in the substantial hours necessary in running your business or you put in at least 100 hours and more than anyone else, or you work in your business for at least 500 hours per year.

If you were to see who are the multimillionaires in this world, probably 85% of those have businesses. I am stunned at how many people work "like dogs" trying to get ahead in their company.

Frankly, I would recommend doing enough not to get fired and starting a side business with the extra time. Who knows, you might make enough to leave that business and dump your boss, which spelled backwards reads S.S.O.B.

People always ask, "What type of business should I set up?" My answer is to follow your passion. Find what you are good at and master it and learn to market it. There are many proven network marketing opportunities that don't require a lot of cash. The beauty of network marketing is that is comes with a built-in training program and you earn while you learn!

I'll finish up with the following statement my father taught me:
"People get rich doing things others aren't willing to do—and doing them exceedingly well."


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