• Surveys On Health Care Premiums Show Mixed Results
• Home Office Deduction Reminders From The IRS
• Member Retirement Survey
• Small Businesses Employ Half A Billion Workers In The U.S.
• Family Assistance Key In Micro-Business Success

Surveys On Health Care Premiums Show Mixed Results

According to a study by the Kaiser Family Foundation, which focuses on national health care issues and makes recommendations to policymakers, health insurance premiums increased an average of 7.7 percent in 2006. That’s more than twice as fast as workers’ wages (3.8 percent) and overall inflation (3.5 percent). Others say rates are better than ever. The trade group America’s Health Insurance Plans (AHIP), which represents health care insurers, argues that there has never been a better time to find reasonably priced health care coverage, reporting slightly lower annual rates for companies with three or more employees. “These inconsistencies show how difficult it can be for the self-employed to find adequate insurance,” said Kristie Darien, executive director of the NASE’s legislative office. “If small businesses can’t offer competitive packages, they often lose workers to bigger companies with those benefits.” The AHIP study also found that, among small group enrollees, 57 percent had PPO coverage in 2006, with both in-network and out-of-network benefits. Thirty-nine percent had HMO coverage, often with a point-of-service option. According to the study, about 4 percent had a health savings account (HSA) benefit, with a qualifying high-deductible health plan (HDHP). It also showed that nearly half of respondents enrolled in small group plans chose HSA/HDHP plans when offered a choice of HSA plans and other types of health plans. To help NASE Members wade through the health insurance options available to them, visit http://health.NASE.org. At this site, micro-business owners can discover cost cutting tips, learn about consumer directed health programs, and find information on assessing health insurance needs. Home Office Deduction Reminders From The IRS The IRS Taxpayer Education and Communication office has provided the following article in an effort to educate micro-business owners. For more information about any of the information contained in this article, please contact the IRS Small Business/ Self-Employed division at http://www.irs.gov/smallbiz. NASE Members can also utilize their TaxTalk benefit to receive personalized answers to their tax questions. Home Office Deduction: Basic Requirements Generally, expenses related to the rent, purchase, maintenance and repair of a personal residence may not be deducted as a business expense. However, taxpayers who use a portion of their home for business purposes may be able to take a home office deduction if they meet certain requirements. Expenses that may be deducted include the business portion of real estate taxes, mortgage interest, rent, utilities, insurance, painting, repairs and depreciation. Note: The amount of depreciation deducted, or that could have been deducted, decreases the basis of your property. In order to claim a deduction for that part of a home used for business, taxpayers must use that part of the home: Exclusively and regularly as their principal place of business, as a place to meet or deal with patients, clients or customers in the normal course of their business, or in connection with their trade or business where there is a separate structure not attached to the home; or On a regular basis for certain storage use such as inventory or product samples, as rental property, or as a home daycare facility. In addition, taxpayers working as employees can claim this deduction only if the regular and exclusive business use of the home is for the convenience of their employer and the portion of the home is not rented by the employer. “Exclusive use” means a specific area of the home is used only for trade or business. “Regular use” means the area is used regularly for trade or business. Incidental or occasional business use is not regular use. These requirements are discussed in greater detail in Publication 587, Business Use of Your Home. Computing the Amount of Home Office Deduction Generally, the amount of the deduction depends on the percentage of the home that is used for business. A taxpayer can use any reasonable method to compute business percentage, but the most common methods are to: Divide the area of the home used for business by the total area of the home, or Divide the number of rooms used for business by the total number of rooms in the home if all rooms in the home are about the same size. Taxpayers may not deduct expenses for any portion of the year during which there was no business use of the home. If the gross income from business use of the home is less than the total business expenses, the deduction for certain expenses is limited. Member Retirement Survey Like millions of Americans who run their own businesses, the self-employed face unique issues when it comes to retirement. In order for us to best represent your views, the NASE must collect timely, accurate statistics on the micro-business community and your efforts to plan for retirement. You will be receiving an email with a link to the member survey on retirement. The data we collect in this survey will be analyzed and used to inform legislators at all levels of government about the specific retirement issues and barriers facing small businesses and the self-employed today. The NASE will also use this information to recommend solutions to policymakers to help minimize those barriers so you can continue to grow your business and ensure a secure retirement. Please take a moment to take the survey. Your participation is essential to making the voice of micro-business heard here in Washington, D.C! Thank you! Small Businesses Employ Half A Billion Workers In The U.S. Small businesses employed 57.4 million Americans in 2005, according to recent findings by the U.S. Small Business Administration (SBA). This number accounts for 50.6 percent of the non-farm private sector workforce. The results also showed that small businesses represent a colossal portion of the nation’s employer businesses (99.7 percent). “State by state, the self-employed and micro-businesses continue to be a steady source of employment,” said Kristie Darien, executive director of the NASE’s legislative office. “The SBA report is a clear indication of how vital small businesses are to the economy.” The SBA updates data each year regarding the number and type of businesses, ownership demographics, employment and financing data, and other information. To learn more about advocacy efforts of the Small Business Administration, visit http://www.sba.gov/advo. Family Assistance Key In Micro-Business Success More than two-thirds of micro-business owners (68 percent) say it is important to have family involved in their company, according to a recent online member poll conducted by the NASE. They put it into practice too, with nearly three out of every five owners relying on family to help run their business. Most often, respondents received help from members of their immediate family. Forty-one percent depend on their spouses to help keep operations running smoothly. Children were next in line to help. Over sixteen percent chip in on the family business. After that, parents were the next most likely family members to get involved. “It makes sense that there would be such high levels of involvement, when you think about it. Family members are often the ones who watch a business go from birth to inception,” said Kristie Darien, NASE executive director of the legislative office. “If they’re not working there on a day-to-day basis, they’re hearing about it and talking about it whenever families gather to eat a meal, celebrate holidays, and so on.” After thinking about the future of their company, many micro-business owners could not think of anyone who knew their companies better. When asked about long-term plans, almost a quarter (23 percent) planned to pass their business down to a child or other family member. For the full results of the survey, visit http://advocacy.nase.org/membersurvey/default.asp.