11. Legal/Professional Services Payments to accountants, lawyers and other professionals for services related to your Mary Kay business

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Henry Chase
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1 TAX TRAINING Every year Mary Kay posts the latest up to date forms on intouch. You can find them by going to and click on resources and then click on Tax Essentials Have a separate checking account with a debit card for your business. a. If you have checks printed, do not have the words MARY KAY printed on them. You can put something like Cosmetic Account but not the words Mary Kay, Mary Kay Cosmetics or even MK on your accounts, unless you purchase the printed checks offered on MKConnections. 2. Maintain a daily business log. This is critical for supporting expense deductions you might want to claim. Record in your datebook all details of appointments and any other expenses as well as your mileage. 3. Save all your business related documents and records in an accordion file folder or use individual large manilla envelopes for each month. File away all receipts and pink tickets, packing sheets that come with your orders. Weekly Accomplishment Sheets are not a substitute for your pink tickets. (See the attached Tax Labels for your convenience). 4. Keep track of products you have taken off your shelves for your personal use. An easy way to do this is by taking a consultant order form (one comes in your monthly Applause Magazine) and put hash marks during the quarter of any products you take off your shelf. 5. Using the Tax Record Checklist and the Money Matters for Dream Achievers Tax Worksheet record your monthly income and expenses and then file it in the monthly envelope for final use at Tax Time. You will be glad you did! 6. For more details and federal tax forms, be sure you check out the fantastic training and forms Mary Kay corporate provides us. Just log onto and click on Resources and then click on Tax.

2 Print on Avery Labels 8160 or something comparable 1. Gross Receipts or Sales Sales tickets from sales of Mary Kay product and bank deposit slips 11. Legal/Professional Services Payments to accountants, lawyers and other professionals for services related to your Mary Kay business 21. Wages Hourly wages or salary paid for office assistance 2. Returns and Allowances Receipts of product returned to you for refund or exchange 12. Office Expenses Business-related office supplies and postage stamps 22. Other Expenses/Bank Service Charges Service charges on business bank and credit card accounts, money order fees, credit card processing fees 3. Cost of Goods Sold Receipts to support purchase of product (i.e. packing slip), shipping/handling paid to the Company, record of personal use and product given as hostess gifts 13. Rent on Vehicles, Machinery and Equipment Business portion of auto lease expenses plus any leased office equipment 23. Other Expenses - Freight Charges for shipping product to customers, team members, etc. 4. Other Income Monthly commission statements, Income Advisory Statement & Form 1099-MISC for commissions, prizes and awards earned from the Company and fair market value of prizes received from others. 5. Advertising Company-produced sales literature, business cards, newspaper ads, Mary Kay Personal Web Site program, names submitted for Preferred Customer Program, etc. 6. Car and Truck Expenses Mileage log, business portion of gas receipts, repairs, maintenance, insurance, tires, oil, interest on car loan, parking fees, tolls and auto property tax 14. Rent on Other Business Property Rent or lease on office, if separate from home 15. Repairs/Maintenance Cost of repairing equipment used in your Mary Kay business 16. Supplies Cost of sales aids, Section 2 items, and other supplies used during sales appointments (i.e. cotton balls), Starter Kit, etc. 24. Other Expenses Gifts-with- Purchase Cost of most Preferred Customer Program premiums 25. Other Expenses Hostess Gifts Other than Mary Kay Products Cost of Section 2 items given as hostess gifts (limited to $25 or less) 26. Other Expenses Bad Debt Returned customer checks or refused credit card payments you are completely unable to collect 7. Commissions and Fees Dovetail commissions and amount of prizes awarded to others 17. Taxes and Licenses Business & occupation taxes, gross receipt taxes, local business licenses and nonrecovered sales tax 27. Other Expenses Any other expense category not already listed elsewhere 8. Depreciation Depreciation on automobile, equipment and portion of home used in your Mary Kay business 9. Insurance Mary Kay product protection insurance and general liability. Does not include homeowner s insurance, life, auto or health insurance 18. Travel Datebook or daily planner for documentation, business travel expenses such as transportation, lodging, tips, convention fees, etc. 19. Meals and Entertainment Datebook or daily planner for documentation, meals from business travel and meals and entertainment directly related to your Mary Kay business 28. Expenses for Business Use of Home Maintenance, repairs, utilities, taxes, mortgage interest, etc. Documentation for Tax Year

3 Print on Avery Labels 8160 or something comparable 10. Other Interest Interest on business loans and business credit cards 20. Utilities Long distance business calls, business portion of additional phone features such as call waiting, cost of a second phone, if dedicated solely for business use

4 Record Checklist Income Sales tickets (including Customer Delivery Service CDS) Form 1099-MISC Income Advisory Statement Monthly Consultant Statement Independent Sales Director Commission Schedule Bank deposit slips and statements Inventory/Product Sales Consultant order forms Packing Slips/Invoices from product orders (including CDS) Non-business use records Copies of money orders, cashier s checks, credit card receipts for product purchased Year-end inventory counts Record of product given as gifts Non-recovered sales tax Business Use of Your Home Expenses Repairs and maintenance receipts Insurance premiums Mortgage interest Rental payments Painting and roof repairs receipts Real estate taxes Utilities Automobile Expenses Business mileage log Gas receipts Repair bills Tires, oil, supplies, etc. Lease payments Car insurance payments Registration fees Interest on car loan Parking fees and tolls Personal property tax Cost of vehicle for the depreciation deduction Business Travel Expenses Lodging Meals Transportation Cleaning and laundry expenses Business calls Tips related to above expenses 10

5 Business Meals and Entertainment Meals Entertainment Other Business Expenses Advertising Proof of bad debts Product and liability insurance Interest and loan documents on business loans and credit cards Legal and professional services (personal tax advisor) Office expenses Rent on business property Repairs and maintenance on office equipment Supplies Taxes and licenses Business telephone bills Wages paid to an assistant/household help Dues and publications Freight bills Preferred Customer Program premiums Hostess gifts 11

Tax Worksheet for the Month of Income Total Gross Receipts or Sales Sales of Mary Kay product Returns and Allowances Retail amount of product returned to you for refund or exchange Cost of Goods Sold

6 Tax Worksheet for the Month of Income Total Gross Receipts or Sales Sales of Mary Kay product Returns and Allowances Retail amount of product returned to you for refund or exchange Cost of Goods Sold Amount of Section 1 wholesale product purchased from the Company, shipping/handling paid to the Company and amount of product given as hostess gifts/personal use Other Income Commissions, prizes and awards earned from the Company and fair market value of prizes/awards received from others Expenses Advertising Company-produced sales literature, business cards, newspaper ads, Mary Kay Personal Web Site program, names submitted for Preferred Customer Program, etc. Car and Truck Expenses Business portion of gas receipts, repairs, maintenance, tires, oil, interest on car loan, parking fees, tolls and auto property tax miles Commissions and Fees Dovetail commissions and amount of prizes awarded to others Insurance Mary Kay product protection insurance and general liability only Other Interest Interest on business loans and business credit cards

7 Legal/Professional Services Fees for business-related accounting, tax and legal services Office Expenses Business-related office supplies and postage stamps Rent on Vehicles, Machinery and Equipment Business portion of auto lease expenses plus any leased office equipment Rent on Other Business Property Rent or lease on office, if separate from home Repairs/Maintenance Cost of repairing equipment used in your Mary Kay business Supplies Cost of sales aids, Section 2 items and other sales appointment supplies (i.e. cotton balls), Starter Kit, etc. Taxes and Licenses Business & occupation taxes, gross receipt taxes, local business licenses and nonrecovered sales tax Travel Business travel expenses such as transportation, lodging, tips, convention fees, etc. Meals and Entertainment Meals from business travel and meals & entertainment directly related to your Mary Kay business ( 50% is allowable) Utilities Long distance business calls, business portion of additional phone features such as call waiting and cost of a second phone if dedicated solely for business use Wages Hourly wages or salary paid for office assistance. Please note that such payments are considered wages subject to withholding and reporting requirements. There are additional complexities for wages paid to a spouse or children or domestic help. It is recommended that you contact your personal tax advisor for advice on these matters. Other Expenses Bank Service Charges Service charges on business bank and credit card accounts, money order fees, credit card processing fees Other Expenses Freight Charges for shipping product to customers, team members, etc. Other Expenses Gifts-with-Purchase Cost of most Preferred Customer Program premiums Other Expenses Hostess Gifts Other than Mary Kay Products Cost of Section 2 items given as hostess gifts (limited to $25 or less) Other Expenses Bad Debt Returned customer checks or refused credit card payments that you are completely unable to collect Other Expenses Any other miscellaneous business expenses not already listed

8 Expenses for Business Use of Home Maintenance, repairs, utilities, taxes, mortgage interest, etc. The tax worksheet is intended to be used for general informational purposes only. It is not intended to be and shall not be considered tax advice. We recommend that you consult your tax/legal advisor with expertise in your local area to ensure that you are in compliance with federal, state and local laws.

1. Book 2 appointments Daily: 2. Sell (2+2+2): 3. Coach: 4. Interview: 5. Help Team Member: 6. Everything else (9pm 9am): What is it?

Class 6: Time & Money Management Time Management Success is hidden in your daily routine John Maxwell 6 Most Important Things to Do List (Sample in your MK datebook) 1. Book 2 appointments Daily: 2. Sell