How do I raise money to finance my own tax business? There is a lot to do between the time you have a great business idea and the time you can make money from this great business idea. The more money you plan to spend, the more you will need a realistic Business Plan. A business plan describes the primary details of a business, such as: management, products / services, operations and finance.
What is Tax Business Finance
Business finance is a term that is related to the activities and disciplines about the management of money and other valuable assets. Business finance programs and methods include: accounting, investment strategies, debt management, leveraging credit and grant writing. Business owners must have a solid understanding of finance to keep their companies profitable.
Sources of Finance for a Tax Business
1) Secured Bank Loan / Home Equity Loan
Secured bank loans can provide an injection of needed cash. Interest rates are lower than other options, but not everyone can qualify for these types of loans.
2) Unsecured Credit Card Loan
Credit cards offer a quick option to obtain startup capital, but at a great price. Interest rates are high. These are best used for emergencies and short-term loans.
3) Online Business Loan
If you cannot find a local bank to finance you, go online. The Internet offers a larger selection of banks and funding institutions to choose from.
4) Invoice Advance
Third party contractors pay upfront and the bill is settled once the client pays. This is often based on the trust built with contractors. If used properly, this allows you to accept more work more quickly. An example of this would be to negotiate a lease agreement or for building construction. The contractor pays the costs up front. You pay the contractor back once you are open for business and servicing customers. You are more likely to get financing like this if the contractor trusts that you will pay them back within a short period of time.
5) Product / Service Presales
Clients pay in advance for future services to be provided or products to be delivered.
6) Friends, Family and Business Relationships
Someone you know might have some spare cash laying around. This type of financing is usually related to very low interest and easy payment terms. Sometimes it is provided as a gift. Be careful not to burn these bridges. If you show that you can properly manage what is given to you, they will often provide more in the future.
7) Transfer Funds from Another Business
If you already have a business that generates profits, you have the ability to reinvest those funds into another business opportunity. This is often a great legal way to lower your business taxes.
8) Sell Assets
If you have something of value, such as a business, real estate, vehicle, or jewelry, you can sell it and use the proceeds to finance a business.
9) Find Investors
There are several types of investors. Some focus on startup companies, others focus on growing companies, and even others focus on companies that may close. These people look closely at your business plan, company financial statements, and track history.
10) Winning a Contest or Lottery
Businesses can benefit from luck or skill in other areas. A professional athlete or gambler at a casino might take the funds obtained and use it to open a business.
11) Rent or Lease Something of Value
If you have a house, car, boat, airplane, designer clothes, etc., you could let someone borrow those items for a fee. Then you can invest that money into your business.
You can use your inheritance and invest it into a business.
Government agencies, universities and corporations provide grants to individuals and organizations that promote their business, cause or purpose. Find and align yourself with those entities and ask for funding. Each organization has its own processes and procedures as to how they provide grants.
The Internet provides a creative way to finance your business – crowdfunding. You develop your business, and ask those who agree with your cause to give you money. The more your cause is known and the more others agree with it, the more likely you are to receive donations.