Jim Schneider's Home-based and Small Business Tax and Investment Resouce site is no longer active at Bigstep.com!

Sohodojo Advisory Board Member
Jim Schneider
The Taxman86 Speaks...
15 August 2000
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How Is Legislation Made: It Is Called The Common Folk; We Repeat, Enterprise Communities Are Important.

1. Have you been to a sausage factory?

Many years ago we passed our CPA Exam and needed 2 years of auditing experience, wow was that fun. The best was checking out the inventory procedures for a meat packing facility in Long Beach, California, called Manhattan Meats. Their hot dogs were the best, but we sure did not like watching them being made.

Today, much like that meat packing process, we watch the formation of tax, labor, and 'you name it' legislation. We may like the results, but not how it is made. Where is all that money [running at $2T a year] coming from, government profits, or our earnings? Who knows better how to spend "our money"? That is the debate. It is also called social engineering to some. Clinton's Legacy? Campaign reform, we doubt it. The big donors win out. It's all about how to be a great lawyer and attach the "proper" labels: it is not fund raisers, it is 'donor servicing' or 'donor maintenance'. See "Wooing Big Donors." Or if you are into the New Economy selling a successful game.

If that is the way the game is played then you better learn the rules. You are either in business or your not. And a non- corporate business does not cut it, it looks too much like a hobby, as the Ninth Circuit Court of Appeals recently said as they affirmed the disallowance of an apple farm activity owned by a dentist who "truly believed" that organic apples were the key to good dental care and his wife's apples were the best [he sold them in his office]. Those same set of facts, in our opinion, even before the Tax Court, would have made it if the Dental Practice was incorporated with the farm being part of the corporate business, and may be a book on good dental practices would have helped out. Put the apples on the Bigstep.Com web site with the book, and the dental practice, and off you go, you are in business. Need a digital camera to make it work, they are coming at $150 or less, with a 2 minute video feature from Intel, says the New York Times.

What does it cost to be in business today? It costs about $59 per month for a complete computer package and DSL from PacBell, a $19.99 Home-Based Business for Dummies from Paul and Sarah Edwards, and Peter Economy, a web site from Bigstep.Com, and the incorporation package for $99 plus costs from Yourself-Inc.Com, and all your utilities, medical costs, and educational expenses are suddenly being paid for by your new employer, with meals and lodging thrown in for good behavior [being on call 24/7/365].

2. The Home-Based Business crowd will rule.

One of our loyal fans sent us the following in response to our comments about High Tech Silicon Valley vs. Home-based Businesses yesterday, "... Our constituency is vigorously independent and poor campaign donors..." That is not the way they do it in Texas we are told.

On the more serious side, the Deep Ellum neighborhood in Dallas, Texas [the former industrial section near downtown] is on a roll, and we love it. And it does take a village. What if these businesses were in the Dallas Enterprise Community, could they get the upcoming tax incentives under H.R. 4936 "Community Renewal and New Markets Act of 2000" passed by the House last month? Check out their addresses on the EZ/EC locator or the HUBZone locator.

Would it make a difference if the businesses in Deep Ellum were on two sides of a census tract boundary, one census tract is in the Dallas Enterprise Community [.04 from the Dallas Enterprise Community], and the other is not? We think so.

If they can do it in Deep Ellum in Dallas Texas, they can do it anywhere, including Las Vegas, Nevada or Phoenix, Arizona, or the East Village/Gaslamp Quarter in San Diego, California, or even in downtown Watsonville, California, which is on OLD Highway 101 between Santa Cruz, California and Monterey, California home to UC Santa Cruz and California State University at Monterey, both of which are going high tech.

3. Where are all the Enterprise Communities?

On July 1, 2000 and July 7, 2000 we listed all 95 Enterprise Communities and their Web sites. If you want that list or other back issues of the TAXMAN86 SPEAKS [1-250] go to our Home Page or to our good friends at Sohodojo. If you have not seen their Small Business Tools Page you have missed something, it is great.

Jim Schneider, LL.M.

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