Few people realize that starting a side-business on eBay is actually a great way to save money on your taxes. The trick is to make sure you’re putting all the additional expenses you incur against your additional income. Running an eBiz allows you to take numerous deductions that can add up to a lot of savings.

Deduct Your Home Office

By definition, if you’re an eBay seller, you have a home office. You have to have a space that’s used exclusively for business, whether it’s in your spare room or your basement. But having this allows you to take a percentage of your mortgage interest, your utility bills, your homeowner’s insurance, and your homeowner’s dues as deductions against your business. And if you use your home to store inventory, even if it doesn’t have its own room, you can include that space in your deductions as well.

Deduct Your Children’s Pay

Rather than giving your kids allowances, pay them to help out with your business. You’re moving income out of your tax bracket, and you can pay them up to $4,900 a year before they’ll have to pay taxes on it. Tax strategist Diane Kennedy, of http://TaxLoopHoles.com, says there are three rules to employing your child:

1. Have some kind of written job description. 2. Make sure they’re keeping track of the time they actually work. 3. Pay them a reasonable wage.

Says Kennedy, ‘Take a look at