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Keep a stash for Uncle Sam
Another factor that is too often forgotten is the amount of money you have to pay the tax man. Before you make the leap to full-time entrepreneur, calculate the net amount you need (after taxes) to sustain yourself and your family. Then add in all your business expenses to that amount, remembering to factor in additional self-employment taxes that you did not have to bear as somebody else's employee. The final figure is the amount of revenue your business needs to take in before you can quit your part-time job.
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Please note: This is general information and is not intended to be legal advice. You should consult with your own financial advisor before making any major financial decisions, including investments or changes to your portfolio, and a qualified legal professional before executing any legal documents or taking any legal action. Harpo Productions, Inc., OWN: Oprah Winfrey Network, Discovery Communications LLC and their affiliated companies and entities are not responsible for any losses, damages or claims that may result from your financial or legal decisions.
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