Working from home has its pluses-taking calls in your pajamas, being just a few steps away from the kids, not having to use the company bathroom and being your own boss. When it comes to managing finances, however, many home-based business owners find themselves at a disadvantage compared to office-based peers with accounting and human resource departments standing behind them.

Being financially savvy in a home-based business is manageable, says Lisa Bradley, tax manager at Bradenton's CPA Associates. She offers five money-saving suggestions:

STAY ORGANIZED

The IRS expects you to. Bradley advises home-based business owners to keep all receipts, checks, bank statements and invoices for up to seven years. She suggests keeping file folders for each month with all the invoices and receipts for that month inside. Track business expenses; that new office chair or computer software can help reduce tax payments. She also recommends using an accounting program such as QuickBooks, which can do invoices, billings, accounts payable, reconcile bank statements and produce profit-and-loss statements.

DOCUMENT CAR AND HOME USE

Your car and your home could help you save big bucks. Document your automobile usage either by standard mileage rate method or the actual expense method. With standard mileage, you can claim 40.5 cents a mile for 2005, and count tolls and business parking fees in addition. With the actual expense method, you calculate the depreciation of your vehicle, and use a log of business and personal miles to prorate for business. Also, if you use a portion of your home exclusively and regularly as the principal place of business to meet clients and tend to administrative activities, you can depreciate the square footage and also take a portion of the utilities, maintenance and depreciation to claim a deduction. Telecommuters may be able to deduct for things such as office supplies even if they don't meet the requirements for a real home-office deduction.

GET PROFESSIONAL HELP

Find a good insurance agent and get a good professional liability policy. For people who have employees, Bradley suggests signing up with an employee leasing company, which can handle issues such as payroll taxes and workers' compensation insurance.

PAY UNCLE SAM QUARTERLY

If you're no longer getting federal taxes withheld by your employer, you are subject to a 15.3 percent self-employment tax, says Bradley. She recommends that home-based business owners pay 100 to 110 percent of the previous year's tax, and says it is important to make even quarterly payments to have a safe harbor come tax day. Even if you made a smaller profit than the previous year, she still recommends paying 100 to 110 percent in case of a large last-minute sale. Download form 1040-ES from www.irs.gov for the appropriate paperwork.

HEALTH AND RETIREMENT

Retirement is another financial field usually handled by an employer that a home-based business owner has to do solo. Simplified Employee Pension (SEP) plans are a good option; they are like IRAs for businesses, says Bradley. Business owners can make deferrals under these plans and a 3 percent match that is deductible for both owner and employee. She also recommends HSAs, or Health Savings Accounts, which operate like medical IRAs. These have lower premiums and are a tax deduction; any unused money accumulates in the account and can be withdrawn tax-free after retirement.

HOW TO GET STARTED

American Association of Home-Based Businesses (AAHBB) Supports, educates and promotes home-based businesses. www.jbsba.com/content/suites

SBA Small Business Administration Basic how-to information and sources for starting a new business. www.sba.gov

SBA Online Library Contains 2,500 downloadable programs such as accounting software, business plan software and publishing tools, all for small businesses. www.sba.gov/library/sharewareroom

At-HomeWorks.com Online guide and resource for starting a home-based business, including a listing of telecommuting jobs. www.at-homeworks.com

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