We can think of many great reasons for becoming an IBO – and many wonderful benefits to talk about with Prospects who are considering building their own Independent Businesses powered by Amway. Our Best Practices specify that while we can share many benefits as motivation for becoming IBOs, we cannot encourage people to start their own businesses purely for tax benefits.
The Amway IBO Compensation Plan (“Plan”) offers a great opportunity to make money, own a business, meet new people, and use and sell high quality products. The Plan is not meant to be a source of tax benefits or relief, and it should not be confused with unscrupulous tax avoidance promotions. It is a violation of the IBO Rules of Conduct (Rule 5.4.4) to promote tax benefits to Prospects as a principal reason for becoming an IBO.
While there are provisions in tax laws that assist small business owners, no one should encourage a Prospect to start an Amway™ Independent Business in order to be able to deduct various personal living and travel expenses from their income. The tax laws are in place to help those who operate their businesses with the honest objective of earning a profit – not as tax shelters. In those cases, and with proper record-keeping, IBOs can deduct most ordinary and necessary expenses incurred in the operation of their businesses. The IBOAI®† website contains some resources that IBOs may find helpful in this connection. However, you should consult a qualified tax advisor (preferably a CPA/CGA) for specific guidance about your personal situation.
Please feel free to contact us if you have any questions.