There are a growing number of web sites, blog posts, and YouTube/Google videos that purport to be a scam exposé, repleat with warnings about how you can be ripped off, but they’re really ads for the product they’re reviewing. And those products really are scams!

The odd thing is they must work, because we’re seeing more and more of them.

For example you’ll find all kinds of web posts and videos claiming to scrutinize the Crazy Fox TV and web campaign as a potential scam. Unfortunately, they usually start with a full run down of all the money you can make, and the videos often include the commercial—all presented, of course, so you’ll know what the piece is about.

And if those kind of deceptions aren’t bad enough, there are many videos (titled as a scam reviews) of poor fools who are talking at a camera while they go about their daily lives—obviously following one of those free ‘how-to’ important business success tips offered in the package. We’re surprised we didn’t see one of a guy on the toilet, but it would have been appropriate. Of course they all end with a sales pitch, just call now—the promise of thousands of dollars if you too do the grunt work, just try hard enough, and make your own movie.

But if you look carefully at the websites, in fine print you’ll find these words:

The incomes depicted are not typical and represent a small percentage of actual participants. There are no guarantees that participants will be able to achieve the income levels depicted. Each individual’s success will be determined by his or her desire, dedication, effort, ability to follow directions and personal talent. The actual contents of the success kit may vary from what is depicted. (ed-Emphasis added)

So when in the middle of the website you read, “You do not have to give up your job for your home business, although if you set a goal of $500,000 a year, you might want to trade in your job for your home based business, it’s your choice. That’d be crazy wouldn’t it?” You have to answer, “Well, yeah, duh!”

Still, these low-lifes apparently manage to bilk enough people for a minimum of $9.95 for the “free” home business training package (that’s just for postage, of course) to make the TV ads pay for their partner, REVSHARE, but you still have to give them your name, address, and email address (I used their company’s own email). Then they tell you, “After you package arrives, quickly review the information and contact your personal business coach.” Right, and because you’ve already proved that your willing to be hornswagled, they’ll try to talk you into spending even more money.

Doing what, you ask? Selling HerbaLife through network marketing, for crying out loud. Yup it’s a scam.

Telecommuters are being taxed by states where they don’t live, vote or use schools, libraries, fire departments and other services. That’s because their employers are based in states that assess income tax on nonresident employees, regardless of how often they visit the office.

States are waking up to the idea that nonresident telecommuters are an untapped revenue stream. This can be a nightmare for peope who work from home.

Courts have upheld this treatment of nonresident telecommuters, at least in New York. And other states are jumping on the bandwagon thanks to New York State’s success.

The rule is that if employees of a New York company are required to work outside the state as a job requirement, they’re subject to income tax only for those days that they work in New York. But if the same workers choose to work outside New York for their own convenience, they’re subject to income tax on they’re full income—unless the workers never work in New York during the tax year, then the taxman makes an exception.

Congress has sopme bill pending to address this. But they completed their last session without taking up the Telecommuter Tax Fairness Act which would require states to apply income taxes to nonresidents only for the days they show up in the office, preventing the double tax.

Moral of the story? Until Congress straightens this out, and because telecommuting is unquestionably good for your employer, get a letter that says you’re working from home for their benefit.

If you’re thinking of working as a home-based freelancer or you operate a home-based business, here’s a question you’ll eventually ask yourself: Should I incorporate or remain a sole proprietor?

Well, the primary reason that most small businesses incorporate is to protect the owner(s) from personal liability that might arise from business practices. Let’s say you’re making gift baskets and a customer’s 8 year old drinks the wine it. (Don’t laugh, it can happen.) Good chance you and your business will be sued. If however, you have operated as a corporation, your personal assets should be safe.

If you’re in a business that isn’t a breeding ground for lawsuits, or if you really don’t have much in the way of personal assets that need protecting, you may find the complications of a corporate form outweigh the benefits.

Other factors that weigh on the decision of business form include: taxation, cost, and paperwork.

Here’s some basics about the various business forms.

A sole proprietorship is the most common and easiest business structure. There is no significant cost to start or maintain a sole proprietorship. Paperwork hassles are minimal. And your profits are treated as personal income and filed on your regular personal tax return. On the downside, the owner is fully liable for the actions of the sole proprietorship.

A partnership, which involves two or more people, is more costly to start (since legal documents are involved) and requires more paperwork than a sole proprietorship. Your share of the profits pass through to your personal tax returns just like in a sole proprietorhship. And, unless it’s a limited partnership, you are personally liable for the business of the partnership.

A corporation is a legal entity that is created to conduct business. When properly managed, the corporation is considered separate from those who run it. The cost of forming a corporation ranges from a couple of hundred dollars to thousands of dollars, depending on what State you live in (or incorporate in) and how complex the structure is. S Corporations (short for Subchapter S), a “light” version of the regular corporation, are typically a better bet for small businesses because they avoid double taxation. Instead of paying taxes at the corporate level, and then again at the personal level, the profit of an S Corporation passes through to the owner’s personal taxes. The paperwork involved in properly maintaining a corporation is significant but not insurmountable once you get the hang of it. Producing corporate (as well as personal tax returns) will cost you in accounting fees as well. Your State government will get it’s share of the wealth too. Most states have annual corporate fees, and some are even structured as a percentage of income so be sure to check with your Secretary of State before you make the switch. All told, you can probably figure on paying between $1,000 to $4,000 annually to maintain a simple S corporation.

Finally, a limited liability company (LLC), allows its owners to take advantage of the benefits of both the corporation and partnership form. Profits and losses are taxed at the personal level and the owners are shielded from personal liability.

One final related thought: if your doing your own taxes, you might think about turning that task over to an accountant. Not only can an accountant (not a tax prep company) help you find deductions you might be missing, they also may be able to keep Uncle Sam off your back. Indeed we worked with one that knew his way around because he was a former IRS agent. (His first question to us was, “Do you want to eat well or sleep well?”)

What’s the big deal? Sole proprietorships are the most commonly audited form of business. And owner-prepared returns are audited more than others. Even if you’re doing everything right, audits are costly and time-consuming. A CPA’s signature on your returns is a good insurance policy.