But they’re not the same, and knowing the differences between these two cards — as well as the pros and cons of each — can keep your bank accounts intact, your credit rating strong, and your purchases hassle-free.

In general terms, a debit card is like a blank check. When you swipe a debit card through an electronic card reader, you’re filling in the payee line. The merchant verifies that you have enough money in your bank account to cover the purchase. If you do, the transaction is approved and the money is deducted — right then and there — from your account. A credit card, on the other hand, is a promise to pay. The store only checks to see that your credit line hasn’t been exceeded. The transaction is added to your account and at the end of the month you only have to cover a minimum payment.

Debit cards can be a great tool. Like credit cards, they’re convenient. Your wallet doesn’t bulge with paper currency and swiping a card is faster than writing a check. You can even save a trip to the ATM machine by using the card’s cash-back feature. With a debit card you’re only spending money that’s actually in your checking or savings account, so you’re forced to budget. No money, no purchase. Another big advantage: no interest or late fees.

On the other hand, debit cards have some distinct disadvantages. If you don’t use a credit card, even stellar spending habits won’t bolster your credit score. And debit cards may not offer the same level of protection as credit cards. If your debit card is lost or stolen, your maximum liability may be greater. (Check with your financial institution to learn their particular policies.) Another thing, with a credit card you can withhold payment if you’re dissatisfied with a purchase. Purchase with a debit card and the store already has your money. You have less leverage. Are both types of card in your wallet? Use them, but watch out for hazards.

Inventory – Manufacturing Tax Tips
How do I value my inventory?

Excise Taxes – Manufacturing Tax Tips
Manufacturing Companies may be liable for Federal excise taxes or due a credit or refund.

Research and Development – Manufacturing Tax Tips
Can you deduct R&D expenditures as a current business expense?

The expenditures of research and development (“R&D”) are generally capital expenses. However, you can choose to deduct these expenditures as current business expenses.

You may use one of the two following methods of accounting for R&D expenditures:

• You may deduct your R&D expenditures in the tax year, in which you paid or incurred,
  or
• You may amortize such expenditures over a period of not less than 60 months

You must charge to a capital account any R&D expenditures that you do not deduct currently, nor defer and amortize.

You may claim the R&D credit against tax for certain qualified R&D expenditures, and combine the credit as one of the components of the general business credit. The R&D credit is a nonrefundable tax credit.

For detail information of R&D expenditures, please select from the following topics:

Current-year Deduction of R&D Expenditures

Amortization of R&D Expenditures