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Fun silly thing. Ran a goon/GBS project to get shirts printed that made ~$800 total and will be giving all remaining profits to charity. How extensive do my records need to be for this to not cause me any issues this tax year? For the record it was run through Kickstarter and Amazon, with Amazon making me fill out a And, if it matters, no I didn't form a little shell entity/business just to make a shirt order for a bunch of goons.
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Sep 24, 2012 03:04
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You will have to report the $800 of revenue. I'm assuming you have some kind of printed record of whatever expenses you incurred? That would be sufficient. Keep in mind that if you don't itemize you'll be getting no benefit from whatever profits you gave to charity. Admiral101 fucked around with this message at 20:22 on Sep 24, 2012 |
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Sep 24, 2012 20:17
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Admiral101 posted:You will have to report the $800 of revenue. I'm assuming you have some kind of printed record of whatever expenses you incurred? That would be sufficient. I've been keeping a listing in a spreadsheet for expenses just to keep a running total of the funds so I know how much is left over, but also have receipts for supplies and shipping and an invoice from the printers. quote:Keep in mind that if you don't itemize you'll be getting no benefit from whatever profits you gave to charity. For some reason, I thought if I wrapped it up as an expense, showing the this little venture resulted in a zero-sum gain for me that would be enough. I'll keep records though and see what makes sense come tax time (not like I' not looking at a 1040 for this year, regardless). As always, thanks for the help taxgoon.
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Sep 24, 2012 21:24
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BirdOfPlay posted:I've been keeping a listing in a spreadsheet for expenses just to keep a running total of the funds so I know how much is left over, but also have receipts for supplies and shipping and an invoice from the printers. Also, you probably owe self-employment tax on the net profit. Should hopefully just be a few bucks if your gross receipts were only $800.
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Sep 25, 2012 01:35
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I'm reasonably sure I understand how these work, but just want to be sure before I write a big ol' check to TDAmeritrade... I'm self-employed and have already contributed $5000 to my traditional IRA (as I do every year). I just set up a SEP IRA in addition. I can contribute the maximum amount to both each year and deduct the full combined contribution, correct? Or is it one or the other?
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Sep 25, 2012 03:28
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JimTheSarcastic posted:I'm reasonably sure I understand how these work, but just want to be sure before I write a big ol' check to TDAmeritrade... The combined contribution limit is the same as your SEP IRA maximum. In other words, subtract $5,000 from whatever you figured your SEP contribution to be.
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Sep 25, 2012 05:57
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I have a question about qualifying for the Earned Income Credit. For the record I'm in Indiana, if that matters. At the beginning of this year I had to make an early withdrawal from my 401k, which after taxes amounted to about $6200. I will be filing as Married Filing Jointly. I made $38200/year until the beginning of this month, and I got a raise to $40000/year. My wife is a stay at home mom, and she is also a 50% disabled veteran, so she brings in roughly $11232/year on this. Actually I have two questions. 1. Does my wife's VA disability count towards the income requirements of the EIC? Everything I've read says probably not, but it seems to be difficult to find reliable information on the internet. 2. With my early withdrawal in the amount of $6200 from my 401k, does it count towards the investment income restriction of $3200 on the EIC? Everything I've read says that I won't qualify for the EIC based on this withdrawal, but I'd figure that I should ask. Thank you
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Sep 25, 2012 20:27
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How is the fair market value for shares of a private company determined during the execution of a stock option? My dad has a some options with an exercise price of $0.25, and during the most recent round of funding investors valued the stock at $1.50. This is a small, private company and he thinks he wouldn't be able to sell the stock for more than $0.75. So if he bought and immediately sold 100,000 shares, would this be the proper tax treatment? code:
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Sep 26, 2012 06:17
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If it is a "small private company" then I am sure the company has right of first refusal on the shares, and why wouldn't they pay the $1.50 FMV?
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Sep 26, 2012 15:49
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furushotakeru posted:If it is a "small private company" then I am sure the company has right of first refusal on the shares, and why wouldn't they pay the $1.50 FMV? I think you answered yourself right there. "Small private company."
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Sep 26, 2012 16:40
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AbbiTheDog posted:I think you answered yourself right there. Then why are they granting 100k options?
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Sep 26, 2012 16:45
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furushotakeru posted:Then why are they granting 100k options? Pay 'em with promises, not cash!
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Sep 26, 2012 16:53
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Risket posted:I have a question about qualifying for the Earned Income Credit. For the record I'm in Indiana, if that matters. Thank you
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Sep 27, 2012 14:55
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1. Your wife's VA disability benefits are not considered earned income for purposes of the EITC credit, if that's what you mean by "count towards the income requirements". 2. Early 401k withdrawals are not investment income. Therefore, that alone would not disqualify you from the EITC.
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Sep 27, 2012 15:26
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Admiral101 posted:1. Your wife's VA disability benefits are not considered earned income for purposes of the EITC credit, if that's what you mean by "count towards the income requirements". Thanks for the quick answer!
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Sep 27, 2012 21:47
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I started a little side business with a friend this summer, and all the sales are going to my personal paypal account. But now that we're starting to make real money, we're going to open up a new bank account for the business and run everything through there. We should have done this from the start, but we started really small. My question is, when I transfer the money from my personal paypal to the new bank account, how do I tell the IRS about it so it isn't seen as personal income? I expect to get a 1099 from paypal reporting around $40,000, and I will have dumped 100% of it into the business bank account.
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Oct 1, 2012 01:59
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ynotony posted:I started a little side business with a friend this summer, and all the sales are going to my personal paypal account. But now that we're starting to make real money, we're going to open up a new bank account for the business and run everything through there. We should have done this from the start, but we started really small. You'll also want to tell Paypal to issue your next year's 1099 to the business so that you won't have to worry about it next year 
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Oct 1, 2012 02:31
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scribe jones posted:Have you applied for an EIN for the business? If so, you'll file a Schedule C with $40k of income and a $40k expense for "Reported on EIN #XX-XXXXXX". That way you won't get a matching notice. Not sure he can retroactively apply income collected to a business that hasn't formed yet. I would be OK with this depending on the kind of new business that is formed. If it's an LLC or partnership, probably no big deal, since the taxation would probably be the same. A corporation (either C or S) I would not allow the client to do and make them file two returns. This late in the year not sure it would be worth doing a corporate filing since you'd probably pay more in annual fees/CPA fees to prepare the return than it was worth.
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Oct 1, 2012 16:48
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AbbiTheDog posted:Not sure he can retroactively apply income collected to a business that hasn't formed yet.
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Oct 1, 2012 17:56
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scribe jones posted:It sounds like they have an (implicit) partnership, formed when they agreed to do business together. The fact that they're only getting a business checking account/EIN now is irrelevant. I agree that it's a little different if they're electing sub-S status for 2012 but it doesn't sound like that's the case. Never underestimate the power of a taxpayer with the unlimited ability to form their own business online! "Yeah, I went ahead and formed that trust that I've elected to be taxed as a subchapter C partnership in the state of Wyvada. I did this about three years ago but was doing payroll under my social security number, is that going to be messing anything up? Oh, and I got this audit notice in the mail last fall. Was I supposed to do something with this? What does "levy" mean?"
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Oct 1, 2012 18:01
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Some years ago I purchased an ATV worth about $7500 at the time. Recently sold it for about $5000. I am clear on having to report anything regarding the sale to the IRS, since I made no profit, correct? Edit: Thought of one other quick tax question. My mother recently added my name to her bank account. There is more money in there than I make in a long time, is this something I need to consider? rally fucked around with this message at 16:33 on Oct 5, 2012 |
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Oct 5, 2012 16:29
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rally posted:Some years ago I purchased an ATV worth about $7500 at the time. Recently sold it for about $5000. I am clear on having to report anything regarding the sale to the IRS, since I made no profit, correct? ATV was entirely personal? There's nothing to report. Regarding your mother's bank account: probably not. Is your mother giving you a portion of the account or something? The only possible implication is gift return filing.
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Oct 5, 2012 17:46
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Admiral101 posted:ATV was entirely personal? There's nothing to report. She put me on the account so I could more easily handle her finances out here. She is moving in a few months and I am locking down the house, etc so it was convenient for my name to be on the checks basically. Also she just had a hell of a time getting her aunt's accounts settled when she died, and said it would be a lot easier for me when the time comes if my name is already on there. She did let me take $6000 out of the account for the private purchase of my current vehicle. Would I need to report that as a gift or what? I basically took a check, wrote it to myself at the bank, and took the guy selling me the car cash, at the direction of my mother. Car was registered in my name and I paid the property taxes out of the $6000.
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Oct 5, 2012 18:02
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rally posted:She did let me take $6000 out of the account for the private purchase of my current vehicle. Would I need to report that as a gift or what? I basically took a check, wrote it to myself at the bank, and took the guy selling me the car cash, at the direction of my mother. Car was registered in my name and I paid the property taxes out of the $6000. $6,000 is below the threshold so it can be ignored (and even if it wasn't below the threshold, you wouldn't be including it as income, but that's a different topic).
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Oct 5, 2012 18:41
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This may seem like a dumb question but I am planning on withdrawing $8000 from my Simple IRA to use as a downpayment for a mortgage. This is my first house so I am exempted from paying the 10% penalty. However, I still have to pay tax on the amount. What tax does this include exactly? Is it just Federal and Ohio income tax or does it include every other taxable line that I see on a paystub (Medicare, local, etc)? Would it be ok if I didn't withhold any tax right now and just paid what I owe when calculating my tax returns next year or is that considered a no-no?
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Oct 5, 2012 21:15
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Goetta posted:This may seem like a dumb question but I am planning on withdrawing $8000 from my Simple IRA to use as a downpayment for a mortgage. This is my first house so I am exempted from paying the 10% penalty. However, I still have to pay tax on the amount. What tax does this include exactly? Is it just Federal and Ohio income tax or does it include every other taxable line that I see on a paystub (Medicare, local, etc)? Would it be ok if I didn't withhold any tax right now and just paid what I owe when calculating my tax returns next year or is that considered a no-no? Just income taxes. You can choose to pay whatever is due later if your other withholding isn't sufficient to cover your tax. At worst you will face some minor underpayment penalties (assuming you have enough money to pay anything that is due that is).
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Oct 5, 2012 21:18
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Ok, great thanks that makes everything much simpler.
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Oct 5, 2012 21:27
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furushotakeru posted:Just income taxes. You can choose to pay whatever is due later if your other withholding isn't sufficient to cover your tax. At worst you will face some minor underpayment penalties (assuming you have enough money to pay anything that is due that is). If you buy the house this late in the year, you might not itemize this year and take the standard deduction anyways. If you're taking the standard, you'll get more tax savings by paying the state tax due in 2013 instead of 2012.
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Oct 5, 2012 21:45
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Goetta posted:Ok, great thanks that makes everything much simpler. Remember to exclude IRA basis when you report it on your Ohio return.
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Oct 5, 2012 22:51
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I've been self-publishing fiction online as my primary source of income, and I do well enough that I'm earning about what I would in a crummy part-time job. Pays rent, anyway. I've been publishing under my given name, but I'll be expanding into other pen-names for marketing/branding purposes. I live in Illinois. Should I register as a sole proprietorship? Do I have to file fictitious/assumed business names for my pen names? If I have several pen-names, should I instead create a small/indie publisher to umbrella them under? The income from these pen-names by and large comes from each e-retailer to my personal checking account. Should I open up a business account for this instead? Thanks for any advice.
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Oct 5, 2012 23:02
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I am married in the US but my wife is a Canadian citizen and resident. Is it possible for me to file as MFJ instead of MFS?
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Oct 8, 2012 10:30
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lampey posted:I am married in the US but my wife is a Canadian citizen and resident. Is it possible for me to file as MFJ instead of MFS? Yes, but it involves making an election to treat your wife as a US resident for tax purposes, meaning her income will be included on your return. It might still be beneficial though. Keep in mind that if you make this election is is irrevocable and you must treat your spouse as a US resident from then on, so make sure you understand what you are doing. furushotakeru fucked around with this message at 20:41 on Oct 8, 2012 |
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Oct 8, 2012 15:29
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I have a bunch of tax debt that I need to settle. I've been 1099 for 6 years and have only filed taxes a few of those years cause I am an idiot. The years I filed it was so hard to keep up with my payments that I would just skip the next year. During this time I paid down around 20k in credit card debt from college, which caused me to neglect saving for taxes. I am now debt free besides what I owe the IRS. Anyways, I really want to settle up my tax debt and start keeping up with my taxes cause I feel pretty ashamed. Who should I talk to about negotiating tax debt? I imagine it is something that I would have trouble doing on my own, but I'm not sure if I go to a CPA or some attorney or what. Thanks.
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Oct 8, 2012 18:51
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My wife is going to have orthodontic work done in 2013. Both of us work (separate employers) and both of us can participate in a pre-tax flex spending account for health care expenses. I know the Affordable Care Act changed the limits starting in 2013 to a $2500 maximum contribution. Can both my wife and I contribute the maximum to our respective accounts and use that $5K to pay for her orthodontic work?
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Oct 8, 2012 19:09
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Jewce posted:I have a bunch of tax debt that I need to settle. You have two issues. Before you look at settling, you need to catch up on your back taxes. After that, you can look into trying to settle/negotiate with the IRS. Depending on the amounts owing (30k+) I would suggest looking into a tax attorney first. If you don't owe that much (a tax attorney might run you $5k for work, NOT including filing back taxes) you can look into one of those local "I worked for the IRS and can help you negotiate with them." Do NOT call the national ads on daytime TV, they are a ripoff. Note that trying to negotiate with the IRS will probably result in no change to your account (vary rarely do those offers in compromise work). At this point you're trying more to work out a payment plan and stop them from garnishing your pay/bank accounts.
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Oct 8, 2012 19:36
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Abbi, now why would you do a silly thing like telling someone that they need a tax attorney when they probably do not? You or I or any other EA or CPA can represent a taxpayer before the IRS for collection matters. A tax attorney is only necessary if there are criminal charges involved or if they need to go to tax court. And an OIC is a perfectly valid option for many people, the issue becomes that the firms that advertise on TV and radio have a bad habit of submitting ones that have no chance of being acceptance just so they can charge the fee to prepare it. I have taken on clients that are refugees from some of these firms and the paperwork that gets submitted by some of them is beyond belief (that is when they actually bother to prepare something). Also, the most notorious law firm in this area charges more like $10-15K not $5K. It will vary by area though. furushotakeru fucked around with this message at 20:33 on Oct 8, 2012 |
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Oct 8, 2012 20:30
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PretzelAssassin posted:My wife is going to have orthodontic work done in 2013. Both of us work (separate employers) and both of us can participate in a pre-tax flex spending account for health care expenses. I know the Affordable Care Act changed the limits starting in 2013 to a $2500 maximum contribution. You should be able to do this, but check with your payroll departments to make sure. I do not think there should be any plans out there that won't reimburse for a spouse's expenses as well as you own.
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Oct 8, 2012 20:33
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furushotakeru posted:Abbi, now why would you do a silly thing like telling someone that they need a tax attorney when they probably do not? You or I or any other EA or CPA can represent a taxpayer before the IRS for collection matters. A tax attorney is only necessary if there are criminal charges involved or if they need to go to tax court. And an OIC is a perfectly valid option for many people, the issue becomes that the firms that advertise on TV and radio have a bad habit of submitting ones that have no chance of being acceptance just so they can charge the fee to prepare it. A) We can represent for collections, but I'm guessing it's more than just a collections matter. B) See his original post about not filing - I'm also guessing (OP can elaborate) that he might have made some good money in those years he hasn't filed. C) Or, worst case scenario, he's not reporting full income. I also know that tax preparers do not have "attorney/client" privilege but we can work as subcontractors under an attorney and have our work be protected. This would assist in that matter. The OIC, if he's making good money, would not be approved. He says he's "debt free" so there's no mortgage or car loans to consider. Also he's running into the statute of limitations for the old tax debts but not on the unfiled years. I just have a hunch it might be more than "not filing." But that's just me. He hasn't filed for years, but the IRS hasn't filed statutory returns for him? That seems unlikely if he was getting a decent 1099 from whomever was paying him. The IRS usually only gives you one-two years of not filing if you're 1099 before they say "gently caress it" and file a return for you, but he didn't mention that. Edit: I've gotten involved in far too many of what the client makes out to be "simple collection issues" to get a little gunshy about the big balance ones. AbbiTheDog fucked around with this message at 23:29 on Oct 8, 2012 |
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Oct 8, 2012 22:55
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Jewce posted:I have a bunch of tax debt that I need to settle. 2. You need to get your finances in order before you attempt to get an OIC. It's not that hard to get an OIC but it's hard for a lot of taxpayers to complete the program. An OIC isn't just giving the IRS a few cents on the dollar and then walking away free and clear. There are strings attached, including staying current on all of your filing obligations for a period of years after getting the OIC. People tend to fall back into bad habits, don't stay current, and then the OIC is void and all those negotiated savings disappear. There's a very large carrot-and-stick element to OICs.
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Oct 9, 2012 00:14
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My business is in desperate need of a resell tax exempt license. We're in the distribution business and haven't been asked for one until now. We need to get this ASAP. What's the quickest way of doing this? I see 20 business days quoted but I'm willing to go anywhere to get this poo poo done NOW. Any help would be greatly appreciated. By the way, I'm in Miami.
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Oct 9, 2012 03:08
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