11 August 2009

Taxes? Who, me?

Yes, you. You are a self-employed business owner, are you not? Chances are....if your business makes a red cent, you have to at least file your taxes. That doesn't mean you'll owe, but you do need to file. You'll also be made aware of self-employment tax. Yeah, you'll probably have to pay that too. But, don't worry, the IRS is busy making it extraordinarily impossible to figure out on your own. Chances are good you'll seek some outside help. Whether an accountant friend, a tax preparer - and please folks, seek a reputable one - or the IRS itself, unless you love long and wordy forms, clicking multiple links, and following trails of breadcrumbs....ask for help. There is a great source of info in this thread , but WOWZA - see what I mean about all those links?? And, that's just the Federal stuff.

Depending on the state you live in, you may have to pay not only sales tax you've collected (and you HAVE been collecting it, right?? If not, well...tsk tsk and run along to your state's .gov and set yourself up to collect it! No, really!!), but you'll also likely need to pay income tax too (unless you live in a state that has no income tax, of course). I live in MA - which is apparently a tax-loving state. I really pity the folks who work in MA, pay our income tax then skibble up to NH where they live, and pay their whopping real estate tax - but I truly digress. I just see so many of these people packing 93N every day to get to their highly taxed homes.

Finally, please keep records of EVERYthing. I keep spreadsheets of all expenses and earnings as well as all receipts/invoices to back them up. I have it broken down and separated all pretty-like by tax quarters. You really don't need fancy accounting software - excel will do. It's especially helpful if you're a whiz at excel's math formulas! In any case - even if you use the ole' ledger and pencil - keep records. It'll save you one big fat headache.

**Um, ok, judging by my post, I hope you can plainly see that I'm no tax expert. Please seek professional advice if you have questions!**

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