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boneprone

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#1

Tax Question

01-11-2001, 08:03 PM

As most of you know, I am a free site, that gets much of my revenue from programs like Amateurpages, and several other programs.

Checks are send monthly, and I have been doing alright to say the least, but Im not sure if I am doing this right..

I have been saving all my stubs, saving all my expense recipts for webhosting, content, software, hardware, and everything else like I should..

But I am not incorporated. I am a one man army, and all the checks I recieve are to me and my personal account, and the expenses are all out of my own personal account also.

I do this full time, but wonder if it would be in my best intrest to incorporate? Am I doing anything wrong by doing what I have been doing, and what is the advantage of incorporating? Like I said do I really need to being I am the only employee of this soon to be company?

Also, friends of mine have been telling me to incorporate in Nevada.. I live in Oregon, but I have been told I can incorporate in Nevada even if I dont live there.. Advantage being state tax, and looser tax laws.. Anyone heard of this? Is it a good option?

Serious replies will be appreciated!
Believe it or not I have a masters degree in Health Care Administration and I cant even spell or figure out my taxes. Schools just arent what they used to be!! OSU BEAVER!

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XxCrackNuggetxX

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#2

01-11-2001, 08:41 PM

I Apologize Man But I Dont Know Anything About Taxes But Ill Try 2 Find Out 4 You
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#3

01-11-2001, 09:12 PM

Well, you're doing good by keeping reciepts and bills. Here's what'll happen. All companies that paid you (at least $600) will send you a form called a 1099. You're legally an independent contractor. You'll use all of thes 1099 and other sources of income to calculate your taxes. Also there's a fee for being an independent contractor. If you're doing VERY well, they you should be filling taxes quaterly. Uncle Sam caught me by surprise last year. I earned too much during the last quater. Well you can never earn too much.

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Lensman

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#4

01-11-2001, 10:46 PM

Incorporating has few advantages. A Sub S corporation flows the income to you, otherwise a C corporation has to pay taxes on any profits after paying you. It's easier to write off (legit) expenses if you have a corp and there corporations generally sheild you from personal liability as long as you follow some basic formalities.

With a corporation, you have extra paperwork. It's probably not worth it for a one-man team.
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boneprone

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#5

01-12-2001, 03:19 PM

hmm.. For me it sounds like (at least for this year) I will stay as an indpendent contractor.. If I incoporate, from what I understand cash for my own personal useage would be restricted, and I would end up becoming an independt contractor for my own compnay anyhow If I incoporated.

Thanks for the help!

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#6

01-13-2001, 01:12 AM

What if a company doesn't send you a 1099?
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boneprone

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#7

01-13-2001, 01:43 AM

good question! What if a company doesnt send a 1099? Do most of the compnaies like ICS, Shaw, Vivid, Top Cash give 1099's?

I dont think my dialer compnay in Canada does? WTF?

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basschick

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#8

01-13-2001, 05:25 AM

if a company doesn't send you a 1099, you still have to report your income from them. we go through this... some companies pay us from out of the u.s.

you can try to do it yourself - it requires another form for each company that you are declaring - or pay someone to do it.

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#9

01-13-2001, 09:17 PM

If a company does not send you a 1099 my the end of Feb you can call them or the IRS. They must send if it is over $600 (could be $500 - not sure) Either way the companys that paid you less than that will not send one. So you will use your pay stubs as proof of payment and the IRS calculations will help to figure out the taxes owed to you from that

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#10

01-14-2001, 08:26 AM

boneprone, my advice would be to talk to a CPA. They will look at where you're at with earnings and can advise you when it will be to your advantage to incorporate (if at all) I say a CPA rather than just an accountant because if you're audited, IRS won't talk to just an accountant.

On a broader scale, far too many young people in this industry see the earnings as free money. Trust me, that ain't the case. Uncle does monitor adult sites and expects to see the earnings show up. Cover your butt.
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#11

01-17-2001, 12:43 PM

I fill out a Form C and a Schedule SE self-employment at tax time. This isn't my full-time job, so I don't have a lot of profit or the need to make quarterly tax payments (the tax I pay at my regular job cancels out the tax I owe for my porn checks usually).

If you are making a good deal of money, you should be making quarterly estimated tax payments to the IRS. If you owe too much at the end of the year, you will have to pay a penalty. If you aren't good with tax forms, go to H.R. Block or someplace and pay them $100 to do them for you. I prefer to do my own...it only takes about an hour.

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GARY LIVES

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#12

09-30-2001, 09:09 PM

the great bone the one man team can't even figure out taxes??????????
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Rocky

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#13

09-30-2001, 09:23 PM

hey boneprone

i know the tax systems are different here in Canada, but i think that maybe you should seriously consider incorporating

there are numerous reasons for doing so and i suggest that you get a book on the subject and see for yourself if you will benefit

it does require more paperwork over the course of the year but it's worth it in the end

you will also find that banks, creditors, companies and others will give you more leeway regarding financing and other matters

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quiet

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#14

09-30-2001, 10:46 PM

lol

we'll miss you our friend. RIP
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#15

09-30-2001, 11:32 PM

Do US based sponsors send 1090's or whatever there called if you live in canada or any other country other then US?
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#16

09-30-2001, 11:58 PM

no they don't Royaltee_Gee

it becomes your own responsibility to supply the Canada Customs And Revenue Agency with your own details regarding money earned from sponsors

that is why you need to keep all of your sponsor check stubs on file (they also can cross reference the amount from your deposit book)

the other good thing about incorporating is that you can give yourself a directors fee rather than be on the payroll of your company

this enables you to give yourself income based on amount earned rather than a fixed salary and you don't have to produce a T4 slip for personal taxes

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#17

10-01-2001, 12:03 AM

Ahh i see.

I didnt think they did, kind of makes it more confusing for us though
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#18

10-01-2001, 12:15 AM

Same thing if you operate a pay site. Ibill doesn't send anything to the Canadian govt - you are responsible to declare all income.

Incorporation is a pain. Two advantages are limited liability, as well as having more capital on hand for expansion and business expenses (since cash in the corporation is taxed at a lower rate than personal income).

we'll miss you our friend. RIP
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#19

10-01-2001, 01:35 AM

Originally posted by boneprone:
. Schools just arent what they used to be!! OSU BEAVER!

OSU Beaver? What the hell?

What university are you reffering to?

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#20

10-01-2001, 01:36 AM

I plan to file as an independant contractor for as long as I possibly can. Course, this year, I may have to break down and pay an accountant to get it all right. But if I'm lucky, I can wait till next year. If I were you boney, I'd do the independant contractor thang.

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#21

10-01-2001, 02:21 AM

OSU

Overweight Skanks University

Wow, Bone reading this i was like huh? Serious nature what the ^%$&*^%?

Great Post though, Alot of people need this kind of info

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tenletters

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#22

10-01-2001, 02:31 AM

You people, of course, know that you're posting to a thread that is ten months old?!?

Just checking.

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#23

10-01-2001, 02:33 AM

a good topic never dies!

love,

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tenletters

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#24

10-01-2001, 02:39 AM

Yea, but neither does herpes so, go figure...

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titmowse

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#25

10-01-2001, 02:46 AM

I think boney's nuts itch!

love,

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#26

10-01-2001, 06:29 AM

What if I don't pay any tax? Can IRS find out?

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tenletters

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#27

10-01-2001, 06:52 AM

Well, Singer...we've tracked you down to California... now we just have to figure out if you are John, or Michael.

Your friendly IRS worker.

Originally posted by Singer:
What if I don't pay any tax? Can IRS find out?

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Amputate Your Head

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#28

10-01-2001, 09:29 AM

Originally posted by boneprone:
I do this full time, but wonder if it would be in my best intrest to incorporate?

I personally wouldn't worry about incorporating boneprone. I've been incorporated before, and it's more paperwork and hassle that it's worth for a small one man operation like you said you have there. I would recommend you maintain it as a sole proprietership, and even later on, if you take on additional manpower, you can always 1099 them at tax time. That's what I'm doing and it works out pretty well, because then they are responsible for their own taxes, insurance, etc... and you don't have to maintain all the insurances, like Workers Compensation and such.

Just my .02 cents worth. Good luck with your endeavor!

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#29

10-01-2001, 11:34 AM

in this business you should never just have a sole proprietorship,,,

just in case you need to seperate yourself from your work,,,, you don't want anyone to seize your personal assest and shit,,

best an easiest way to do is to form an LLC
easier than INC because its less paper work,,
but you do have an advantage of seperating your personal assest to your company assest...

in georgia it cost me less than $100.00 to form a LLC,,

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#30

10-01-2001, 02:12 PM

I say fuck the estimated tax payments -- the penalty is so small I say it's not even worth sending them all that cash and wasting all that time doing impossible calculations and estimations that are based on our completely random incomes... I could be wrong though...

Well I'm making little tiny $100 payments to the IRS but I owe them a big chunk of money -- supposedly I'm supposed to be able to pay my 2001 tax on time -- otherwise my $100 payment plan for 2000 is null and void -- yeah right... We'll see what happens...

Meanwhile I heard some people at Internext saying they pay next to nothing in tax because they figured out a way to write off damn near every dime they spend... and this has something to do w/ incorporating... but I don't know how they are doing this... Seems like if you have enough money you can afford to know all the little secrets on how to avoid paying taxes...

Also I heard it's better to lease a car instead of buying one -- because the lease payments are tax deductible but not loan payments... Christ I wish I knew that before I bought my car...

Anyway I'm just rambling now...

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playa

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#31

10-01-2001, 02:43 PM

ya all my expenses for the internext trip will we be written off

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Amputate Your Head

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#32

10-01-2001, 02:48 PM

Originally posted by TheFLY:
...pay next to nothing in tax because they figured out a way to write off damn near every dime they spend... and this has something to do w/ incorporating...

Doesn't have anything to do with incorporating. I write off everything every single year and I operate as a sole proprietor. There's no big secret to it... just take your taxes down to H&R Block at tax time and start writing stuff off. It's done all the time, it's not illegal, and any tax accountant worthy of the title will tell you this.

[This message has been edited by Amputate Your Head (edited 10-01-2001).]

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