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Sosa

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#1

Tax / Accounting question

06-11-2004, 10:41 AM

Ok got a few questions here if anyone can answer or give me any input. First off I'm single and of course self employed so my taxes suck ass. I just got done talking to my accountant which said I'm gonna have to pay in like 40% of my net income after my deductions for this year if I keep my sales where I am right now. Says I can save $3500 or so off that if I s-corp and pay a lawyer $1000 or so to do that.

I can also go buy a new vehicle and write off like 75% of it and save money on taxes that way and just pay to tax/license it here in Nebraska which fucking sucks ass ($2500 for every $25000 or so spend)

Do I just go buy a new tahoe/danali/escalade and s-corp?
Or S-corp and pay whatever taxes are left.

What would you guys do?
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genomega

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#2

06-11-2004, 10:53 AM

Your accountant is correct.

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Sosa

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#3

06-11-2004, 10:59 AM

Originally posted by genomega
Your accountant is correct.

Well I would hope he was correct, now what option would you go with?

I already have a 00 Escalade so I really don't need a new one. But if I'm spending money I might as well get something out of it and not just send it to the gov.

DO I just buy it and resell it?
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Elli

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#4

06-11-2004, 11:00 AM

Originally posted by Sosa
Well I would hope he was correct, now what option would you go with?

I already have a 00 Escalade so I really don't need a new one. But if I'm spending money I might as well get something out of it and not just send it to the gov.

DO I just buy it and resell it?

I've heard it's better to lease a business car...

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ace0r

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#5

06-11-2004, 11:03 AM

Originally posted by Elli
I've heard it's better to lease a business car...

Not if he's planning on using the accelerated depreciation loop for a gas guzzler. He can actually claim more than the 75% as long as the SUV's gross is 6000 lbs.

Go for a new SUV, sell the caddy
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Carlito

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#6

06-11-2004, 11:08 AM

Originally posted by Elli
I've heard it's better to lease a business car...

Yeah, lease a limo or something, can't hurt right?
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Carlito

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#7

06-11-2004, 11:10 AM

Originally posted by Carlito
Yeah, lease a limo or something, can't hurt right?

btw, this is exactly why companies run their exec's around in leer jets, limos, and helicopters.
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Sosa

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#8

06-11-2004, 11:10 AM

Right, I was looking a new SUV for sure if I was to go that way.
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#9

06-11-2004, 11:16 AM

Look into the massive tax free and tax deferred retirement investment options you have - set up a corp or llc and and you can put a big old chunk into investment accounts.

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Sosa

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#10

06-11-2004, 11:18 AM

Originally posted by gornyhuy
Look into the massive tax free and tax deferred retirement investment options you have - set up a corp or llc and and you can put a big old chunk into investment accounts.

I plan on doing a s-corp for sure. LLC won't happen because I'm the only worker and my accountant said there had to be 2 people involved for that?

The retirement thing is something to think about also, I have nothing like that started. Any webpages I can read about that?
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SexxxyChat-T

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#11

06-11-2004, 11:40 AM

Originally posted by Sosa
I plan on doing a s-corp for sure. LLC won't happen because I'm the only worker and my accountant said there had to be 2 people involved for that?

The retirement thing is something to think about also, I have nothing like that started. Any webpages I can read about that?

If you file in Nevada you can have a 1 person LLC, so it depends on the State you file in, I think most States allow 1 person LLC's now.

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cool1g

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#12

06-11-2004, 12:02 PM

well you are only supposed to be able to take that SUV tax deduction if you work in an industry where you need transportation - i.e. real estate.

if you every got audited i don't think webmaster would cut it...i'd check with your accountant on that...

the good thing about being incorporated is that if you make say, $100K this year, you pay yourself $40K salary....the $60K remaining you pay as a dividend...and therefore you don't have to pay the 9% social security/unemployment tax BS on the $60K - that adds up and more than pays for the incorporation costs...

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Lighter

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#13

06-11-2004, 12:15 PM

another reason to do find a good offhsore incorporation company
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Sosa

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#14

06-11-2004, 12:28 PM

Originally posted by cool1g
well you are only supposed to be able to take that SUV tax deduction if you work in an industry where you need transportation - i.e. real estate.

if you every got audited i don't think webmaster would cut it...i'd check with your accountant on that...

the good thing about being incorporated is that if you make say, $100K this year, you pay yourself $40K salary....the $60K remaining you pay as a dividend...and therefore you don't have to pay the 9% social security/unemployment tax BS on the $60K - that adds up and more than pays for the incorporation costs...

I have other business projects then just webmaster. I travel quite a bit for the others.
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collegeclam

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#15

06-11-2004, 12:32 PM

You become an S-Corp by filing form 2553 within 75 days of incorporation. whether or not you need to pay a lawyer anything to fill in forms for you, is up to you. a lot of accountants and lawyers make a killing by charging retards an obscene amount of money for filling out a simple form you can download from irs.gov and submit yourself. perfect example: an ss-4 form used to apply for an employer id number aka tax id.

If you write off a vehicle, it must be over a particular weight and used strictly for transporting stuff crucial to work...real estate people get away with this because they carry "for sale" signs.

leasing a company car, thats probably different.

the IRS treats a single member llc as a sole proprietor, unless that single person llc has employees. in that case, the single member llc will need to file a 940 and 941. and if that person has agricultural employees, they file a 943.
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collegeclam

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#16

06-11-2004, 12:35 PM

Originally posted by Sosa
I plan on doing a s-corp for sure. LLC won't happen because I'm the only worker and my accountant said there had to be 2 people involved for that?

The retirement thing is something to think about also, I have nothing like that started. Any webpages I can read about that?

your accountant is 100% wrong. it doesnt matter what state youre in if you want a single member llc. taxwise: multimember llcs are treated as partnerships; single member llc (without employees) treated as sole proprietors.

get a new accountant, because yours is obviously not up to date with the current irs news.
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Sosa

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#17

06-11-2004, 12:44 PM

Originally posted by collegeclam
your accountant is 100% wrong. it doesnt matter what state youre in if you want a single member llc. taxwise: multimember llcs are treated as partnerships; single member llc (without employees) treated as sole proprietors.

get a new accountant, because yours is obviously not up to date with the current irs news.

Thx for that info, I should go talk with another accountant about this and see what they say and what numbers they come up with.
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Sosa

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#18

06-11-2004, 12:47 PM

collegeclam, you happen to have any IM programs that I could chat with you on?
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Sosa

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#19

06-11-2004, 01:32 PM

anyone else have any input? Maybe KRL?
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