Taxes - How Do You All handle Them ?

[Mojo]

I am just coming off an explosive month, probably one of the best I have ever had since I started in this business. The numbers are astounding but that leads me to this question.  T A X E S....

I do not handle the money or the books, that is my wife's job and thankfully she is very good at it. First off let me say that the business is a sole LLC. We have always been able to show a loss using write offs but it appears this year we wont be able to. So she is squirelling away money in a savings account. When I asked her about why there was this money hidden away she said " to pay taxes at the end of the year because - We will be paying ".

I should first say that this is NOT sales tax that I am talking about. This is schedule C / personal tax. So my question is do you guys and gals put a percentage of each sale away to pay taxes or do you just wait till the end of the year and pay whatever tax you owe ? Do you work off a percentage to bank tax money ?

I can see why she does what she does as we are now heading into the " Dead Zone ". This time of year is where the previous few months carry us through the lean summer months.

Thanks,

Chris

[baileyuph]

Chris get with your wife and find out under what conditions you will be required to pay taxes every quarter.

The Feds are smart, if it is so much, they aren't going to let you work off their money.

The short answer is I pay every quarter, several thousand and it is more than some live off. 

Doyle

[bobbin]

I pay on time.  I pay quarterly. 

There is a worksheet to fill out and your wife should be well able to deal with it.  My greatest concern has been making sure I have the quarterly "nut" while still having enough liquid capital to permit the acquisition of necessary supplies without draining my reserves entirely. 

[Mojo]

Bobbin. That is the one thing I am very careful of. I try and always keep $ 2 K in the bank strictly for ordering supplies. I panic if the bank account drops below that number.

One roll of acrylic is about $ 800. A spool of Solarfix is $ 200. It doesn't take long to wipe out your bank account with a few orders. I also do not take deposits so I have to have that cash up frontat all times to pay for materials.

Do most of you have LLC's ??? Inc's ?? Sub S Corps ?

Chris

[Mike]

LLC quarterly and its all in the general fund.  you mentioned sales tax
chris id assume you don't have much as I belive any sale out of state are nit taxed unless its a florida resident right?
at least I was doing a few out of states sale  no tax

[Mojo]

LLC quarterly and its all in the general fund.  you mentioned sales tax
chris id assume you don't have much as I belive any sale out of state are nit taxed unless its a florida resident right?
at least I was doing a few out of states sale  no tax

Yes for now. Unless Congress does something with the internet tax free thing.

Even Florida people have me bill them at their out of state addresses. These old people are pretty clever in how they conduct business. They know if they contact me via internet and use their home address out of State they are not subject to sales tax.

In regards to locals, most of them are done through a local dealer and they charge the sales tax.

Chris

[Mike]

that's 1 headache your wife dosent have to deal with.
coming from new Hampshire I never had to deal with sales tax till I got here

[bobbin]

LLC.

I pay sales tax (collected from customers), "use" tax (on supplies/tools I buy for my shop), and service provider tax (tax on my labor) for new fabrication work (but not on repair labor).

It was pretty confusing in the beginning but I worked with a good book keeper and spoke with the revenue service in my state to get the complete "skinny".  Now that it's all set up it's no big deal to handle on a quarterly basis.   

[Mike]

service provider tax (tax on my labor) for new fabrication work (but not on repair labor.  

that's something ive always though about repairs even a restitch there is new thread provided

[JuneC]

I collect and pay sales tax religiously.  As for federal stuff, I just take it all as salary and pay payroll taxes on it.  Why pay corporate taxes then also pay payroll tax later?  My corp exists for one purpose only - to pay me a salary.  So I drain it at the end of every year and pay my payroll taxes and be done with it.  Now,  if I were saving to expand, that would be (might be) different.  Kinda nice that Florida permits $25K in profits before it expects part of your (corporate) earnings.  That might be a game-changer.  I haven't really thought about it much yet.

June

[Mojo]

June:

Florida just upped it to $ 50 K.

Chris