You have to keep receipts (sm)
Posted By: Peanuts on 2005-09-11
In Reply to: To clarify: 6-8 CPL with NO BENIES, PAYING 40% in taxes IS a ripoff - .
Keep receipts of everything, write off 40% use of your home for business. You can write off up to 60% use of your home for business. And when you report your business receipts, write off everything you can! Write off 40% of your rent or mortgage interest. Write off 40% of your utility bills, Sparkletts water. Write off your internet service. Get the Turbo Tax and do it yourself. If you use a tax man they may not get everything and you'll end up paying a fortune in taxes!
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I'll believe that when I see your receipts.
$
See my receipts? you think I make more
I don't. I know you guys like to dream big and think there's more money, but there's not. Like I said, a hospital I know of was doing clinic work for doctors affiliated with the hospital for 18 cpl and the doctors would not pay that much anymore and found other services who would do it for less.
You people who think there is more money in this business these days are dreaming.
I use debit cards and keep the receipts on the
desk until the item has cleared the bank. I check the accounts online EVERY morning and balance each while I am waiting for DQS to load. Once a check or debit clears I toss it.
This way mistakes (mine or others') can be caught before they become disasters, any by knowing exactly what the balance is I know what I can afford to spend that day.
One thing also - keep all your receipts of any business related expenses
I have a folder and everytime I buy anything related to work whether it be a pen, a printer ribbon, a book, a keyboard, etc. I put in that folder. Those things add up and they are all deductible which comes off of your gross. This is in addition to the home use of your office. A statutory IC is a great way to go because you don't have to pay the entire social security but you are still IC and can utilize the business deductions. If you pay your own health insurance and it is in your name that is also deductible. Keep good records...this is the most important I have learned being an IC. Also you will probably have to file quarterly if you make over a certain amount. If you don't you will be penalized by IRS and have to pay the penalty fee with your April 15th filing. And also remember to figure your state taxes for the year. However it does depend on your personal situation and if you file jointly with your husband that may change things. Good luck.
Personally I think IC is great but unless you have some really good deductions you can end up paying a lot in taxes . If you have to pay your own social security at 15% and you were taxed at 20% rate for federal and let's say 6% for state you would be paying 41% of your income in taxes which is no fun. But you only pay on your net income and not your gross so it sort of comes out in the wash.
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