Any Accountants on Board

[AWK]

Yes but the question is what does that translate into savings once it has been added into the whole?

I wrote off 10k a couple of years ago for farm repairs.  Doesn't mean I got 10k added to the bottom line.

Depends on what you owe, how much you make, etc...

[BZ770]

I worked as a 1099 Sales rep one year in my life.  It was hell on taxes that year.  You should try to put up 25% back for taxes but when you are starving to death try and save any money is possible.  Personally I'd operate a cash business if it isn't big and go from there.

[Vandy Vol]

I worked as a 1099 Sales rep one year in my life.  It was hell on taxes that year.  You should try to put up 25% back for taxes but when you are starving to death try and save any money is possible.  Personally I'd operate a cash business if it isn't big and go from there.

Yeah, maybe a little more.  The amount that you know what percentage you have to pay is Social Security and Medicare.  For 2011, those percentages are 2.9% and 10.4%, respectively.  The lowest federal tax bracket is 10%, and your state income tax percentage will be around 5%, so even at a minimum you're adding 15% in income tax to the 13.3% FICA rate, or a total of 28.3%.

But you've also got to consider any business license costs that you'll incur, both city and county.  Those essentially operate as annual taxes and are assessed by the same local revenue departments that assess general taxes.

I would say that withholding and then timely paying in an estimated 30% is playing it pretty safe...unless your business just starts booming, and you never adjust your withheld income tax to reflect your shiny and newly acquired tax bracket.

[Kaos]

So whats' the deal with Obama supposedly wanting to have the IRS do everybody's tax returns? 

According to the news up here in New England the plan is for the IRS to review W2 and bank account records and issue everyone a bill on April 15.  Then you bend over and take it.  Or they do. 

The day they do that is the day my deposits begin being made in Swiss banks.  or a mattress. 

[Vandy Vol]

So whats' the deal with Obama supposedly wanting to have the IRS do everybody's tax returns? 

According to the news up here in New England the plan is for the IRS to review W2 and bank account records and issue everyone a bill on April 15.  Then you bend over and take it.  Or they do. 

The day they do that is the day my deposits begin being made in Swiss banks.  or a mattress.

The idea of having the I.R.S. prepare your returns for you began to be tossed around years ago...2005 or 2006 I think?  Anyhow, it was initially proposed by a couple of Democrats.

In theory, it's a decent idea.  The I.R.S. sends me a proposed bill, which I can either accept or refute.  It saves me the time from having to prepare my return.

But, in reality, it's just going to result in an inaccurate return, and will be a huge waste of time to try to correct.  The I.R.S. receives very little information which would be relevant to my tax return; essentially, they've only got income earning statements from my employers.  They have no idea whether I've recently had a child, bought a house, went back to school, or have otherwise done something that entitles me to a deduction or credit.

I've seen the I.R.S. file substitute returns for taxpayers who have failed to timely file the returns themselves.  Their assessment of what is owed based upon those substitute returns is often astronomically incorrect for the aforementioned reasons.

For some people with very basic returns, it may save them some time and headache.  But for those of us that take as many deductions as we legally can, it would be just more of a hassle to try to contact the I.R.S. and correct the return that they prepared for us.

Jim Cooper is the one trying to push this idea through as of recently, but his is an optional service.  The I.R.S. will send you a proposed return.  If it looks alright, then you can file it.  If it doesn't, then you can still file your own like you always have.  Not a bad idea if you ask me, just so long as they don't have plans to try to change the law so that you are forced to use it in the future.

http://cooper.house.gov/index.php?option=com_content&task=view&id=456&Itemid=73

[AUTailgatingRules]

I have a taxes question that google is failing to answer for me.

If I teach private guitar lessons as a side income, what percent will be taxed? 

Let's say I make $1000/month.

Does that just add on to my total yearly income, or is it taxed separately?

If it's cash you are in the clear   screw Obama and his taxocracy

[Token]

I'm been thinking about moving to Mexico and becoming a corrupt police chief.  This would definitely be a step in that direction.

[GarMan]

http://cooper.house.gov/index.php?option=com_content&task=view&id=456&Itemid=73

What a moron!  With all of the geniuses in the government sector, this would become one huge debacle.  They might be able to handle the EZ forms, but I could never see them working with depreciation schedules, deductions, basis recalculations or anything of any substance.  Moonbats...

[Vandy Vol]

What a moron!  With all of the geniuses in the government sector, this would become one huge debacle.  They might be able to handle the EZ forms, but I could never see them working with depreciation schedules, deductions, basis recalculations or anything of any substance.  Moonbats...

That's just the thing:  They won't be working with anything complex.  Even though they have your previous year's return and they know that you take X, Y, and Z deductions, they still will not claim them for you on a return that they've prepared for you.

Like you said, for those people with EZ forms, it might be worth it.  But for everyone else, the I.R.S. is simply going to be mailing out returns that aren't accurate.

The good thing about Cooper's plan is that you have the option to reject the I.R.S.'s return, and you can do that without contacting the I.R.S. and having them correct the return they prepared; you just file your own returnlike you normally would and pretend that the I.R.S. didn't send you shit.

The only question is how much it's going to cost us to have the I.R.S. prepare returns for every taxpayer.  If they can do it without increasing spending for revenue costs (which is not likely), then sure, it sounds great for Joe Sixpack who claims no deductions and has his employer withhold the right amount of taxes from his check.

But for most of us, this type of service would be completely useless, so I see no point in implementing it if it's just going to cost us more money.

[GarMan]

Like you said, for those people with EZ forms, it might be worth it.  But for everyone else, the I.R.S. is simply going to be mailing out returns that aren't accurate.

The good thing about Cooper's plan is that you have the option to reject the I.R.S.'s return, and you can do that without contacting the I.R.S. and having them correct the return they prepared; you just file your own returnlike you normally would and pretend that the I.R.S. didn't send you shit.

The only question is how much it's going to cost us to have the I.R.S. prepare returns for every taxpayer.  If they can do it without increasing spending for revenue costs (which is not likely), then sure, it sounds great for Joe Sixpack who claims no deductions and has his employer withhold the right amount of taxes from his check.

But for most of us, this type of service would be completely useless, so I see no point in implementing it if it's just going to cost us more money.

Worth it?  Well, it would be an easy way to justify doubling the size of the IRS.  I'm sure the Dems would be giddy over this.  It's just another money and power grab.  No thank you... 

[DnATL]

If you're one of the millions with zero tax liability, why would you care?

[Vandy Vol]

If you're one of the millions with zero tax liability, why would you care?

Because those who have zero tax liability due to multiple claimed deductions and credits would suddenly have a tax liability, as the I.R.S. wouldn't prepare their return so as to include those deductions and credits.

[Kaos]

If we went to a flat tax where deductions didn't matter and EVERYBODY paid 10% of gross I'd be okay with the IRS sending me a statement of record. 

An even tax distribution would also resolve that pesky deficit problem.  At least until they started spending more. 

[Saniflush]

If we went to a flat tax where deductions didn't matter and EVERYBODY paid 10% of gross I'd be okay with the IRS sending me a statement of record. 

An even tax distribution would also resolve that pesky deficit problem.  At least until they started spending more.

But then think of all those poor CPA's that would be out of work. 
Never happen.
I wish it would but I won't ever see it in this country in my lifetime.

[GarMan]

An even tax distribution would also resolve that pesky deficit problem.  At least until they started spending more.

There are a shitload of assumptions behind that one.  Without a balanced budget requirement on government, the chances of this are slim to none.

[AU_Tiger_2000]

Like you said, for those people with EZ forms, it might be worth it. 

Have you ever filled out an EZ form?  I used to file my taxes with a touch tone telephone with an EZ form circa 1993.  I thought I was on Star Trek.  If filling out the EZ form is too much of a headache you should just send all your money to charity and apply for food stamps.

[Vandy Vol]

Have you ever filled out an EZ form?  I used to file my taxes with a touch tone telephone with an EZ form circa 1993.  I thought I was on Star Trek.  If filling out the EZ form is too much of a headache you should just send all your money to charity and apply for food stamps.

Yes, I have.  It's not hard in the slightest, neither did I say it was.  I was only stating that, for those who file an EZ form, it may be worth it for them.  Afterall, wouldn't it be easier to not have to worry about filling out the form at all and having someone else do it for you?

However, don't confuse that as an endorsement of the proposal.  Having the I.R.S. prepare returns for taxpayers would result in more government spending footed by the taxpayer, and with no real benefit to your average taxpayer; most taxpayers would still have to file their own returns, as the government's returns wouldn't be accurate.