vb.org Archive - making some $$$, what's the tax situation?

vb.org Archive (https://vborg.vbsupport.ru/index.php)

- Community Lounge (https://vborg.vbsupport.ru/forumdisplay.php?f=13)

- - making some $$$, what's the tax situation? (https://vborg.vbsupport.ru/showthread.php?t=98937)

making some $$$, what's the tax situation?

I've set up a subscription on my site, and it already pays for hosting and forum software, but there's some extra profit. Has anyone claimed this on their taxes? This was started as my personal site, but grew to over 250 members in the past 8 months.

Quote:

Originally Posted by dennisuello

Unless a gift exceeds $9,999.00 it doesnt have to be claimed.......

They are all gifts! :rolleyes:

Depends where you are in the world as to what you have to declare ;)

Not sure of American laws but you may want to get legal counsel to make sure you aren't breaking any laws at all...

Chris

Has any one got a rough idea for us brits?

Thanks,
Mat

As far as I am aware there are no restrictions as long as you are not a profit-making business...

If you are a freelance coder/designer or independent individual making a small profit then there is nothing they can do, afaik - However you'd be best checking that out with a lawyer...

Chris

Quote:

Originally Posted by Nutzz

Has any one got a rough idea for us brits?

Thanks,
Mat

Int he US, did you make more than 600 dollars? Generally if not then you can probally ignore it and not worry about it too much. The income I take in from my boards totals way less than 600 a year. Adsense might pay me out 100~ dollars for the whole year, I see it as a nice christmas bonus :D

If I get over $500 dollars a year, I report it to the government. Anything less, is a donation/gift!

Quote:

Originally Posted by Chris M

Yeah its only a few ? every month so I think I will be OK.

Thanks Chris.

Thanks,
Mat

Quote:

Originally Posted by Chris M

However you'd be best checking that out with a lawyer...

Chris

or an accountant ;)

I don't trust them as far as I could throw them; Lawyers are obligated to tell you the law else they can get in bad trouble for lieing to you and causing you to break it - Accountants are dodgy people ;)

NB: This is the opinion of me, not Jelsoft Enterprises or vBulletin.org - If you are an Accountant, please do not take offence to the dodgyness of your law-bending :D

Chris

Well for those of us in the USA why not go straight to the source on who has to do what.

Right from Uncle Sam's fav. website...The IRS:

Quote:

Self-employed individuals, sole-proprietors, independent contractors and persons who have net earnings of $400 or more are required to pay self-employment tax by filing Schedule SE (PDF), attached to their Form 1040, U.S. Individual Income Tax Return. Employees of a church that receive income of $108.28 or more, but do not receive a Form W-2 for the earnings must also file pay self-employment tax by filing a Schedule SE, attached to Form 1040, U.S. Individual Income Tax Return.

As a self-employed individual (someone who owns an unincorporated business) or an independent contractor, you are required to report income and expenses on a Schedule C (PDF) or C-EZ (PDF) and calculate your earnings (scroll down to Figuring Earnings Subject to Self-Employment Tax) subject to SE tax. The completed Schedule SE will be attached to your Form 1040, U.S. Individual Income Tax Return.

As a member of a partnership that carries on a trade or business, or as a member of a Limited Liability Company (LLC) that chooses to be treated as a partnership, your distributive share of its income or loss from that trade or business is included in your net earning from self-employment. These entities must report the business income and expenses on Form 1065, U.S. Return of Partnership Income, along with a Schedule K-1 reporting each partner's net income or loss. You must file a completed Schedule SE attached to your Form 1040, U.S. Individual Income Tax Return.

If you have employees, you must pay employment taxes, including Federal income, Social Security, and Medicare taxes.

If you manufacture or sell certain products, operate certain kinds of businesses, use various kinds of equipment, facilities, or products, or receive payment for certain services, you may need to pay excise taxes.

Estimated tax is the method used to pay (including SE tax) on income not subject to withholding. You generally have to make estimated tax payments if you expect to owe taxes, including self-employment tax, of $1,000 or more when you file your return. Use Form 1040-ES (PDF) to figure and pay the tax.

source

Ok it's takes either a lawyer or a finiacial expert to understand that mombo, possibly both. But the over all idea is, if you make more than $400 (in a year presumably) you should pay estimated self-employment taxes during the year. By paying during the year, you save yourself a big bill come April 15th. Though you may still have a bill, it should be substantialy smaller than it might have been had you not pre-paid.

I have reciently been giving thought to starting my own web-based business so it was nessisary for me to hunt down and attempt to figure out what the mumbo jumbo ment.

Though I would agree with the sentiments stated to concult a tax lawyer or an accountant. They are better suited to inform you what and how is the best way for you to proceed. I mean if you aren't gonna be making boat loads of cash, they may tell you to not make the estimated payments, just set aside funds to pay at the end of the year. Or they may suggest other options like becoming and LLC. or whatnot.

Quote:

Originally Posted by dennisuello

You can only claim hosting costs as a tax deduction if you pay taxes on the profits as well.

X vBulletin 3.8.12 by vBS Debug Information
Template Usage: (1)ad_footer_end (1)ad_footer_start (1)ad_header_end (1)ad_header_logo (1)ad_navbar_below (6)bbcode_quote_printable (1)footer (1)gobutton (1)header (1)headinclude (6)option (1)post_thanks_navbar_search (1)printthread (12)printthreadbit (1)spacer_close (1)spacer_open Phrase Groups Available: global postbit showthread	Included Files: ./printthread.php ./global.php ./includes/init.php ./includes/class_core.php ./includes/config.php ./includes/functions.php ./includes/class_hook.php ./includes/modsystem_functions.php ./includes/class_bbcode_alt.php ./includes/class_bbcode.php ./includes/functions_bigthree.php Hooks Called: init_startup init_startup_session_setup_start init_startup_session_setup_complete cache_permissions fetch_threadinfo_query fetch_threadinfo fetch_foruminfo style_fetch cache_templates global_start parse_templates global_setup_complete printthread_start bbcode_fetch_tags bbcode_create bbcode_parse_start bbcode_parse_complete_precache bbcode_parse_complete printthread_post printthread_complete
Messages:

Phrase Groups Available:

X vBulletin 3.8.12 by vBS Debug Information
Page Generation 0.01673 seconds Memory Usage 1,743KB Queries Executed 10 (?)
More Information
Template Usage: (1)ad_footer_end (1)ad_footer_start (1)ad_header_end (1)ad_header_logo (1)ad_navbar_below (6)bbcode_quote_printable (1)footer (1)gobutton (1)header (1)headinclude (6)option (1)post_thanks_navbar_search (1)printthread (12)printthreadbit (1)spacer_close (1)spacer_open Phrase Groups Available: global postbit showthread	Included Files: ./printthread.php ./global.php ./includes/init.php ./includes/class_core.php ./includes/config.php ./includes/functions.php ./includes/class_hook.php ./includes/modsystem_functions.php ./includes/class_bbcode_alt.php ./includes/class_bbcode.php ./includes/functions_bigthree.php Hooks Called: init_startup init_startup_session_setup_start init_startup_session_setup_complete cache_permissions fetch_threadinfo_query fetch_threadinfo fetch_foruminfo style_fetch cache_templates global_start parse_templates global_setup_complete printthread_start bbcode_fetch_tags bbcode_create bbcode_parse_start bbcode_parse_complete_precache bbcode_parse_complete printthread_post printthread_complete
Messages: