Paying Taxes

[Young Spark]

I am quite sure this topic was talked on here somewhere but unfortunately it seems it slipped and slid into the far out pages. So I figured I'd start a new topic, plus get some advice.

I have done some research and I learned a tiny bit about paying taxes (us self-employee'd people) and I understand we have to pay 15.3% for our social security and medicare. I believe its 12.1% for social security and 2.3% for medicare or somewhere along them lines, with there only being a $90k maximum payment for social security a year (meaning once you pay in $90k to social security, that's all you pay for social security in a year's time, but medicare must continue to be paid.)

What I would like is for some tips and hints that can help me and the other self-employee'd people out there that'll keep us from penalties and fee's that the IRS can hit us with... or even tips and advice that'll teach us exactly how much we have to pay to the IRS so keep them off our ass!

Thanks

[postman da rich kid]

Here's my tip.. Go see an accountant. You already seemed mixed up lol. I wouldn't trust online tips either. Things vary state to state so the safest way is just to talk to an accountant.

[Young Spark]

^^ Not to come off as a smartass, but will your tip be paying for everyone to consult with an accountant? You gotta realize that not everyone has the money to go see an accountant as many like to charge "consulting fees." And honestly, a tips is a tip, it doesn't have to be taken up on, but it can help clear the air for some.

Me myself, if I wanted to see an accountant, I'd go to my friend as she is a college accountant graduate, but I want the community to learn something, not just me... hence the post "Paying Taxes." And where do I seem mixed up in my post?

[postman da rich kid]

^^ Not to come off as a smartass, but will your tip be paying for everyone to consult with an accountant? You gotta realize that not everyone has the money to go see an accountant as many like to charge "consulting fees." And honestly, a tips is a tip, it doesn't have to be taken up on, but it can help clear the air for some.

Me myself, if I wanted to see an accountant, I'd go to my friend as she is a college accountant graduate, but I want the community to learn something, not just me... hence the post "Paying Taxes." And where do I seem mixed up in my post?

I see the problem already. You need realize I've been there and done that. In the long run there is no way around seeing an accountant. Your talking about tips like taxes aren't a very complicated subject. You can try to get smart or take my advice. Right now you come off to me as a young know it all kid, which isn't good.

Everybody gets there taxes done once a year. Use that time to consult with your accountant. Squeeze as much information as possible out of him. Most accountants I meet never charged me to call them and ask them a few questions. It's all about networking in this game.

So you can look for tips but like I said that is not a good nor professional way of handling your business.

[Young Spark]

^^ But you have to realize, taxes ISN'T a hard subject neither, its not like a 5,000 step program. I understand the whole process of going to see an accountant and maybe you weren't charged but you have to think outside of the box... accountants vary from place to place.

Now I never branded myself as a young know it all kid, but I feel as though I know what I'm talking about, assuming I've been learning the world of business for the last 1.5-2 years --- although I haven't learned everything, I know that tips and advice would work better then having an accountant try and explain to you in their "advanced" terminology, which in the end lead's you to frustration and utilizing their services.

In my opinion, its better to learn then have to pay an accountant to do the taxes for you, so atleast you can put some effort into helping the CPA and minimizing accountant cost's and fee's. Plus, the IRS has so much information that is free... but sometimes we need a "live discussion" of such topics to broaden the future for others.

[SpencerB]

^^ But you have to realize, taxes ISN'T a hard subject neither, its not like a 5,000 step program. I understand the whole process of going to see an accountant and maybe you weren't charged but you have to think outside of the box... accountants vary from place to place.

Now I never branded myself as a young know it all kid, but I feel as though I know what I'm talking about, assuming I've been learning the world of business for the last 1.5-2 years --- although I haven't learned everything, I know that tips and advice would work better then having an accountant try and explain to you in their "advanced" terminology, which in the end lead's you to frustration and utilizing their services.

In my opinion, its better to learn then have to pay an accountant to do the taxes for you, so atleast you can put some effort into helping the CPA and minimizing accountant cost's and fee's. Plus, the IRS has so much information that is free... but sometimes we need a "live discussion" of such topics to broaden the future for others.

Yea, you are right, its not a 5,000 step process.... more like 10,000 steps....

The in's and out's of the tax system is far more complex than any entreprenuer needs to know, and if you do get that far, you may as well be a CPA.

A quality CPA is money well spent. If you can't afford one, then you probabily will have no problem using some sort of "turbo tax" program for $49.99, which will do basic accounting/filing for you.

Here's a quick lesson to add to your 18 months of experience, as a successful business leader/entreprenuer, you need to learn how to delegate work out to others. If you try to do everything yourself, you will be swamped with bullshit, your business will never grow, and you'll probabily kill yourself from stress.... Doing anything more than a simple tax filing is one of those things you need to delegate out to a qualified individual. Again, if they are worth their weight, they will save you far more than they cost.

If you still insist on doing your own taxes, with assistance from a CPA, I would suggest buying some CPA tax textbooks. I have CPA friends with these books, and they are loaded with tons of these figure/statistics/rules/etc. Thousands and thousands of pages of it....

[Young Spark]

Well to be quite honest, before I'd pay a CPA, I'd shed out the money that could go to a CPA in the H&R Block Tax Preparer program which would help me better then any CPA could do. Its like the saying goes, only YOU know your business well, nobody else does. Its you that started your business, its your position to understand the aspects of keeping the business running without any outside complications.

[SpencerB]

Well to be quite honest, before I'd pay a CPA, I'd shed out the money that could go to a CPA in the H&R Block Tax Preparer program which would help me better then any CPA could do. Its like the saying goes, only YOU know your business well, nobody else does. Its you that started your business, its your position to understand the aspects of keeping the business running without any outside complications.

Fair enough, you want to do your own taxes.

Just food for thought, I know not one successful entrepreneur/business leader/wealthy individual who does his/her own taxes.

Again, CPA's pay for themselves with tax savings an average Joe businessman (even one who goes to H&R block) cannot utilize.

[Young Spark]

Everybody has their way's... and how can you be a successful businessman if you don't know every aspect of business. Just some food for thought in return, how can you necessarily guarantee and accountant is doing a general ledger right if you don't know what to look for? Sometimes, a true businessman likes to be active in their company, not just sit around and outsource business.

[Commercial-Realtor]

You can just stop in to an IRS office. They'll answer questions and give you publications.

Studies have shown that IRS emplyees often give wrong answers so try to confirm information by reading the documents yourself.

[postman da rich kid]

Everybody has their way's... and how can you be a successful businessman if you don't know every aspect of business. Just some food for thought in return, how can you necessarily guarantee and accountant is doing a general ledger right if you don't know what to look for? Sometimes, a true businessman likes to be active in their company, not just sit around and outsource business.

I honestly believe you need to go to school for business my friend. You seem to be a bit misguided in what it takes to successfully start and run a business. I'm what some would call a successful entrepreneur and I'll tell you business classes really helped me understand how to run a successful business. Your idea's and theories of a businessman are wrong.

[Young Spark]

Honestly postman, I believe what is right. I don't need to go to a school of business because much of the information that some of these "schools" give are outdated. To me, you sound more of a "hustler" as your signature says, and I admire that... your all about your money, I can respect that.

But a true businessman monitors the works of their company, he/she does not just do leadership, they become INVOLVED with their company, they track and make sure everything is in order and organized with their company. That's what I meant when I stated "Sometimes a businessman likes to be active with their company, not outsource it to CPA's and other professionals." Now don't take me as saying WE DON'T NEED THESE PROFESSIONALS, its more like I'm saying we NEED TO KNOW IN A SIMPLE MANNER HOW SOME (OF THESE PROFESSIONALS) WORK. That way we can always verify their work is right.

Simply what I'm saying is, its always smart to be able to verify the work of the professionals through either yourself or a actual trusted professional that majors in the same field.

But I admire your being a hustler and everything, but school of business really won't help me out cause as I said, somebody in a business state of mind as I am wants real results... and of course I am sure that a school of business can provide it, I rather go a differenter way.

BTW... can we get back on topic plz...

BTW... Good advice Commercial-Realtor

[jasaunders]

I saw a Harvard Business School video yesterday on an unrelated topic, and one of the things someone in the video said was "The more we thought we were both right, the more beligerent we both got. It would get out of control. In the end, we were both so beligerent that neither of us really knew the right answer."

Moral of the story, you are both right.
From my experience, it helps to be skilled in accounting and keeping track of your books, but it is also valuable to get advice from a professional and have a professional do work that you aren't competent to do. Luckily, with my current business, my partner works in the commercial lending industry and is able to take care of all our books and handle most of our finances. But we still consult with our CPA often on how we should do certain things, even though technically at the moment, our CPA only handles our tax returns.

[rush1169]

What I would like is for some tips and hints that can help me and the other self-employee'd people out there that'll keep us from penalties and fee's that the IRS can hit us with... or even tips and advice that'll teach us exactly how much we have to pay to the IRS so keep them off our ass!

Thanks

Go to the IRS website and get a TaxID number and rest assured you'll receive all the instructions and forms needed to do things correctly and on time.

[Young Spark]

Josh: Thank you for that, I wasn't necessarily disagreeing with postman... I was just starting that its smart to have the knowledge so that you can verify and check everything over, I wasn't necessarily neglecting the idea of going to a professional to have the work done. I'd just like to be able to make sure that even the basic stuff is done correctly by the CPA, which would give me a little trust in them.

On top of that, if you know the basic things about taxes, it could save you money when it comes to filling out tax forms or whatever, then you could take it to a CPA and have them check over it. If you did it right, your done, if you didn't, you can pay them to correct the errors or mistakes or even re-do the whole thing over. Its also smart to have the CPA show you exactly what their doing, although its not really a necessity.

Rush: Thank you for the advice, I'll do that... can't I use my SSN as my TaxID as well?