Self Employment Tax forms.

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2012-08-01 9:07 AM

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Tempe, AZ
Subject: Self Employment Tax forms.

It seems like I have read a quite a few of fellow BTers are accountants/numbers people, so hopefully someone could point me in the correct direction. I'm trying to get my paperwork in check so that I can pay the "man." I know most info is on the IRS website, but in all honesty, the verbiage on the website is Greek to me and makes no sense.

I have an LLC. I gross around 20-25k a year pre-tax. I have very minimal write offs (but would like to find more creative/legal ways to write more off). Around 1/4 of my work is done at my house and my car/cell phone is used around 50% of the time for business.

Do I fill out a 1040? 1040EZ? Schedule C?

Any help would be greatly appreciated.

2012-08-01 9:19 AM
in reply to: #4340740

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Subject: RE: Self Employment Tax forms.

LLC is a pass thru entity.  The income/loss is reported on your personal taxes.  You show the LLC taxes via it's own return and the income/loss is reported on schedule K-1 on your personal taxes.

At least that's how it works here in FL.

My advice: find a good CPA than can help you find the proper deductions.

2012-08-01 9:25 AM
in reply to: #4340771

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Tempe, AZ
Subject: RE: Self Employment Tax forms.
Thanks for the advice.. I was hoping I could do this on my own to save some money, but a CPA would likely help me save money in the long run.
2012-08-01 10:36 AM
in reply to: #4340740

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Subject: RE: Self Employment Tax forms.
If you are a single member LLC, you file all your income and expenses on your personal return on a Schedule C.  If you have more than one member, you will file a 1065 and then the income will flow to your personal return.
2012-08-01 11:34 AM
in reply to: #4341032

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Subject: RE: Self Employment Tax forms.
do LLC's have to file estimates quarterly, and pay quarterly if applicable?
2012-08-01 12:32 PM
in reply to: #4341234

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Subject: RE: Self Employment Tax forms.

ried0428 - 2012-08-01 11:34 AM do LLC's have to file estimates quarterly, and pay quarterly if applicable?

If you are turning a profit you do.

With the cash deficit of our government they are trying to find every way to get as much cash in the door.

I had an IRS agent show up at my doortsep a few months ago with the intention of embarrassing me in front of my employees.  After my accountant got done with her I got a refund.  So much for trying to shake some loose change from my pockets.

The lesson for me was hiring an accountant was less expensive than filing my own taxes. 



Edited by Hugh in TX 2012-08-01 12:34 PM

2012-08-01 12:38 PM
in reply to: #4340740

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Subject: RE: Self Employment Tax forms.

The lesson for me was hiring an accountant was less expensive than filing my own taxes.

Even if it turns out to be more expensive, it's more satisfying than giving that money to the IRS.

2012-08-01 3:05 PM
in reply to: #4341032

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Subject: RE: Self Employment Tax forms.

Mrschach - 2012-08-01 10:36 AM If you are a single member LLC, you file all your income and expenses on your personal return on a Schedule C.  If you have more than one member, you will file a 1065 and then the income will flow to your personal return.

 

I am a single member.  So I fill out the schedule C paperwork and send it in with the other stuff that my wife and I file? Or, do I need to file separately?

This presents another question... Would it be more beneficial for me to just consider myself an independent contractor and skip the whole LLC altogether seeing how I am not bringing in all that much money?  What I'm really interested in is just finding a simple way to be self employed as I'm not going to have employees any time soon.



Edited by seankanary 2012-08-01 3:11 PM
2012-08-02 9:51 AM
in reply to: #4341901

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Subject: RE: Self Employment Tax forms.

Hugh in TX - 2012-08-01 1:32 PM

ried0428 - 2012-08-01 11:34 AM do LLC's have to file estimates quarterly, and pay quarterly if applicable?

If you are turning a profit you do.

Actually only if you are owing more taxes than you estimate.  You can be profitable and yet still not paying more taxes than withheld and not pay quarterly.

 

 

seankanary - 2012-08-01 4:05 PM

This presents another question... Would it be more beneficial for me to just consider myself an independent contractor and skip the whole LLC altogether seeing how I am not bringing in all that much money?  What I'm really interested in is just finding a simple way to be self employed as I'm not going to have employees any time soon.

The advantage of an LLC (Limited Liability Corporation) is that it separates you (legally) from the company.  So if you screwed up something in your LLC you clients cannot come after your personal financial resources (for the most part).  If you are doing the work as yourself (not through an LLC or Corp) the client can file suit against you personally.

I urge you to go see a CPA.  I know it's money that could be profit, but it can save you LOTS in the long run.  For example I first learned about the federal R&D tax credit through our CPA years ago.  It has saved us tens of thousands of dollars off the bottom line check to the IRS every year.  That has paid for the CPA fees multiple times over...

2012-08-02 2:03 PM
in reply to: #4341901

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Subject: RE: Self Employment Tax forms.
seankanary - 2012-08-01 3:05 PM

Mrschach - 2012-08-01 10:36 AM If you are a single member LLC, you file all your income and expenses on your personal return on a Schedule C.  If you have more than one member, you will file a 1065 and then the income will flow to your personal return.

 

I am a single member.  So I fill out the schedule C paperwork and send it in with the other stuff that my wife and I file? Or, do I need to file separately?

This presents another question... Would it be more beneficial for me to just consider myself an independent contractor and skip the whole LLC altogether seeing how I am not bringing in all that much money?  What I'm really interested in is just finding a simple way to be self employed as I'm not going to have employees any time soon.



Fill out the Schedule C and file jointly with your wife. Keep the LLC for liability protection.
2012-08-02 6:37 PM
in reply to: #4340740

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Subject: RE: Self Employment Tax forms.
Not only does a CPA "find" you money and thus "pay" for his/her services, if you do it yourself and screw something up, even if it's the most minor of things, you lose considerable time (thus, money in lost productivity) and go through MEGA frustrations in trying to correct it, and get the IRS to figure out what you did and how you corrected it and to actually show the correction. Speaking from experience as a small business owner (though we're an S corp for some nice little tax advantages with profits and distributions--also a byproduct of hiring a CPA). I think annually we pay around $500 or $600 to have our business taxes prepared for us and my wife handles the quartlerly estimated payments and whatnot.

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