Made about 65k through online marketing

[invinceable]

I still have about 40k in the bank, so I haven't spent it all. Gave money to family (tax write-off), bought computer (another tax write-off) so probably about 12k in write-off's. How much of this 40k should I set aside for taxes.

Any very general numbers would be greatly appreciated.

I'm in Indiana, USA btw.

Thanks!

 

[stung]

About 10k you should set aside
hxxp://www.moneychimp.com/features/tax_brackets.htm

 

[invinceable]

About 10k you should set aside
hxxp://www.moneychimp.com/features/tax_brackets.htm

Cool man, I appreciate it, thanks given. I was thinking around there, but someone told me up to 20k, and I thought that sounded a tad bit too high.

One last question though, how much work is it to set up an LLC for a sole-proprietorship that you are running with a DBA right now.

Vince

 

[showbizvet]

There are a ton of resouces on Google

http://www.google.com/search?hl=en&q=setting+up+an+llc&sourceid=navclient-ff&rlz=1B3GGGL_enUS311US311&ie=UTF-8

about setting up an LLC. The costs will range from very cheap (Legal Zoom) where you do the work, to more expensive if you hire an attorney. Overall though it should be fairly painless and able to be accomplished fairly quickly.

 

[ddasilva]

What's the main benefits of setting up a LLC vs. just DBA? Is it just for liability protection, or is there tax benefits as well?

 

[bigel]

You really should go see an accountant once you are earning a significant amount. They will tell you what kind of business entity to set up and will help you pay as little in taxes as possible.

 

[WhoYoDaddy]

What's the main benefits of setting up a LLC vs. just DBA? Is it just for liability protection, or is there tax benefits as well?

LLC offers you liability, there is also a thing such as S-corp which offers you the same liability but also has a tax savings of about 15% (in my jurisdiction).

Your choice should be between LLC and S-corp. If you plan to earn some money and want some tax savings S-corp is the way to go. If you are doing everything directly under your own SSN or as Sole Proprietorship you are just asking for trouble.

DBA means doing business as, which allows you to do business under fictious name. For example I own a company called Black Hat World Inc. I create 4 DBA's called Black Hat Media, Black Hat Marketing, Black Hat SEO, Black Hat CPA. Now I can legally use all 5 names to receive payments to those names, get checks for those business names and operate them all under 4 new names. All the money will go to the main entity (Black Hat World Inc.) that owns itself + 4 DBA's. You will pay taxes and have expenses all together for Black Hat World Inc. instead of all individual entities.

Ideally you would open a strong company based on your preferance of LLC or S-corp. With time you can expand it with DBA's and maybe some day with spinning off new corporations out of them. Maybe some day in the distant future you will ask about off shore corporations. It is perfectly legal for US corporations to own offshore corporations and its all a matter of time before you can setup your own global networks of corporations!

Happy Incorporating!

 

[wickid]

I'd kick back refunds on that piece of shit script you sold to a bunch of BHW members here then abandoned.

 

[bizzle]

made 65k to keep 20k?

 

[Moto801]

So buying your computer was the only write off you have for your whole business?

You are probably missing lots of other potential write offs as well... If you made 60k then I'm sure you spent a lot of money along the way??

Everything you spent on your business/marketing could be used as a write off. Advertising fees, websites, hosting fees, paying freelancers, etc... and anything else that you invested in along the way.

 

[Qokaine]

if u were blackhat u wouldnt be payin taxes lol

i dont kno anything about tax evasion tho

 

[jazz99]

I always did my own taxes but this year it got to be crazy with all my IM earnings so I just went out and got an accountant. Believe me it is worth the money. I pay the accountant about the equivalent of 1.5-day's earnings every month and she takes care of the rest- quarterly filings, deductions for business, advertising, all my business vacations , expenses, etc.

 

[Spud Jr]

I'd kick back refunds on that piece of shit script you sold to a bunch of BHW members here then abandoned.

Sounds like a personal issue that you could have properly addressed by talking about in private..

 

[Paper-Boy]

Sounds like a personal issue that you could have properly addressed by talking about in private..

don't think he will even reply back.

he has left his forum members in vain.

there were a few hate threads about him.

no offense to the OP.

 

[~@-kanye-west-@~]

almost end of the year its tax timeee!!!!! :angryfire

 

[Spud Jr]

don't think he will even reply back.

he has left his forum members in vain.

there were a few hate threads about him.

no offense to the OP.

That sucks red monkey balls. Well regardless, he should put away 30% of what he made to go towards taxes.

 

[WhoYoDaddy]

almost end of the year its tax timeee!!!!! :angryfire

It's the most wonderful time of the year!!!

 

[JamesAtlas]

I always did my own taxes but this year it got to be crazy with all my IM earnings so I just went out and got an accountant. Believe me it is worth the money. I pay the accountant about the equivalent of 1.5-day's earnings every month and she takes care of the rest- quarterly filings, deductions for business, advertising, all my business vacations , expenses, etc.

Hi Jazz,

How much do you think you are saving having her do it instead of yourself? Did she give you anymore write-offs and save you more money?

 

[ClThis]

Instead of asking someone on this forum, unless they are a CPA, you should going out and asking an accountant.

An accountant will not only tell you how much to set aside but also give you a few other things to write off that you may not have thought about (a portion of your mortgage/rent for a home office, gas for travel, etc)

Please do not take any advice on this forum literally about taxes, anyone, and ask an accountant.


------------------------------------

I just reread the thread and saw that you did hire one, good job. If they were smart, and you can test them, you could also ask them what you should set up as tax and liability protection - they should have recommended something in your first meeting. Its not to late to change accountants.

Your accountant should be your best friend after earnings of almost any amount if it is actually impacting your life - 65k is definitely worthy of getting a good best friend out of finding the right person.

 

[Qokaine]

here's a good tip for those who want to offer a discount to your customers when it gets to tax time, you say due to your taxes you need to get X amount of sales or so and so instead of saying

"were doing a blow out sale come purchase"

you would want to say

"were doing a blow out BECAUSE i need to pay taxes or i'll be screwed so come and purchase while this discount is on fire!"

your giving people a great reason to purchase not because your product is marked down cuz u want more sales

hope this helps sorry its a bit vague