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Affiliate marketing and taxes (doing it safe and legal)

Discussion in 'Business & Tax Advice' started by littleuser, Aug 12, 2009.

  1. littleuser

    littleuser Registered Member

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    This is for the US.
    Lets say that you are a member of a affiliate network and you are making money. This network requires you to fill out an W-9 form. First, is this common that you have to fill out this form? what information is safe to give out to networks? If i dont want to give out my SSN i understand that i can apply for a Employer Identification Number (EIN), what are the steps to get one and use it?

    how and when would i be paying all my taxes?


    All these questions are broad but what i really need is for someone to clarify the process from when you join a network to making the money to paying taxes, staying legal and safe.


    thank you for the help.
     
  2. PerfectChoice4u

    PerfectChoice4u Junior Member

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    Best advice, stay with companies located outside of the us. And, if your Canadian and they are a us based company, well they then don't have anywhere to report to do they... (wink wink)
     
  3. littleuser

    littleuser Registered Member

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    well lets say that you want to do this big scale and as your main income stream. i have no problem paying taxes on my earnings i just want to know how to do it.
     
  4. TheInternetHustler

    TheInternetHustler Regular Member

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    You can apply for a EIN online. You generally dont have to worry about filling out your SSN, companies have better things to do then steal your identity. Pay you taxes as normal, write off your expenses, and, unfortunately, pay your 10% self employment tax.

    If you are making over 5 figures, it may be in your best interest to contact a tax specialist to make sure your doing it right. If you dont do that at least get turbo tax or something.
     
  5. TheInternetHustler

    TheInternetHustler Regular Member

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    Shit, I got to start doing that! :) Writing off that stuff plus computers and stuff is a great perk of IM :)
     
  6. jmascis

    jmascis Registered Member

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    I agree. Accountants know all the good loopholes.
     
  7. littleuser

    littleuser Registered Member

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    so at the end of the year you put down how much you have made and pay the taxes, if you paid too little they tell you to pay more and if you paid too much they will give it back. did i get it right?

    cant i pay my taxes each month?
     
  8. The_Architect

    The_Architect Newbie

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    Location:
    Hidiselu de Jos, Romania
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    No. April 15th is the due date for filing. However I have been wondering if I can pay them with a check instead of going through and telling them my account number in Romania which is safely far away from Americans' greasy hands :D
     
  9. theadultsplayground

    theadultsplayground BANNED BANNED

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    At the beginning of next year (by Jan 31st) you will receive your W-2's from the network you made money with (I think if you make over $600 in that previous year). Depending on what state you live you'll have to pay both state and federal income tax.
     
  10. 7878

    7878 Executive VIP Premium Member

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    It's a 1099, and yes it's for payments over $600 in one year. ;)
     
  11. littleuser

    littleuser Registered Member

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    so lets say i make over 600, should i put away a good amount of money in proportion to how much i made and wait for the gov to ask for the money?
     
  12. RealMoney

    RealMoney Regular Member

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    I would suggest looking into starting an LLC company in your state. Also look into s-type corporations.

    You should hold back 40% of your earnings in a savings account or safety deposit box. This is a conservative stand point that makes sure you will have enough to cover yourself, and you will get a nice bonus from the left over money.

    They should not be sending you a W-2. You are not an employee you are a subcontractor in a way. You should be getting a 1099. This is only if you make 600+ in a fiscal year.

    Depending on how much you make, if you are an LLC, you can have a CPA sit down and deduct everything you spent money on. Your internet bandwith, servers, pva's, software, proxies, accounts, literally anything that cost you money to make money. Then the CPA will send in a nice laminated tax form to the IRS along with what you owe for the year.

    Let me know if you need any more advise.
     
    • Thanks Thanks x 1
  13. littleuser

    littleuser Registered Member

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    that made things more clear, thanks realmoney and everyone else.
     
  14. tical525

    tical525 Newbie

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    Don't fuck around with the IRS. Pay your taxes. If you don't get 1099'd, report your income anyway. You do not want to catch a federal money laundering charge.

    Keep your shit tight. This is business. The IRS isn't stupid and just about everything will leave a paper trail. Anything you bring into the states you NEED to claim.

    I'm dealing with an audit for 2007 right now (old company I had). It is not going to be fun, but thankfully my book keeper & accountant have everything in order.
     
  15. spla

    spla Junior Member

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    so in the us you pay around 40% of your im money to the taxman ?
     
  16. RealMoney

    RealMoney Regular Member

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    The amount you pay is all over the place. If you have a single owned LLC and you are to be paid from said LLC, the money can be taxed twice, making it easy to rack up 40%.

    With all the deductions I can pull out of thin air, and every bit of time I can spend with my CPA, I am able to bring it down to around 18%-22%.

    Saving 40% is best since then you get a large bonus every year after taxes anyway.

    ALSO! If you do not get 1099'd, you don't want to work for them if you make 50,000$ a year or more. If you go to IRS and report $120,000 in earnings with no 1099 or w2, you will be investigated with out any doubt in my mind, especially with no corporation behind you.

    Good luck!
     
  17. seojumper

    seojumper Regular Member

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    Well, you can open an offshore company with nominee shareholder and director, get yourself an anonymous credit card with bank account, and use it to withdraw money through ATMs. Voila, the money came to you untaxed.

    You still have to prove where did you get the money, if they ask you, how did you by a new ferrari, but if you are not stupid, you can make it work.
     
  18. darklegion

    darklegion Regular Member

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    Getting yourself incorporated is about the best thing you can do... My business pays $0 in taxes due to how I file my taxes... What ever the company makes then gets spent as an expense.
     
  19. seojumper

    seojumper Regular Member

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    Keep in mind.. I am not from US. But it can be done, if you are smart.
     
  20. littleuser

    littleuser Registered Member

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    people this thread was made to discuss how to actually pay your taxes and stay legal, please dont bother with methods to stay away from taxes like offshore accs and cards.