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paypal, corporation, tax

Discussion in 'Business & Tax Advice' started by Coolof, Feb 20, 2011.

  1. Coolof

    Coolof Registered Member

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    Guys i have company named smthng like "Banana Taxi Miami"(it is s-Corporation). And i have website where people reserving regular bicycles for one of my friends for comission. Also on that site i have advertisement for these "TAXI"s.

    Till now all the money i was getting cash, but it's too troublesome and takes a lot of time. So i want customers to pay my% directly on my website as reservation fee. And the rest - they gonna pay him at his store.

    So here i have the question:.
    1.Can paypal name be "Banana Bikes Miami", not "Banana Taxi Miami". Does paypal check the name? Does it have be EXACTLY the same?
    2.If 90% of all money which get to paypal will be spent on this and other sites(have some online projects which need to be done), and only 10% will get to acount bank of "banana taxi Miami" is it ok with IRS, doesn't look suspicious? I want this 90% to be "expenses on advertising" and only 10% actual profit.
    3.I talked to my accounter, he told that i need to collect sales tax. So i will be paying the Sales Tax from all amount which get to paypal. And corporate tax only from this 10% which is actual profit - right?

    Thx
     
  2. Markbh

    Markbh Regular Member

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    Occupation:
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    1. If you register as a corporate entity, I believe your comany name will still be visible. However you may be able to use Banana Bikes as your trading name/Logo, but once the customer goes to payment stage, the company name will show.

    2. Nothing suspiciuous about 90% expenses. It comes via PayPal and leaves the same way, just keep the receipts/invoices archived somewhere.

    3. Yes, sales tax will be added on top of every invoice you issue. And corporate tax will be charged on what is left over, also known as EBIT (earnings before interest & tax) or EDITDA (earnings before interest, tax, depreciationa and amortization).

    Hope this helps.
     
    • Thanks Thanks x 1
    Last edited: Feb 22, 2011
  3. Profector

    Profector Newbie

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    In the answer to #1, are you saying that I can use a DBA to register with Paypal ?

    Tks
     
  4. ooodaveb

    ooodaveb Junior Member

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    As far as I know you business name can be anything on Paypal. I've got a business name that I've not incorporated or even filed a DBA for. Granted it was set up a decade or so ago, things might have changed.
     
  5. Coolof

    Coolof Registered Member

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    You mean the transaction IDs? or screenPRINTS with each transaction?


    This is what my friend telling me as well. Gonna try and will post how it works.
     
  6. Markbh

    Markbh Regular Member

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    I assumed actual invoices, as you seem to be working out of Florida through a company, so you'll probably need to do your taxes. And keep the invoices you mail/print for customers' use but even more importantly - the ones that are the basis of your payments out of the PayPal account.
     
  7. Coolof

    Coolof Registered Member

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    hi guys, thx for all suggestions. I filed corporation, configured paypal business account, and everything going nice.
    But have some new question.

    Currently my website makes 3-4K/month. All through paypal.
    70% of this money i send by paypal to the bisness owner
    30% stays on my paypal, big portion of which get spend on SEO services for other projects.

    I keep all invoices/reciepts from buyers, and invoices from SEO providers.

    So let say TOTAL sales for my biznes paypal account will be 30K.
    So here is my OPTIMAL plan, LOL :
    I will pay the sales tax from 30K(no way arround it)))).
    Than i will show that 70% of the money were transfered to bisness owner(my paypal history account will be the proof, which is really truth, don't want IRS to make me pay income tax from his part LOL)
    Than will show the inovoices for SEO/marketing, domains, hostings, content, design, etc...(which in reality are for other projects, but how will you now?)

    and in result i will have 1K of profit, which i will transfer to bisness bank account and will pay corporate tax only from this amount,

    Pretty logical to me. Any recommendations/suggestions/expiriences?
     
    Last edited: May 24, 2011
  8. Coolof

    Coolof Registered Member

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    Guys any ideas?
     
  9. Coolof

    Coolof Registered Member

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    any useful info? besides just trolling?