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65hoss
06-16-2003, 10:29 AM
Don't forget about quarterly tax payments. Today is the day.:cry:

leadarrows
06-16-2003, 10:34 AM
Thanks you saved me.:D

rodfather
06-16-2003, 06:57 PM
And I was having such a great day so far:angry:

Jimbo
06-17-2003, 03:13 PM
Im confused. My accountant is a worthless piece of poo.

I called him and informed him that he had my quarterly tax forms in his files, and i thought I was late so we better get them filled out and mailed. He asked if I was talking about corporate or personal returns? Hell I dont know I thought it was personal but maybe since its handled throught the corporation its corporate?????????????????????????????????????????????????????????????????????????????? I can handle everything but the payroll and taxes, and my accountant is too incompetent to help or call me back.

Can anyone clarify as i am really stressing out that I could be overdue. FYI-I have not taken any money out as payroll this quarter...if that has any bearing.

Jimbo

NCSULandscaper
06-17-2003, 08:08 PM
My next payment is due on July 15th. So i still got a while.

Jimbo
06-18-2003, 12:20 PM
Finally got a VM message from my accountants secretary (wife). She said nothing was due until July 31st. Man I hate relying on other people.

Jimbo

Green in Idaho
06-18-2003, 04:35 PM
The July 31 due date is for payroll withholding returns. Form 941
The June 15th is for individual (personal) estimated tax payments. Form 1040ES

If you are an employee of the company and take ALL of your compensation as wages = no worry.

If you get some wages and some 'dividend' income (profit flow-through) from your company then you may have to consider the estimated tax payments....

If you are a sole prop, partnership, LLC, or S-corp you need to consider estimated payments.

smburgess
06-20-2003, 10:53 PM
Don't deal with them, thank God.

Jimbo
06-23-2003, 05:46 PM
Thanks Green in Idaho-

I have an LLC corporation and take all payment through the company as payroll, but my accountant appearantly has stopped doing the estimated payments. Does this make sense? You had stated that LLC's should consider estimated payments.
Please elaborate, because I thought that since taxes were taken out through payroll estimated payments were not needed.

Jimbo

Green in Idaho
06-23-2003, 06:37 PM
As the owner of an LLC you can either be

1) an employee (payroll with withholding) to suck all the money out in the form of wages= no estimated payments since tax withholding occurs with each paycheck.

Or
2) taxes as a sole proprietor. All your profit is taxed on the schedule C and most likely estimated payments are required (if you earn a taxable profit for the year). Note: some states do not allow this method.

There are exceptions to estimated payments like having a Net Operating Loss from prior years, or taking heavy depreciation expenses to wipe out the taxable profit.

*********************
So as you are on payroll with the LLC estimates are most likely not necessary. At the end of the year, you look and see "hey there is still $4,000 there as a profit." Boom! Christmas bonus check. 100% goes to payroll = no need for estimated payments provided you don't have other sources of large income and the payroll withholding is accurate.

A situation where an LLC employee needs to make estimated payments. Salary is $36,000 in payroll. but the LLC will have net taxable profit of $XXX even after deducting your payroll. For example if there's $20,000 left over, that would 'flow-through' to you and be subject to S.E. tax of 2,869= should have estimated payments in ADDITION to payroll withholding.

There are two possible streams of income_ the wages (withholding) and _ flow-through (estimated payments). If you play only in one stream do pay that way. If you use both streams you have to pay both ways for an LLC.

*********************
If your total take is more than$50,000 in wages, you may want to consider S-corp over LLC to save taxes. Saves a little in employment taxes.

TurfPro
06-23-2003, 07:24 PM
Green in Idaho,

1st off I'd like to say I appreciate your input to these business related threads. It's the one thing I absolutely hate about being self-employed,,ugh all the paper work.

My question, how small of a business can still benefit from making the change from Sole Proprietor to LLC? What are the pros and cons to each? (in a nutshell)
Thanks

Green in Idaho
06-23-2003, 09:13 PM
The benefit from sole prop to LLC is only liability protection. A singler owner going to LLC is going to be taxed EXACTLY the same way. Same forms, same tax rates, same everything for tax purposes.

However, some states do not allow single members to be LLC though-- most do, but a few do not.

So for liability protection even the smallest one-man operation doing 5 accounts can benefit from it.

The down-side is the cost. It costs to file the Articles of Organization. And some states require annual filing fees. But if it saves your bacon on one incident 4 years from now it will be well worth it.

Other considerations are what you have at stake and what your risk is.

Again LLC law is based on state law, just like corporate law so it is different from state to state.

Generally, I would recommend going to LLC if your income is less than $40k, or if you have some risk (mower throwing rocks, vehicle accident) or if you have significant personal assets to protect.

If more than $40k of income go with an S-corp (pay self a reasonable salary and pull most as nonwages).

BUT now with the recent tax laws changes there are other planning opportunities. Sorry, I have to reserve that info though.

TurfPro
06-24-2003, 05:00 PM
Green in Idaho,

Is it wise for someone to prepare their own Taxes via programs like Turbo Tax? Are all the tax laws updated and accurate on these types of "do-it-yourself" tax programs? The reason I ask is I'm dissatisfied with my preparer and am wondering if doing it myself would save me money?

Thanks

Green in Idaho
06-24-2003, 06:31 PM
Is it wise for someone to do their own tax?

It is wise to LEARN as much as possible about your taxes. Turbo Tax can help do that for you. However Turbo does not replace the professional knowledge of a tax pro.

Remember Turbo is a TOOL. You using Turbo is the same as a homeowner buying the tools to do their own lawn. Yes, they can usually accomplish it but it takes them longer to learn how to use the hedge-clippers without butchering the shrubs, it takes awhile for them to use a ZTR, the lawn looks bad but it's mowed, and then there is the knowledge of lawn CARE. Does the homeowner know how to treat grubs, or powdery mildew. Usually not, but of course they can read to find out or they can go to a Web site like this one and learn some too. But that takes TIME. They might screw up and end up buying a new tree to replace one, or have to fix other mistakes. Just like you learning to use Turbo and learning the tax laws in order to use that tool properly. Do you have the time? Does the homeowner have the time? Or does it work best that a homeowner knows some about lawn care, like the knowing the leaves should not be brown and to call a pro. How about a homeowner buying a software program to design their new landscape? The software is a TOOL and yes it can tell shade/sun plants and how big the shrub gets--- but.... what will the result be?


Are all the tax laws updated?

Yes, Turbo and others do a very good job of updating their programs every year. They have to comply and meet specs set by the IRS in order to use e-file with the IRS. However, occasionally the programs do have glithes. And Turbo has been good at correcting the glitches w/updates. The programs seldom let you do something wrong, but they easily let you SKIP over something.

As far as being unsatisfied by current preparer.

I can understand that if you are using an inexperienced tax preparer. And many experienced preparers know just the tax return and nothing more. They are there to enter your numbers on a page NOT to advise you. Most people think of H & R Block when they think tax preparer and MANY small business people go there. But realize Block has a large employee turn-over and they teach new employees the basics and the software does most of the work. Again, their software is a tool too. And many rookie preparers are struggling with the TOOL and the procedures. Inexperienced or recent tax preparers are NOT going to be able to give you good advice for tax planning, business planning and in most cases they are likely going to miss things specific to your business. There are a few excellent business preparers in the Block organization and other similar firms. Problem is they are usually avail only in Feb-April. And they are a SMALL percentage.

Will doing it yourself save you money?

Probably not. It will take you many many hours to get to efficient tax work. You could be spending that time mowing and making money instead of trying to save money.

If you were framed for a crime, you COULD represent yourself in court, right? You can read the laws, etc. And 5,000 hours later you might do as well as the $150/hr attorney. But without the experience of previous trials, you will be swimming upstream. Is is worth it?

Instead I suggest finding a new accountant. ACCOUNTANT not tax preparer. An tax preparer is to accounting as a neighor kid mowing is to professional horticulture. They just do the task, and not much else. As you business GROWS, you will need business advice, consulting and guidance. Be eager to seek it and pay for it. It can be very inexpensive when all is said and done.

Accountants can be CPA, non-CPA, degreed, nondegreed or just a lot of experience. When your customers look for lawn care, do they look for a license? A horticulture degree? Lots of experience?

Look for someone who works with contractors esp LCO if possible. Include this as a question, "Can you tell me about the fuels tax credit?" If they tell about the requirements and how you can get a refund on the tax you paid for your equipment fuel, continue interviewing them. IF they stumble on it, keep looking for another. Ask other business people you know in your area, and then interview a minimum of 3 prospects. Just like getting bids. And don't automatically go with the cheapest.

In addition to using an accountant-- pick up a book at the bookstore for something like Ernst & Young Tax Guide, or Kiplingers' or H& R Blocks. They are excellent references for you to answer some questions. Or take a class. Plus if you are well versed, you will be able to help your acct, ask the right questions, understand what they are talking about, etc. If you like, do a Turbo return at the end of the year and then have an acct do one for you and see if they save you money. Keep track of the time to do Turbo. You will know in a short while the VALUE of a good accountant.

Your business is based on specializtion. You specialize in lawns so the homeowner can specialize in their career field. Allow others to specialize for you to accomplish those things you need done. But always utilize quality and excellent service just like you offer your customers. It is a ladder; you are the middle rung.

TurfPro
06-25-2003, 07:53 AM
Great Reply,Thanks !

I can honestly say that my motive for trying some other way to prepare my taxes,in this case Turbo Tax,is NOT to save time ,,hehe, I KNOW it would take me hours upon hours to do that.
It's to save money,,,not in preparer fees,but in Taxes. I understand what you are saying in the difference between a Tax Preparer and a CPA,,that makes sense. The problem lies in finding someone who understands the needs of a small business.

Thanks again

Jimbo
06-25-2003, 08:18 AM
Thanks Green in Idaho- I dont know your background but you seem pretty smart when it come to this topic. Thanks a million!!!!


Jimbo

Green in Idaho
06-25-2003, 02:49 PM
No problemo. I enjoy the tax stuff. My background is landscaping previously and accounting currently, much like a couple others on here. Those two element go well together.


As far as saving $ on taxes: My #1 recommendation is Keep good records-- clean, organized and easy to understand.