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View Full Version : end of year bank acct balance?


thes
11-02-2004, 04:40 PM
Obviously this is my first winter on my own. This question goes out to all of you accountant types...hahaha

I was wondering if I should transfer all the money that I know I'll *personally* need for household expenses from my business acct into my personal checking acct BEFORE Jan 1st???? Or should I leave it in my business acct and take a weekly draw as needed throughout the winter into spring???? I am not sure if this makes a difference with tax returns....and if it does, what IS the difference? Btw, I am a sole proprietor.

Thanks in advance

lawnMaster5000
11-02-2004, 08:41 PM
As far as tax purposes - it does not make any difference how you chose to hold your money. Since you are a sole proprietor it is all considered yours no matter what type of account the money is in.

Mdirrigation
11-02-2004, 09:09 PM
You need to get rid of all your money before the end of the year , email me and I will tell you where to send me a check . seriously You need to check with your accountant .

DanaMac
11-02-2004, 11:22 PM
If you were incorporated, as I am, you would want to get rid of a lot of it out of the biz account at year end. Even if it goes to you personally. It gets taxed at a higher rate for the corp as opposed to you personally. But there are rules for all that. Red flag if you make more in dividends than salary.

But you are a sole prop. so I have absolutely no clue. Seek advice from an accountant.

tiedeman
11-03-2004, 02:19 AM
basically once you have deposited money into your business account through the year it is already totaled up. There is no way to "get rid of it" for taxes.

DanaMac
11-03-2004, 09:51 AM
tiedeman - it gets taxed at different rates depending on if it is copporate profit or your salary. Or if you spend it on things considered "expenses"

bruces
11-03-2004, 10:02 AM
For tax purposes it does not matter. The money is yours whether it is in the business account or personal account.

The only way to make a difference is if you spend some of it for business purposes.

thes
11-03-2004, 10:12 AM
I will check with an accountant just to be sure...but I guess since I am a sole prop....deductions *will* be the thing that makes the real difference for me, as far as taxes go.

Thanks for all the info...it is much appreciated. :)

MMLawn
11-03-2004, 03:29 PM
As far as tax purposes - it does not make any difference how you chose to hold your money. Since you are a sole proprietor it is all considered yours no matter what type of account the money is in.


This is the exact correct answer and as A SP you have to pay taxes on the total anyway regardless of which account.