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  #1  
Old 09-25-2001, 08:56 AM
grassman50 grassman50 is offline
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Join Date: Sep 2001
Location: Michigan
Posts: 36
I want to know about paying taxes

Hi, i am new into the business of lawn care. I am 19 years old.I have around 25 or so weekly accounts. I guess you can say i make around $600 or so cash...weekly. How would i go about paying taxes towards this? Is it a good idea to pay taxes? Say I am making $10,000 a summer doing lawn care, how much of that would i have to owe for taxes? Is there a ballpark figure? I am starting to wonder if i should switch my major to an office job. my major is landscaping right now, and its starting to sound like im not going to be making that much money with taxes and stuff. Please help me out guys!!!! I would appreciate any advice. And for all you guys that plan on ripping on me by now just dont even write because i want some good, clean, honest advice, afterall, wernt you in my shoes at one time anyway?
thanks guys!!
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  #2  
Old 09-25-2001, 09:17 AM
HOWARD JONES HOWARD JONES is offline
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Join Date: Jul 2001
Location: MUSTANG, OK
Posts: 233
If you don't get any better detailed info than this, here goes: as I see it, there is no really good reason to not report your income. If you are in a real low income (if the 10,000 is your entire income for the year), you may not owe any taxes, especially since you can also depreciate your equipment, and in fact I've known people who got money "back" even though none was paid - kindof like a welfare program. (P.S.-I just looked at tax tables and this may be a thing of the past-looks like the minimum is 15%) You can even get rough figures from the IRS themselves, anonymously, or consult with a tax accountant - they could tell you instantly if 10,000 would have any tax liability. Now here's the kicker when considering "gray" areas - errors on reporting taxes are corrected by making up the money, with interest and sometimes a penalty, which is usually not more than interest; non-reporting is a felony "tax evasion". As far as how to pay towards it, you can get forms for paying quarterly estimates rather than waiting until year-end.
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Last edited by HOWARD JONES; 09-25-2001 at 09:25 AM.
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  #3  
Old 09-25-2001, 09:24 AM
bruces bruces is offline
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Join Date: Jun 2001
Location: Independence, MO
Posts: 648
Grassman,

First, if you are going to pay taxes, keep good records. If you have access to a computer get a program like Quickbooks or Quicken. Open a bank account for the business and deposit all income in the account and write checks for all expenses that you can.

Yes, it is a good idea to pay taxes if you really want to be a legitimate business. If you ever want to borrow money for equipment or establish credit with suppliers, the first thing they will ask for is copies of your business tax returns and or financial statements to show that the business has enough income to repay the loan.

You will pay probably 15% Federal income tax and 15.3% self employment tax on your net income after expenses. Remember, you pay taxes on the net, not the gross, so it is important to keep good records.

You need to contact a CPA or other tax preparer to figure out where you stand. If you wait until the end of the year, you will be in for a shock.
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  #4  
Old 10-07-2001, 11:21 PM
MATTHEW MATTHEW is offline
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Join Date: May 2001
Location: NE OHIO
Posts: 665
You need to make sure you are within ALL laws when running a business. You need a vendors licence,commercial plates on the truck, and you may need to charge sales tax and pay it. You need to file a 1040-A and use the schedule C. This form will show you how you get from gross sales to net profit and how much tax you owe.
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