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  #31  
Old 11-12-2012, 06:18 PM
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Originally Posted by Landscape Poet View Post
The estimate above I am sure somewhat accurate but that all is based off if your really figured your profit correctly. A CPA could help you figure all this out and most likely pay for themselves with your newness to all this. A couple things he/she can help you figure out for example, do you operate out of your home, IE is the equipment stored at home, is there a office area used exclusively for billing and customer mgmt issue etc? If so a portion of your home payment, expense associated with the home like insurance on the home, phone bill etc may all be deducted from your income. What about depreciation of your equipment? I have a feeling with your low gross that your profit is not nearly what you think it is and a CPA will be able to help your discover your true cost of doing business as well as save your from paying any more tax than you need too.
Don't forget meals and entertainment expenses along with advertising/promotion.

I think Cell phones are now a 100% deduction too. They change the rule on that and we used to only deduct a certain percentage, but I'm pretty sure the gov't will allow you to write off the whole thing now.

I like going out to dinner when it's business related, I can actually justify spending the money to go out and eat knowing I can ride it off on my taxes.

Here's another thing to consider also when comparing gross to net.

You might Net a certain amount, but if you look at the personal deductions, your actual Net is probably way better.

What I'm saying is that you get to deduct cell phones, office space, computers, gas, insurance, etc.... and if you had a job where you were paid by someone else, then you pay those expenses out of pocket.

So, if you Net 30k in a year, it's probably more comparable to someone who makes 45k-50k a year with a "real" job.

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  #32  
Old 11-12-2012, 06:20 PM
kynobi kynobi is offline
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home expenses

Excellent points. I definitely need some professional input on the accounting side. The mower, trimmer, blower, and hedge trimmer were all purchased new this year, but I do have an office space set up in my house and use a computer that I already owned. I also use an SUV that I already owned but maybe there are some write-offs in those and other items. Thanks a bunch.
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  #33  
Old 11-12-2012, 06:26 PM
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Excellent points. I definitely need some professional input on the accounting side. The mower, trimmer, blower, and hedge trimmer were all purchased new this year, but I do have an office space set up in my house and use a computer that I already owned. I also use an SUV that I already owned but maybe there are some write-offs in those and other items. Thanks a bunch.
Yes, definitively have an accountant help you out at least if you don't have them actually file your taxes.

If you use your SUV for both personal and business, then you would deduct the percentage of use for the business, either by mileage compensation, or the total cost to operate it each year. Basically whichever is bigger.

My smaller truck usually gets more miles than maintenance a year, so I deduct the mileage. And generally it gets used for 90% business related activities. Most of the time we use my wife's car for personal things.

My Dump truck generally gets more repairs and fuel, so I deduct the expenses.

But again, do get professional advice from an accountant.

Also, get a good accounting program such as quick-books. Makes keeping track of ALL your expenses a breeze when you keep up with the register.



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  #34  
Old 11-12-2012, 07:02 PM
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Deducting your mileage is huge, last year half the year the mileage rate was 0.55 cents a mile. Mileage deduction almost always outweighs the average cost.

And White you are correct in essentially considering your write offs as a benefits package.
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  #35  
Old 11-12-2012, 07:19 PM
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Originally Posted by Landscape Poet View Post
Deducting your mileage is huge, last year half the year the mileage rate was 0.55 cents a mile. Mileage deduction almost always outweighs the average cost.

And White you are correct in essentially considering your write offs as a benefits package.
Just remember you can't take mileage and maint deductions on the vehicle. Its one or the other. Also once you swith to itemized vehicle deductions you can't go back to mileage.
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  #36  
Old 11-12-2012, 07:35 PM
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Just remember you can't take mileage and maint deductions on the vehicle. Its one or the other. Also once you swith to itemized vehicle deductions you can't go back to mileage.
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Yep, learned that last year as I have always tracked both thinking it would come in handy as one year my true cost would outweigh my mileage. My CPA informed me that the mileage was still my best bet even though I had to have a computer replaced, a new set of tires, brakes etc on top of regular oil changes etc. Like I said it was fine as it still worked out better for the mileage even after all that.

Last year was a little silly though. I do not track my mileage by month, not sure about you guys, but the fed gave the old rate of .50 for mile for certain dates and the new .55 rate for mile the remainder of the year.
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  #37  
Old 11-13-2012, 01:19 PM
caseysmowing caseysmowing is online now
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I think you can easily gross 30k your first year but profit 30k is possible but you would have to be in the right market with very low overhead and bust your ass. I'm will be finishing up my first PT year in mid Dec and I think I'm going to be at around 25-30k gross. Profit negative alot because of the amount of equipment I've bought. But I'm happy with where I'm at.
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  #38  
Old 11-13-2012, 01:24 PM
caseysmowing caseysmowing is online now
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Question: Mileage VS Expense You can't switch back and forth, so can you have one on mileage and one on expense or do they both have to be the same? Thanks I didn't know you couldn't switch them from year to year.
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Cheetah 61in 34hp
Vride 48in 24hp
SFW 36in 16hp
Trac vac loaders and bagger
Billygoat 1302sp blower
Stihl handhelds/322l & 580BTs husky
2003 GMC C4500 14ft dump
1998 Chevy 1500 Z71 with 8ft EZ dumper
2003 GMC W3500 18ft box cabover
6.5x12 landscape trailer
Jrco leaf plow
Part time for now and solo for now.
Third year!
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  #39  
Old 11-13-2012, 01:56 PM
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Both have to be the same. Unless you are operating 2 completely different companies.
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  #40  
Old 11-13-2012, 02:09 PM
caseysmowing caseysmowing is online now
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Ok Thank you!!!
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Cheetah 61in 34hp
Vride 48in 24hp
SFW 36in 16hp
Trac vac loaders and bagger
Billygoat 1302sp blower
Stihl handhelds/322l & 580BTs husky
2003 GMC C4500 14ft dump
1998 Chevy 1500 Z71 with 8ft EZ dumper
2003 GMC W3500 18ft box cabover
6.5x12 landscape trailer
Jrco leaf plow
Part time for now and solo for now.
Third year!
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