Taxing a negligible income?

[FeartheDeere]

Hey guys, I've been thinking about taxes lately and whether I should do them. I only grossed $9500 this year on my lawncare business, and have so far netted about $4500 for the 2002 season...Is this worth taxing? Nothing was written out to The Mean Green Cut, checks were all written out to my name and a lot was paid in cash. In record "The Mean Green Cut" hasn't made a single cent yet, but I have. should I just chalk it up and go with it? Thanx...and please don't slam me too hard on this one if you have strong oppinions! hehe.

Thanx

[Scaper-S2k]

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It really depends on how well you want to sleep at night! What you're talking is not a huge amount. Legally you should, and you should be starting a paper trail for your biz...but you are very early in the stage. I do recall a minimum limit before filing, but I could be wrong on that.

[dancom]

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by law you should claim everything you made. i waould talk to a tax person. did you ever wonder if anyone from the irs reads these forums.

[cole1980]

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Fear,
If you have been written a check for your services, you are in line for IRS audit if your customer claims it on there taxes for a writeoff and they get audited, then IRS will come to you for payment, at least. I am not sure if they would or could prosecute you, but it is illegal.

[Phil Nilsson]

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Sales less cost of sales = income subject to income taxes

[grasshopper]

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Wow, this all relates perfectly back to what others and myself have said about 16 year olds not knowing half of what they think they know. Fear, at this point you better file for taxes b/c you just admitted everything publicly on the internet. That is a question you should have asked someone privately, but to display that on the internet like that was not smart. Like Dancom said, you have no idea who all of these people are on here and who is reading this forum. Now that you have spilled the beans on your company and its earnings, it's not worth risking your business over a very small amount that you would have to pay in taxes. Trust me, if you were to get audited by the IRS and they found you guilty of tax evation...it's nothign but a long uphill battle fo rhte rest of your life to get them off your back. They will check every cent you earn for the rest of your life. The IRS my friend is no joke and they do not take any amount of tax evation lightly.

[Bobby D]

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Oh boy, the cats outta the bag. Maybe you could convince Mr. Admin to remove this whole post right away. Ouch!

[Phil Nilsson]

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Hate to make it a "double play" but what about sales taxes collected from customers for services rendered? ... ouch!

[FeartheDeere]

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Hey guys, me and my dad were most likely going to do them anyways...I wanted to get your response. I've come to the conclusion that if my goal is to be a professional, I should act like it. And as many of you have pointed out, it's not worth the extra bucks to be hounded by the IRS. grasshopper, try not to make me feel two inches tall as many adults do although you may be right. But hey, I never said I knew everything! That's probably why I'm here to get you guys with more experience advice.

Phil, I haven't charged any sales tax yey. In fact, I haven't really thought about it...is there anything I need to do before I start charging sales tax?

Thanx all

[Scaper-S2k]

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Hello guys, he hasn't broken any rules 'really' until this upcoming April 15. And even then he can file an extension. Granted he may get a small late fee for not filing quarterlies....but not enough to fill up a tank of gas barely.

You CAN file taxes only on April 15 with no quarterlies....of course, there will be late fees, but for the money spoken of here...not enough to sweat. Actually, it would be cheaper to pay the late fees than pay the accountant every quarter!!

The IRS isn't hunting down young men looking at a NET of $4500. You guys act like he's going to prison!!

It's not THAT bad, and he can easily fix it. I'm not saying don't pay your taxes, you must start, that's a given. But I am saying that this thread is not that horrible.

Fact is, he probably wouldn't even owe anything anyway with the figures given.

[Fvstringpicker]

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Kev, the way the IRS enforces the tax owed by minors (no offense) is to make their parents/guardian responsible for filing a return. I wouldn't worry about the income tax on $4,500 but where they're going to gig you is self employment tax at 15+%. At any rate, you're going to need to file.

[BergLawnCare]

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G-man i don't know how it is in other states but here in Pennsylvania we do have to charge a sales tax on services such as mowing, leaf clean ups, shrub trimming,etc.... if you have not checked into it it might be worth you checking in to. I know here there are certain services that we have to charge sales tax and others we do not. And personally the way it is written up is nonsense and can be quite complicated.

[CCLS]

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Something that you might want to look into. In Iowa you must charge state sales tax on services including lawn services. If you are making money from these services, you are responsible to collect sales tax. If you file income tax papers deducting your equipment and expenses for the company, then chances are the state will wonder why you haven't turned over the sales tax you were supposed to collect. I'm sure this varies state to state, but in Iowa you must collect sales tax.

[CCLS]

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Yah I remember Brandstead Gary. Vilsack is worse. The dip has his head up so far up his @ss that he can't think straight.

I have been adding sales tax to all my jobs this year. On my contracts I have the price per mow and right below it I have
+Sales Tax. When I do my billings I separate sales tax and services preformed. I only paid sales tax quarterly this year. I really should have had to pay it monthly because if you have more than $1,000 per month in gross sales you need to file monthly in Iowa. No one said anything so either did I.