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How do you pay income taxes on money/income received from an internet based job?
Filed under TaxesJan 14
dariaakasha asked:
In other words, if you make money with some online / home business type thing, how do you pay your taxes on that income ? is there a way to caluculate how much to give the IRS so they dont bill your for it later or what? because i kno at ma n pa places with a few employees they have a chart where they can do it by hand so i was wondeingr is it the same thing?
cutyourdebt.infoTagged as: Income Taxes
7 Responses to “How do you pay income taxes on money/income received from an internet based job?”
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dch921 said on January 14th, 2009 at 4:31 pm
You would have to file self employed. The IRS has basic tax tables to use were you can figure up what tax bracket you will be in by how much you make. You can pay the IRS through out the year to avoid a big tax burden at tax time.
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imagine_108 said on January 17th, 2009 at 10:56 am
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you know who would be a really good person to ask…a person from the IRS
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cramsib said on January 18th, 2009 at 5:11 pm
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hopefully you make money in your business..you will need to file a return for the business..you have to otherwise you would be breaking tax laws and the irs and/or state tax authorities will eventually want it + interest + penalties..the first step is to understand that you will owe taxes on your profits..i assume the business is profitable..
i don’t know if you need a dba ( doing business as ) entity to file the return. you have to check with the irs or some cpa website or irs.gov filing a business return should be done by a prefessional cpa. some people do it themselves. some prefer the peace of mind of having the return prepared professionally. i lie in the second camp. so tally up your total sales for the year, your expenses by category and go see your accountant. if you don’t have one, try the big franchises like h&r block. they have competitive tax preparation fees for smaller business and individual they’d like to have as long term customers. it’s essential you file because if one year you have a net loss, then you get tax breaks for the following year. good luck.
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Egan said on January 19th, 2009 at 9:08 am
You can file your taxes as a sole proprietor or single-owner LLC. Turbo Tax and Block offer tax programs that can help you decide whether to do your taxes yourself or hire an accountant. The one rule to always remember when deducting taxes, “Be creative, Be aggressive”
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Tomk said on January 21st, 2009 at 7:46 am
Be sure you kept all the receipts for everything you purchased related to your business. Keep receipts for any expenses (shipping you paid, etc.).
Keep detailed records of the payments you received. You must keep these all year long.
Then you complete Schedule C to figure the amount of profit/loss you claim on your income tax form.
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Judy said on January 23rd, 2009 at 9:19 am
Unless you are considered an employee and taxes are taken out (which probably will NOT happen), you’d file that income as self-employed using a schedule C or C-EZ, and a schedule SE. Keep good records of any income and associated expenses.
Income tax will be calculated the same as if you were an employee. You’ll also be paying self-employment tax, which is for social security and medicare – you’ll pay a higher rate than an employee though, since you’ll have to also pay the employer’s half – it will work out to around 14% for that in addition to whatever income tax you owe.
You should also make quarterly estimated payments using form 1040ES since taxes won’t be withheld from your paychecks.
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hrbie77 said on January 25th, 2009 at 6:34 am
I would say your best bet is to find your self an accountant that specializes in home business tax stuff…
There are such accountants and only they know the correct way to go about things. As just a regular accountant or cpa does not know all the stuff involved with home biz deductions and right offs etc…There is a lot of info and help available to people involved with home biz’s… as long as you have attempted to make money with a home biz, then you stand to gain in one way or another…
I highly suggest finding someone who specializes in home business tax stuff…Maybe begin with an online search, or look in your phone book etc….
Good luck to you!
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