Offline IM Consultant Taxes

6 replies
HELP!

Anyone in Texas doing offline internet marketing?

I've been working under a DBA.

How do YOU file?

How often are you filing your Federal?

Did you get a state sales/use license?

What and When are you charging taxes?

Supposedly I've been doing this all wrong for awhile now and yea...needless to say I am clueless until after Christmas when I can get this all sorted out with my CPA/Accountant who obviously has no idea what to do when it comes to internet marketing services. :/

Thanks in advance for the help!
#consultant #offline #taxes
  • Profile picture of the author zogman
    Make sure you keep close track of your expenses. Take the gross amount you make minus expenses and get a total. Then subtract 25% from that and keep it in a separate bank account. Use that 25% to pay your quarterly taxes. This is a good rule of thumb. You can always pay or refund the difference when you do your annual tax return. While im no accountant, this has worked well for me.
    You don't need a sales/use tax permit for providing services as far as I know.
    Hope that helps.

    Your Fellow Texan
    Later Y'all
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  • Profile picture of the author John Pawlett
    Originally Posted by smallbusinessfire View Post

    CPA/Accountant who obviously has no idea what to do when it comes to internet marketing services
    Some good practical advice from Zogman whatever country you are in.

    I would get rid of your CPA and get one that does know what there doing, they are also a great source of leads!

    Kind regards

    John
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    • Profile picture of the author Steve S
      I'm in Dallas, a CPA and have been involved affiliate marketing for some time now. Operating under a dba where you file a schedule C on your 1040 is the last form of business organization I would use and something that I strongly urge my clients not to do. There are several reasons. Among them are self-employment taxes, audit risk and exposing your whole life to the IRS in the event that they audit your business.

      If you wish, you may pm me with you email or telephone number and I will be happy to help you identify some basic issues you should bring up with your CPA.
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  • Profile picture of the author bigredrassler
    Definitely find a CPA who has experience with IM. As far as charging taxes, I can't think of a single state where services are taxable, but check with your state laws, federally, they are not.

    And I would switch from a DBA to at least an LLC, if not an S-Corp, more tax benefits, and less risk, as a DBA or Sole proprieter, you are 100% liable for your companies debts, as an LLC, S-Corp, or C-Corp, the company is seperate from you and you can not be held accountable for the company's debts, only the company can, it can save your bacon in case of lawsuit.
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  • Profile picture of the author derekmichael02
    LLC makes it easy, but at the very least, get the IRS whitepapers for small businesses. They make it surprisingly user friendly and easy to read.
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  • Profile picture of the author Creativegirl
    You want to contact the comptroller's office or search online for the statues. In Texas if you provide anything in writing (print or digital) it is taxable. Graphic design and web design are taxable. Content creation or generation would be taxable. Consulting where you are providing information verbally is non-taxable but as soon as you create something in print or digital they get you under a different statue.

    You'll also need to get the tax rates for all the cities as it varies. For example, the cities around Austin are not all the same. Of course anyone out of state is all non-taxable.

    Calling the comptroller's office and speaking to someone knowledgeable can be invaluable. They are there to help but be careful you can get someone who gives you wrong information. The man (if still there) is the best. They can reference the statues for you as well as letters they have addressing similar questions.

    Yes, get a resale license and file quarterly sales tax reports. Again comptrollers office or website for help. If annual sales tax is under a certain amount you can do it annually. On this you have to disclose any taxable purchases that you did not pay tax on, doesn't matter if purchased in TX or out of state. I make a copy of the receipt and stick in the quarterly folder along with a copy of my receivables so its all in one place for when I need to do the report.

    Easy way to set up files for your receipts is to go by the line items you'll use or need for Sch C and A. I cannot tell you how much time that has saved me. There used to be a site like NASB or something that had a very detailed explanation of all Sch. C line items. I think they sell it now. Anyway, it is invaluable!

    You definitely want a good "small business" accountant. I can refer you to mine in Georgetown if you're local to Austin. It really helps to take the pressure off and their cost is nothing compared to what they save you.

    Hope that helps.
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