Looking for some advice on taxes as an internet marketer

Trent Brownrigg

13 years ago

What do you mean? It differs every year. I don't pay during the year, I just do it all at tax time.

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Chri5123

13 years ago

Originally Posted by Trent Brownrigg

I am a full time internet marketer and have been for years. My entire income is made online and I have plenty of business expenses, so I don't know how that works with taxes. Every year I have someone else do my taxes but this year I am trying to decide if I should just do them myself or not.

So I have a few questions for any other full time internet marketers that do your own taxes...

1) What program do you recommend to use? I've heard about turbotax for years but I am not sure if that's the best thing for my situation or not.

2) How difficult is it to actually do them yourself?

3) Is it worth doing myself or should I just keep having someone else do it?

4) What would I need? Obviously turbotax (or something similar) along with my income and expenses, but is there anything else?

Also, what are some things that you deduct each year? I have certain things that I always do but I could be missing some, so it would be nice to see what others do.

Thanks in advance!

Braver man than me!

I have thought about doing this and would have all the same questions.

However tax time is coming up for me as well and I just outsource to an accountant.

For the sake of $200/ $400 it is SO worth it!

That said I think once you go through it all it is not that difficult it just takes time.

Chris

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Tsnyder

13 years ago

My best advice would be to let people do what they do best.

You might think you're saving money doing it yourself but
if you're earning a full time income I doubt you'll save anything.

Not only do you run the risk of making a mistake that will cost
you money in lost deductions or additional taxes and penalties,
you're also costing yourself money by spending time focusing
on something that is a non revenue producing activity.

Focus on your business... outsource professional services to those
who focus on them.

Tsnyder

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Dave Rodman Banned 13 years ago

If you're making a few bucks, then it's not difficult at all to just do a Schedule C and call it a day. You'll pay self-employment taxes on your profits, but it's simple and easy. I don't think that's really too difficult for your average person. That's what I did for the 1st couple years.

Assuming that you work full-time and earn income on the side, you might want to consider upping the withholding from your day job so you don't get socked at the end of the year for taxes. That of course is assuming you're making more than hobby money. If you're making good money, you should be paying taxes as you go.

Once you're making decent money, you should get a CPA. You'll need to start taking a paycheck, paying FICA, filing quarterly returns, etc. Plus, it's just in your best interest at that point.
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genietoast

13 years ago

If you plan on doing taxes yourself, I recommend you use Turbo Tax. They're really good about walking you through the entire process, asking you questions, showing blocks where you can fill in for expenses like advertising, etc.

Plus, they help you find the best deductions. It takes some time going through screen by screen, but it's very well organized.

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Per Action Rob

13 years ago

Doing your own taxes as a business owner is about as bad a move as you can make. I lost close to $80,000 in deductions and writeoffs my first couple of years because I decided to do them myself.

Not to mention the other pile of cash I lost by not understanding a ton of other loopholes I could have taken advantage of with the right business and asset structuring.

A good CPA and tax attorney pay for themselves, maybe you don't make massive income right now but that doesn't mean you won't overpay significantly.

The government loves people who do their own taxes and McTax joints like H&R Block. Those are fine if you work for the man, but when you work for yourself it's a whole different ball game.

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Adam1981

13 years ago

Originally Posted by Per Action Rob

Doing your own taxes as a business owner is about as bad a move as you can make. I lost close to $80,000 in deductions and writeoffs my first couple of years because I decided to do them myself.

Not to mention the other pile of cash I lost by not understanding a ton of other loopholes I could have taken advantage of with the right business and asset structuring.

A good CPA and tax attorney pay for themselves, maybe you don't make massive income right now but that doesn't mean you won't overpay significantly.

The government loves people who do their own taxes and McTax joints like H&R Block. Those are fine if you work for the man, but when you work for yourself it's a whole different ball game.

This ^^ all over.

If your IRS are anything close to as anal as the british inland revenue then you should get a professional.

Mine paid for himself years ago. Set me up with an offshore company and account that allows me to legally pay about 6% of my income in tax - when I should be paying close to 50%.

Billy Connolly told a joke about the tax man years ago -

"What do the inland revenue and an emu have in common?"

"They can both stick their bill up their a*se"

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Trent Brownrigg

13 years ago

Thanks for all the replies thus far!

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GuruGazette

13 years ago

Trent,

I've always done my own, by hand, and by paper no less

This year I'm probably going with Turbo Tax or an accountant because the IRS finally forced e-file. I usually devote one entire day so I can check and recheck figures. My mom was an IRS tax examiner when she was alive so that made me confident enough to do my own.

A research project this year combined with a screw up last year has shown me the light though... I've missed out on tons of deductions over the years. I'll probably start looking for a professional to hand it off to in the near future.

BTW: Any of you who have kids as deductions... MAJOR BEWARE once they're grown and gone.

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Brendon Zahrndt

13 years ago

Trent,

The best advice I could give you is go to a tax professional to answer your deduction questions.

I will tell you this, I have an online business and an offline business. I have used Turbo Tax for I don't know how long, and it is simple.

I will suggest you consider paying taxes quarterly, especially if you keep every expense receipt (and heaven forbid an audit comes you WILL need those receipts). The paper trail can become a nuisance.

Turbo Tax will help you with what you can deduct, expense, etc. It never hurts to go to a local CPA and have she/he take a peek. But as far as that program goes it is clear and concise and works just fine.

Brendon

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BDW

13 years ago

I say get a good accountant and be done with it.

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BlondieWrites

13 years ago

Unless you know what you're doing, I would use a tax person who knows how to deal with self employment. Otherwise, you could lose a lot of money or end up paying in when you didn't have to, etc.

I pay anywhere from $200 to $350 a year for someone to do my taxes. As I watch them work, I must say it's well worth the cost.

Tax laws change from year to year also, and if you aren't up to date, it could cost you.

Everyone's needs are different, so do what's best for your particular situation. Good luck!!

Cindy

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AdamSlade88

13 years ago

I've been a full time internet marketer for over 2 years now and I haven't paid a cent in tax.

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Tsnyder 13 years ago

Originally Posted by acur042

I've been a full time internet marketer for over 2 years now and I haven't paid a cent in tax.

That's nice... though meaningless.
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Kim Standerline

13 years ago

You know what

I'm going to go with the majority and suggest you stay with the professionals.
I tried doing my own taxes the first year I was online and it was awful, I'm hopeless at stuff like that.

My accountant has access to my PP and biz account and I just take any other receipts down to her in either a shoe box or a carrier bag (They are usually crumpled up covered in coffee stains etc )

She sorts everything, maybe asks me a few questions before she files, hands me something to sign then bills me for about 800 quid

best 800 quid I spend every darn year lol

Kim

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Trent Brownrigg

13 years ago

Thanks again everyone! I've got lots of stuff to think about now.

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bigbrian 13 years ago

If you are up for doing the entries you can grab a copy of Quickbooks or Quickbooks online and link it to a dedicated bank account for your affiliate marketing. Just use this account for expenses and getting payments. Then just review your transactions on a regular basis and mark what they are. It's farily easy because there is a category for most expenses and if there isn't you can create one using the wizard.

Come tax time though I suggest you go to an accountant. They are going to know exactly how to "show things" so they look right, get you additional savings and basically give you professional advice and assistance. People get thrown off by TurboTax because they think it's cheaper but you can get the same tax prep done by an accountant for the same price (sometimes cheaper). I prefer an independent accountant compared to HR Block and those mainstream places - you get more personalized service.

Also if you are earning money throughout the year via W9 and will be 1099 end of year you are supposed to pay estimated taxes quarterly. Depending on the amount you make will depend how much you should pay. A good rule of thumb is 35% of your revenue.

Brian
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Looking for some advice on taxes as an internet marketer

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