Posts by Henry Edwards33

cosmictinker24 said:I’m asking because I read somewhere that it’s just a turnover, some kind of independent contractor setup...
One year, we actually submitted documentation for our royalties, and they didn't even bother to take them into account... so... yeah...

Look, if you aren't legally required to report something, you don't have to send it in.
You only report what's mandatory. If you decide to start reporting those "optional" bits of income, then you have to be consistent and include everything—like dividends, interest from your savings account, and so on. It’s basically an all-or-nothing deal when it comes to non-mandatory income.

Personally, I don't report my dividends because it just bumps up my tax liability, and besides, they've already been taxed at the source and reported via a W-2 by the payer.

Richard Howard55 😘

I've decided I’m sticking with fighting those exchange rate discrepancies because, honestly, anything else feels wrong. It’s just bad practice.
Your confirmation basically tells me I’m doing exactly what I should be doing—and if I don't get some clarity soon, I might actually lose my cool. 😬

Can someone explain why exchange rate differences aren't a thing for sole proprietors anymore?
A colleague just told me her advisor said she can't record exchange rate gains or losses during the acquisition phase because there’s always going to be some positive or negative fluctuation by the time the actual payment happens. Now she's saying the whole accounting setup needs to be overhauled.

Why did this change, and what’s the new way we’re supposed to handle this?

I don't have the Sales module.
On my end, everything just flows through the IRA and goes straight to expenses.

ruggedlynx63 said:Exactly! The 20th... 🤦

What absolute idiots 🤦

Who am I supposed to bill for all the hours I wasted trying to file forms because the IRS website decided to crash?

🙂

I don't see any reason to have a separate tax account for people earning an income. Our paperwork is already such a bureaucratic nightmare as it is; there's really no need to make our lives even more miserable.
But hey, if someone actually enjoys that kind of headache, be my guest. 😁

Joshua Wright2 said:Try walking into a Chase branch and asking for an interest-free loan; you will quickly see how they respond. I am not saying I agree with capitalism—heaven forbid—but it is currently the economic system we all inhabit, and its fundamental mechanism involves accumulation and the creation of surplus. Corporations are established specifically to operate, earn, and generate excess. While lending money without interest is theoretically commendable, it isn't in the spirit of capital formation. Even if you decide to give something away as a gift, the government will protect its interests and say, "Fine, go ahead and gift it, but I still want my cut of the sales tax and corporate income tax." At the core of the matter, whenever a corporation is formed with a specific owner, it must be understood that that individual is not the sole owner. If one looks realistically, the state effectively holds at least a 50% stake in that entity. This is because more than half of what an entrepreneur earns will eventually go to the government through various taxes and contributions. The state is essentially protecting its own equity, its sales tax, and its income tax... in essence, its share in the business.

If we are talking about different periods, then fine: first pay back your own loan, and then lend from your surplus. However, if you are simultaneously taking out a loan with tax-deductible interest and then lending that same money interest-free to other companies, you are effectively stealing a slice of the government's cake, as you are reducing the profits that rightfully belong to the state. I am unsure what you find illogical about that. It is similar to other legal precedents in the tax code; for example, you cannot claim tax-deductible depreciation on an asset that does not, or cannot, generate sufficient revenue, even if it is being used. You cannot simply gift items from your inventory unless they are given to partners from whom you expect a significantly greater economic benefit "tomorrow" through the purchase of those same products... and so on.

Look, even if I get where you're coming from and actually agree with your point, the real question is whether anyone should even bother asking.
Logic is such a subjective thing—I learned that the hard way—and my version of what makes sense doesn't have to align with yours.😉

I once had an IRS agent try to lecture me using her own twisted logic, so I just laid out mine instead. We ended up being perfectly fine.😬

It feels like a shot in the dark—I suspect interest will still be applied to loans taken out by a sole proprietorship since the business and the owner are legally the same entity. They’re essentially inseparable. That’s exactly why people usually suggest that owners just stick to personal loans instead.

Laura Castillo6 said:Let's just set the whole sales tax debate aside for a second. I suppose you could argue that I’d end up with an invoice reflecting Spanish taxes, but my real headache is why the "experts" in this field keep insisting that I shouldn't have to pay anything at all. Look, if someone over in Spain issues an invoice without tax, that’s on them, not me—I’m not looking to get involved in their accounting mess since the receipt itself is perfectly valid.

Anyway, there is no way this should be interpreted differently every single time. It feels like that $70,000 threshold rule is being twisted and bent to fit whatever narrative someone wants to push at any given moment...

It isn't a matter of interpretation. Once you register for a VAT ID, you've essentially waived the option to pay foreign sales tax on earnings up to $25667.

It’s pretty straightforward—up to $25667, you get to choose whether you want to deal with overseas sales tax or opt for a US VAT ID and handle everything through our system.
Once your revenue hits $25667 over a two-year period, you have to get that ID and start reporting and paying taxes here.

As for who interprets what, you can argue about that all day, but until someone gives you something in writing saying you don't owe anything, you aren't getting any peace of mind. And let's be honest, you won't get that in writing. 😉

Words are cheap, especially around here.

Justin Myers7 said:From what I’ve gathered regarding this exact scenario, you don't need to worry about paying tax on the acquisition of goods up until $25667, but when it comes to acquiring services, you definitely have to account for and pay the sales tax.

It really comes down to looking at each case on its own merits.
Since there's a valid Tax ID on file for John, the responsibility for calculating and paying the sales tax falls within the US.
If he didn't have one—which could happen up until $25667 the acquisition—then the supplier would have to charge their local sales tax, and he'd just pay it directly on the invoice.

Ultimately, it's up to the supplier to verify if that Tax ID is valid and then act accordingly.

Laura Castillo6 said:Anyway, let me get back to my own situation.

I bought some goods worth 25 $0.00.

I got an invoice that didn't show any sales tax and didn't even have a "REVERSE CHARGE" note on it.

Since I'm not part of the regular sales tax system—I'm just running a small business—I have a tax ID that I applied for because the folks at the IRS told me I needed one if I wanted to do business with other US states.

JPMorgan Chase gave me one answer, then some tax inspectors told me I didn't need to pay, while other tax inspectors told me I definitely did.

Does anyone in this country actually KNOW if I need to pay?

And what specific document is used to make that call?

What would have happened if I hadn't gotten that tax ID? Would I even have been allowed to buy the goods in the first place?

You have to. It's a given.

Quincy:

And what specific regulation determines that?

The Sales Tax Law covers it.

Quincy:

What would happen if I hadn't grabbed a tax ID? Could I even buy the goods?

They’d just tack their sales tax straight onto the invoice. You'd end up paying it anyway, just directly to the vendor instead of handling it through your own tax filings.

Charles Stewart69 said:I mean, who actually said you absolutely have to file that small business tax paperwork by the 15th? That's not really how it works for me; I just bundle it in with my regular employee payroll filings. Sure, those self-employment contributions are supposed to be settled by the 15th, but honestly, I've never heard a single soul complain if you get ahead of it and pay on the 10th or even earlier. So, if the 15th lands on a weekend, it doesn't really matter. Before they started linking those small business taxes directly to the main payroll filing, I’d usually just take care of them around the 10th or 12th of the month anyway.😉

p.s. Trying to grab two rabbits at once usually just means you end up with none.

That’s easy to say when cash flow is steady, but when things get tight, having those payments hit on the 15th is a real headache.

Since they don't lump the self-employment taxes in with the main payroll, I usually just pay them around the 10th or 12th of the month. 😉

Mr. Perfect 🙄

p.s. fortune favors the bold, I guess.

Yeah 🤣

Charles Stewart69, honestly, I’d give anything to work with actual professionals—people who actually plan ahead and know what they’re doing instead of just winging it... 🤣

My question was specifically about why those self-employment tax contributions aren't hitting yet, considering the deadline for the monthly filing is the 15th, and this month the 15th landed on a Sunday.

Your accountant must be a real genius 😉

I can't believe how much you love hearing yourself talk 🙄
Between the 4th and the 5th of the month 🙄

😁

From what I can tell, you aren't actually registered in the VAT system; you just have a VAT ID.
Based on that, whenever you make an acquisition, you're required to file those specific tax forms and pay the sales tax on any goods you've imported from other parts of the USA.

At the end of the day, someone has to foot the bill for the sales tax. In this setup, that responsibility falls squarely on you here at home.
If you had stayed outside the system, they would have just tacked their local sales tax onto your invoice right there in Spain.

It’s vital to get your exact status sorted out first, because everything hinges on how you're classified. Unfortunately, a lot of people either don't understand the nuances or just breeze through the details, giving answers that aren't quite right.

cosmictinker24 said:So, I closed out the March statement with $138... (paid 417.00)
But now, the April statement shows $137, though it's been reduced by $1.00, leaving a balance of $136 to pay.
If I pay that $136, but I enter the bill with $137 and mark it as paid at $136, I still have an unpaid balance for $1.00... I guess I just don't see how to carry that over and close it out on the April statement?
Sorry to bug you, I'm just totally lost here...

Just those ones. $1.00 Just set your payment date to May 1st, even if you already settled up sometime in April. That way, your credit carries over perfectly and your balance hits zero. It’s basically like applying a store credit to clear out your tab entirely.

cosmictinker24 said:The software isn't letting me book the invoice for $138 if I set the payment to 417... it keeps saying the payment total exceeds the invoice amount??

So, it’s a March bill that got paid in April, but there was an overpayment of $1.00. Did I get that right?
You close out the March bill for the full amount, then you take that $1.00 overpayment and apply it toward the April bill, paying just the difference.

cosmictinker24 said:You’ve got until the 15th of the month to file the JOPPD for the previous month's contributions. Honestly, the specific date doesn't matter much, as long as you make sure the payments actually clear by then...

Thanks.

May 15th falls on a Sunday. Should I just date them for the 15th and actually file everything on the 16th?

The issue is the taxes haven't been paid yet, and they won't be settled by May 15th.

Olivia Cruz86 said:So, I totally overpaid my Verizon bill $1.00 by mistake... now Verizon is giving me back those $1.00 on my next statement..
How am I supposed to log these accounts so everything actually balances out correctly?

Just book the full invoice amount, then apply the payment using only the amount from that $1.00 credit. That’ll leave the remaining balance open, which is exactly what you need to show the outstanding difference you still owe.

What’s the deadline for filing my JOPPD regarding self-employment contributions?🕺

Nicole Lee6 said:Has anyone here ever dealt with transferring business turnover from a father to a son specifically because the old man is heading into retirement?

If we pull this off within the same fiscal year, do we actually get to continue the existing sequence of invoice numbers, or am I going to have to start all over again at number 1?

You basically start a brand new entity with its own unique ID and a fresh sequence starting at 😉
.

urbanbadger33 said:Can someone give me a hand here? I run my own small business and just sent out an invoice $467. The client paid via credit card, but after my bank took their cut of the transaction fee, the actual amount that hit my account was only $443. Now I'm stuck wondering how the hell I'm supposed to mark this invoice as fully paid in my books. I'm working over at Silicon Valley.
Thanks.

$23 In plain English, you just write off the difference. Once you get the statement from the processor, you record the $23 as a merchant processing fee under your expenses.

I ran into this exact headache with the latest version of Java. If you roll it back to an older version, the error disappears.
The catch is that once you go back, everything else breaks—like my banking apps or Intrastat filings—but at least the IRS portal actually works.🤦