Posts by Daniel Davis43

Arthur Rodriguez18, I would suggest heading down to the local Department of Commerce just to be absolutely certain. What I mentioned to you previously was accurate around 2006, and while regulations do evolve, these types of structural rules rarely change...
In my estimation, hiring an employee with a retail license shouldn't pose much of an issue for your ability to sell, especially since finding staff who have completed their master certifications is such a significant challenge. Are you planning on managing the entire operation entirely on your own?

P.S. It isn't really necessary to quote the entire previous post when you are replying immediately after.🧐

👋

Arthur Rodriguez18!
Let me provide you with a reliable answer. To manufacture any kind of textile goods through a small business, you are required to either hold a master craftsman certification yourself or employ someone who does.
Regarding retail sales, the requirements are slightly more complex. If you are operating a retail outlet in a specialized store, you must possess a sales certification or a high school diploma in a relevant field—specifically textiles—alongside training in retail management. Alternatively, a standard high school diploma paired with specific retail training would suffice.
Best regards! 👋

That is all well and good, but let us return to my initial post from yesterday. At this point, Henry Edwards33 and the rest of you should have full clarity regarding my questions. It was actually quite clear from the start, though perhaps Henry Edwards33 missed the fact that I was merely presenting a hypothetical scenario... after all, one wouldn't dream of launching a small business or a corporation without first understanding the tax implications. If the business were already operational, most of these figures wouldn't be such suspiciously round numbers, would they?
We find ourselves back at square one. If my initial assessment was incorrect, please point out the errors or provide the proper details. If there is any additional information required from my side, do let me know, as I truly believed I had covered everything in my first message!
Best regards! 😉

Daniel Davis43 said:If we look at it from that perspective, then yes, it's true the customer pays it. But in that case, my product, which was supposed to cost, say, $33, now I have to raise the price to $41, which makes it much harder to sell... In my opinion, if the sales tax were added on top of the $33 price and then paid by the consumer, only then would I say the customer is paying it.
I'll have to look into this further, though; I'm not entirely certain right now. I have to head out, so I will write more later...

In addition to the standard deduction, you also have other tax-deductible expenses that can be claimed on your income tax return—things like paid contributions, medical expenses, real estate investments....

I am aware of this part, but I will address the rest later...😉
In addition to the standard deduction, you also have other tax-deductible expenses that can be claimed on your income tax return—things like paid contributions, medical expenses, real estate investments....

I am aware of this part, but I will address the rest later...😉
In addition to the standard deduction, you also have other tax-deductible expenses that can be claimed on your income tax return—things like paid contributions, medical expenses, real estate investments....

I am aware of this part, but I will address the rest later...😉
Please disregard that previous post; I was attempting to make a different point and rushed my response, resulting in an error that doesn't really change the core issue.
I was actually referring to those $33333 from the beginning of my example. Consider this: once customers pay me, the entire amount sits with me, and the sales tax within that total is $6233. Am I the one who pays that tax to the government? If I am the one remitting it, then it isn't the customer paying the state, it is me. The customer paid it to me initially, but ultimately, I am the one paying the government, not the customer...

Henry Edwards33 said:Daniel Davis43,
Look, I’m trying to be helpful here, but I honestly didn't follow what you were asking. 😁

Let's take this step by step so we can clear things up.

First off, you brought in $33333 in revenue. And that was back in 2009, right?

If that's the case, there's no sales tax involved here. Under US tax law, if your revenue stays under $28333 during a calendar year, you don't automatically trigger sales tax registration requirements for the following year.
So, the income you earned doesn't have sales tax baked into it.
Even when you *are* registered for sales tax—like your tax advisor mentioned—you aren't actually paying that tax out of your own pocket. The customer pays it. You just invoice them for the value of your goods or services and add the appropriate percentage on top. That's how it works: the buyer covers the tax, and your only job is to collect it and pass it along to the IRS using the proper filings.

Because of that, you don't subtract sales tax from your gross income when you're filing your income tax return.
On top of the standard deduction, you also have other deductible expenses you can claim on your return—things like paid premiums, medical expenses, real estate investments, and so on.

By the way, income is always calculated before any sales tax is added. 😉

If we look at it from that perspective, then yes, it's true the customer pays it. But in that case, my product, which was supposed to cost, say, $33, now I have to raise the price to $41, which makes it much harder to sell... In my opinion, if the sales tax were added on top of the $33 price and then paid by the consumer, only then would I say the customer is paying it.
I'll have to look into this further, though; I'm not entirely certain right now. I have to head out, so I will write more later...

In addition to the standard deduction, you also have other tax-deductible expenses that can be claimed on your income tax return—things like paid contributions, medical expenses, real estate investments....

I am aware of this part, but I will address the rest later...😉

Thank you for such a prompt response!
My question is purely hypothetical—I made sure to clarify that right at the start. I am simply researching tax implications; I don't have any active business ventures at the moment, otherwise, I would already be fully informed on the matter...
Let's say, for instance, that I maintain the exact same level of revenue for two consecutive years, as outlined in my example, or perhaps even three or more years in a row.
As for the other points you mentioned, I will need to look into those details before I can provide a definitive answer...

Could someone please verify if I am calculating income tax and sales tax correctly? I am looking for a reliable answer, ideally from an accountant, a tax professional, or a business owner who is absolutely certain about this. The following example is hypothetical; it is a bit long, but there is no other way to explain it, and I have just three quick questions at the end. Example:

The owner of a small business or a Small Family Farm had total sales of goods or services amounting to $33333 last year, which was collected via invoices. Since the taxpayer is registered for sales tax (via $28333), we subtract the sales tax from those $33333; if the entire amount is subject to a 23% rate, then the receipts equal $27100.
From that $27100, we deduct expenses, such as $7100, leaving an income of $20000. From these $20000, we then subtract the standard deduction, which for areas outside of special federal zones is $7200 annually (assuming the 2009 figures still apply).
This leaves $12800, which serves as the taxable base for income tax at specific rates; for $12800, the rate back in 2009 was 15%.
$12800 x 15% income tax = $1920, which would be the income tax paid.
Example finished—could you please confirm if everything in here is indeed correct?
So, should the sales tax be paid alongside the sales tax return as $6233?
The IRS told me that the business owner doesn't actually pay that sales tax, but rather the customer does. How would you explain that? To me, it looks like I, as the entrepreneur, am the one paying it. I didn't ask for clarification immediately because I wasn't familiar with these concepts yet; I only asked some general questions and didn't even have this specific example ready.
Lastly, what is the professional term for those $33333 mentioned at the start—is it "receipts" or "receipts excluding sales tax"?
Please, everyone, weigh in while you still can...😁