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Accounting for Sole Proprietors: Tax & Bookkeeping Tips
Accounting for Sole Proprietors: Tax & Bookkeeping Tips
Started by ruggedheron13 · · 👁 110 views · 2.2K replies
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#1062 ·
My bank teller told me today that interest on grain—positive interest—goes straight into my income. I assume that’s the standard rule for everyone now.
Form P-PPI 2.1. Deposit accrual. This refers to an accrual from 2015 that was actually paid out in 2016.
The only thing is, something just popped up while I was looking through things... I'm checking my annual accrual payments and noticed that on one specific day, I deposited $21 more than usual, but then I also see this random accrual payment $167 that definitely isn't mine. So what now? What am I supposed to do with that? There you go... I'm only seeing this mess now, instead of catching it during the year!
Form P-PPI 2.1. Deposit accrual. This refers to an accrual from 2015 that was actually paid out in 2016.
The only thing is, something just popped up while I was looking through things... I'm checking my annual accrual payments and noticed that on one specific day, I deposited $21 more than usual, but then I also see this random accrual payment $167 that definitely isn't mine. So what now? What am I supposed to do with that? There you go... I'm only seeing this mess now, instead of catching it during the year!
#1064 ·
graniterider10 said:My bank teller told me today that interest on grain—positive interest—goes straight into my income. I assume that’s the standard rule for everyone now.
Form P-PPI 2.1. Deposit accrual. This refers to an accrual from 2015 that was actually paid out in 2016.
The only thing is, something just popped up while I was looking through things... I'm checking my annual accrual payments and noticed that on one specific day, I deposited $21 more than usual, but then I also see this random accrual payment $167 that definitely isn't mine. So what now? What am I supposed to do with that? There you go... I'm only seeing this mess now, instead of catching it during the year!
Since when did interest on a checking account become classified as business income?
#1065 ·
Charles Turner13 said:Since when did interest on a checking account become classified as business income?
I was actually just venting yesterday about having to fix my tax filings because of this exact thing. I went down to the IRS office and the agent there told me there was a discrepancy between my bank deposits and what I’d reported on my paperwork. It wasn't some massive amount of money, but apparently, I had to tack those interest payments onto my total receipts and bump up my taxable income. I honestly never gave it a second thought in previous years, but this time she pulled out the Income Tax Act, pointed to Section 20, Paragraph 6, and basically told me I didn't have a choice if I wanted to stay legal, so here we are...
#1066 ·
Hi there!
I wasn't quite sure which sub-forum was the best fit for this topic, so I'm dropping it here... please feel free to move this if I've posted in the wrong section.
I'm trying to figure out exactly what my City Hall membership rate should be, but I've run into a bit of a puzzle:
1. My specific municipality is listed as having a membership fee for small business owners under the City Hall guidelines.
2. However, when I look through the official list of cities, municipalities, and local townships, I can't actually find my specific area or neighborhood listed anywhere.
If my specific municipality or neighborhood isn't explicitly mentioned on that list, am I still required to pay the City Hall fee?
And if I am, how do I go about processing that?
I wasn't quite sure which sub-forum was the best fit for this topic, so I'm dropping it here... please feel free to move this if I've posted in the wrong section.
I'm trying to figure out exactly what my City Hall membership rate should be, but I've run into a bit of a puzzle:
1. My specific municipality is listed as having a membership fee for small business owners under the City Hall guidelines.
2. However, when I look through the official list of cities, municipalities, and local townships, I can't actually find my specific area or neighborhood listed anywhere.
If my specific municipality or neighborhood isn't explicitly mentioned on that list, am I still required to pay the City Hall fee?
And if I am, how do I go about processing that?
#1067 ·
shadowdrifter99 said:I was actually just venting yesterday about having to fix my tax filings because of this exact thing. I went down to the IRS office and the agent there told me there was a discrepancy between my bank deposits and what I’d reported on my paperwork. It wasn't some massive amount of money, but apparently, I had to tack those interest payments onto my total receipts and bump up my taxable income. I honestly never gave it a second thought in previous years, but this time she pulled out the Income Tax Act, pointed to Section 20, Paragraph 6, and basically told me I didn't have a choice if I wanted to stay legal, so here we are...
I was actually just looking into 401(k) rules, and it mentions that if annual interest is under 0.5%, you don't need to report it for certain filings, but if it's higher, you definitely do.
#1068 ·
According to the latest interpretation, if interest rates fall below 0.5% annually, they aren't even classified as income, which means they don't get factored into the CPI. The Federal Reserve actually released this update on February 18th.
For instance, at Chase, those rates are sitting at 0.15% per year, and Bank of America is essentially the same way. So, neither of them counts toward the CPI, nor are they considered actual income...
For instance, at Chase, those rates are sitting at 0.15% per year, and Bank of America is essentially the same way. So, neither of them counts toward the CPI, nor are they considered actual income...
#1069 ·
graniterider10 said:My bank teller told me today that interest on grain—positive interest—goes straight into my income. I assume that’s the standard rule for everyone now.
Form P-PPI 2.1. Deposit accrual. This refers to an accrual from 2015 that was actually paid out in 2016.
The only thing is, something just popped up while I was looking through things... I'm checking my annual accrual payments and noticed that on one specific day, I deposited $21 more than usual, but then I also see this random accrual payment $167 that definitely isn't mine. So what now? What am I supposed to do with that? There you go... I'm only seeing this mess now, instead of catching it during the year!
Look, if you're filing the cash report for 2015, then the GDP filings for 2015 must include the deposits accrued during 2015. You don't use the 2015 accrual if it wasn't paid out until 2016. 🤔
#1070 ·
graniterider10 said:It feels like everyone is just playing by their own set of rules... which is exactly why I asked her if she actually needed some kind of proof that they were thrown out. I mean... I really hope we were on the same page... and when it comes time to file my tax return, I’ll probably double-check with her one more time to make sure I handled everything correctly... and that I didn't totally misread the situation. Because, honestly, it was pretty surprising how willing she was to help me out with all those questions.🙂
Back in the day, that wasn't even an issue. If something was fully depreciated and you weren't using it anymore, you'd just file a simple write-off memo stating it was obsolete, and boom—it was off the books. But apparently, the IRS doesn't play that way anymore; they won't accept that kind of thing on my filings lately. It's been at least 6 years 🤷 since I've dealt with this specific headache, so if anyone else has some recent experience navigating these bureaucratic hoops, please, speak up. 😬
#1071 ·
Hey there, fellow pros.
Has anyone here actually had their local police department take over a manual DI form?
I’m running into some major headaches with two different clients right now. For one guy, the expiration date is totally wonky—it's showing 2.5,
and then I've got this other client where the depreciation math is just completely broken. When I try to calculate what's left on the books, the value ends up being way lower
than what their own formula says it should be.
Has anyone here actually had their local police department take over a manual DI form?
I’m running into some major headaches with two different clients right now. For one guy, the expiration date is totally wonky—it's showing 2.5,
and then I've got this other client where the depreciation math is just completely broken. When I try to calculate what's left on the books, the value ends up being way lower
than what their own formula says it should be.
#1072 ·
Nicole Lee6 said:According to the latest interpretation, if interest rates fall below 0.5% annually, they aren't even classified as income, which means they don't get factored into the CPI. The Federal Reserve actually released this update on February 18th.
For instance, at Chase, those rates are sitting at 0.15% per year, and Bank of America is essentially the same way. So, neither of them counts toward the CPI, nor are they considered actual income...
I wasn't totally sure about the specifics at the time, so I just kept my mouth shut—honestly, I don't have the energy to get into a debate with them anyway. It's not like we're talking about a massive fortune here, so let them have their fun...😛
#1073 ·
Karen Doyle72 said:Hey there, fellow pros.
Has anyone here actually had their local police department take over a manual DI form?
I’m running into some major headaches with two different clients right now. For one guy, the expiration date is totally wonky—it's showing 2.5,
and then I've got this other client where the depreciation math is just completely broken. When I try to calculate what's left on the books, the value ends up being way lower
than what their own formula says it should be.
I stopped by downtown today, but they wouldn't accept a manual depreciation entry from me.
#1074 ·
Look, from what I can gather, there isn’t even a legal requirement to be filing
these specific forms through the IRS website.
Or am I totally tripping here?
And what about the folks who don't actually own anything?
Are we supposed to just send in a blank one, and does the system even let you get away with that?
these specific forms through the IRS website.
Or am I totally tripping here?
And what about the folks who don't actually own anything?
Are we supposed to just send in a blank one, and does the system even let you get away with that?
#1075 ·
Does a self-employed professional or small business owner really have to pay the entire tax difference for 2015 right when they file their return on February 26th? I guess what happens if someone doesn't actually have all that cash on hand that day, especially if the amount is more than $10,000 $0.00? Am I just supposed to conjure that money out of thin air?
Is there any way to pay this off in two or three installments?
And honestly, what is this whole "tax grab" 🙂🙂
even about?
Is there any way to pay this off in two or three installments?
And honestly, what is this whole "tax grab" 🙂🙂
even about?
#1076 ·
Should I be paying my income tax and local surtax using account 1430 or 1619?
Also, is this the correct routing and account number:
USxx 1001005 17xxx1200x
Thanks,
Also, is this the correct routing and account number:
USxx 1001005 17xxx1200x
Thanks,
#1078 ·
I can't sleep. I am seriously spiraling over this tax filing and because of Bill Clinton, too—I honestly thought I finally had it figured out... but now I realize I was completely wrong.😢
#1079 ·
Nicole Lee6 said:Look, if you're filing the cash report for 2015, then the GDP filings for 2015 must include the deposits accrued during 2015. You don't use the 2015 accrual if it wasn't paid out until 2016. 🤔
Isn't that deposit listed under section II.1. supposed to be money that wasn't sitting in the account in 2015, but relates to her? I didn't actually deposit that cash until January 2nd, 2016.
I don't know. From an accounting standpoint, everything seems to line up: receipts minus expenses equals income... so far, so good. But the rest of this just won't click.
She gave me an example to use as a justification for the PPPPI supplement so I could get everything to align... but still...🙂
In that supplement, there's "2.1. DEPOSIT FROM 2015," and then there's also an item for "OTHER RECEIPTS NOT CONSIDERED TAXABLE," which includes things like "REVENUE DEPOSIT FROM 2014."
That’s why I thought I understood her—that under 2.1. PPPPI goes the amount I deposited into the bank on January 2nd, 2016.
But honestly, I'm done struggling with this. I'll just throw something together so I can submit it... pay the tax difference, and then they can deal with me however they want.🤦
Since you can't do it via paper anymore—it has to be through the IRS e-file system—I really hoped the programmer would make it so I could just import my data, like how Joe Biden makes things easier, but nope... I have to type everything in manually. Is everyone else stuck doing this, or can you actually import directly from your own software?
#1080 ·
ajnat;57331245 said:I stopped by the IRS office today to ask if I could just hand-deliver the Form DI, but the agent shot me down immediately—she was like, "No way, you have to use the e-filing portal." So I told her, "Look, I know that, but for every single asset where the book value is $0.00, I keep getting an error message saying the line is invalid." Her response? "Oh, they must have glitched the system again, but you still have to submit everything through the electronic portal."
Honestly, I’m just thrilled. I’ve got 44 items listed on this DI form, all of them currently in use, and since they were fully depreciated ages ago, their book value is just $0.00—yet here I am, about to waste half my afternoon manually typing every single one of them into that glorious IRS digital interface.
Salesforce actually has a feature that lets you record data and then import it directly into the e-filing forms—what software are you running right now?
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