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Hi all,
How do you go about paying taxes on your online earnings? Do you hire a CPA or do you handle everything yourself?
In the past I have always handled this myself. It’s always been a breeze to fill out the papers and send them in by April 15. This year, however, things aren’t as easy because I have more than 1 stream of income.
I think I’m in trouble because I didn’t pay any quarterly taxes in 2005. I didn’t know I had to pay a “quarterly” tax — in the past I only worried about April 15. This year I “owe” more than the $1,000 threshold, so I believe I will have to pay the overdue tax, plus 6% interest. :unhappy:
I prefer to do everything myself. I don’t like the idea of some 20y/o H&R Block temp asking questions about my income. I can only imagine how uncomfortable I would be if they started asking questions about the source of my supplemental income. I would say “advertising,” but I’m sure the next question would be, “Oh really? What do you advertise?” “Um… stuff.”
Should H&R Block (or a similar storefront-type tax place) be avoided? Having never worked with a CPA, I have no clue what to expect. For those of you who have dealt with CPAs before — how much detail do you need to provide? How nosey are they? I know some of you rely on CPAs — how do you find a good one that knows his stuff, and that doesn’t ask too many questions?
Summing up — I don’t know how to pay quarterly taxes, I owe the government quite a bit for 2005, and I’m hesitant/nervous about involving anyone else in the tax filing process. Is this something I should learn to handle on my own, or is this something that is better left to a CPA?
I’m sure all of you were in this position at some point in the past…. If you opted for the CPA route, would you say it’s “the best thing you ever did?” Or if you learned to do it yourself, would you say that you’re “sure glad I learned to do that myself; saved a lot of money by not wasting it on a CPA”….
Thanks in advance. Also, if anyone wants to talk on the phone about this, PM me and I’ll send you my number.
Dave this is an excellent question for Ron Santini, the CPA speaking at CAP Spring Break in Miami.
When it comes to taxes I STRONGLY advise you retain a CPA and do not rely on other affiliates for tax advice. Even though people have good intentions and THINK they know tax law its best to consult a professional for advice on something this serious.
What the professor said.
It is best to get a CPA at any stage – they tend to pay for themselves regardless.
Thanks guys. :thumbsup:
I am desperately trying to find a way to attend CAP Spring Break; I was looking forward to Ron Santini’s presentation. At the moment, however, we are supposed to close on our new condo sometime during the week of May 22. We can’t delay this because we need to be completely moved out of our current home by May 31; if we delayed the closing by a week, it would be a stretch to get everything moved out in time. The developer tells me that it might be possible to get the closing date moved up one week, but right now it’s too soon to tell. It depends on the construction progress, which depends on the weather and other factors. Hopefully everything will work itself out very soon… :popcorn:
Back to the CPA issue — How much information to you give to the CPA? Do you just hand them a printout of your income and expenses, and let them figure out the forms and such based on that? I imagine there would be some general discussion about where the income comes from… How much does your CPA actually know about the source of your income? Do you say “online advertising” or do they know that part of your income comes from online casino revenue sharing?
Engineer wrote:Back to the CPA issue — How much information to you give to the CPA?As much as he/she needs.
Mostly, I’ll just agree with Lou.
Now that you’re running a business, you also need a CPA who will ask you the right questions and give you suggestions for how to deal with taxes and expenses for the future.
Engineer wrote:Hi all,How do you go about paying taxes on your online earnings? Do you hire a CPA or do you handle everything yourself?
In the past I have always handled this myself. It’s always been a breeze to fill out the papers and send them in by April 15. This year, however, things aren’t as easy because I have more than 1 stream of income.
I think I’m in trouble because I didn’t pay any quarterly taxes in 2005. I didn’t know I had to pay a “quarterly” tax — in the past I only worried about April 15. This year I “owe” more than the $1,000 threshold, so I believe I will have to pay the overdue tax, plus 6% interest. :unhappy:
I prefer to do everything myself. I don’t like the idea of some 20y/o H&R Block temp asking questions about my income. I can only imagine how uncomfortable I would be if they started asking questions about the source of my supplemental income. I would say “advertising,” but I’m sure the next question would be, “Oh really? What do you advertise?” “Um… stuff.”
Should H&R Block (or a similar storefront-type tax place) be avoided? Having never worked with a CPA, I have no clue what to expect. For those of you who have dealt with CPAs before — how much detail do you need to provide? How nosey are they? I know some of you rely on CPAs — how do you find a good one that knows his stuff, and that doesn’t ask too many questions?
Summing up — I don’t know how to pay quarterly taxes, I owe the government quite a bit for 2005, and I’m hesitant/nervous about involving anyone else in the tax filing process. Is this something I should learn to handle on my own, or is this something that is better left to a CPA?
I’m sure all of you were in this position at some point in the past…. If you opted for the CPA route, would you say it’s “the best thing you ever did?” Or if you learned to do it yourself, would you say that you’re “sure glad I learned to do that myself; saved a lot of money by not wasting it on a CPA”….
Thanks in advance. Also, if anyone wants to talk on the phone about this, PM me and I’ll send you my number.
Well it’s a differnt country … and tax law is a lot simpler here in New Zealand than the United States (I beleive) but I’ve always used an accountant.
Lots of benefits :
– You get the re-assurance that you’re doing things right
– You pay the correct taxes at the right time
– You get help in structuring your business in a more tax efficient way.While I’m pretty much a do-it-yourself sort of person I think that it would be air to say that tax law is far from intuitive. Get expert help. Failing to make payments as you did hurts (with the penalties) and being ignorant of the requirement is no defence.
My accountant costs less than $1,500 a year … and it’s tax deductable. I get to go to sleep at night knowing that this side of the business is correct and covered. One of the easiest and berst decisions I made.
:cheers:TheGooner wrote:While I’m pretty much a do-it-yourself sort of person…I’ve always been that way too.
I’m good enough. I’m smart enough. And gosh darn it, people like me. (SNL reference in case anyone missed it.)
Like TheGooner said… “Get expert help.” These cpa-tax-type-people live and breathe taxes. They spent years learning it, and they do it constantly, keeping up with tax changes on a regular basis.
It might take me 30 hours to learn the answer to a question they could answer in 30 seconds. Yeah, I could do it, but it becomes obvious that I shouldn’t with such an extreme example.
Now, I will install a light fixture in my house… maybe even run a circuit for it, change out switches, or outlets. I have a little background there. There’s no way I’d try to rewire an entire house. It’s not what I’m good at, can’t take the time to learn it, and I risk an entire house going up in flames. Do what you’re good at. Pay others to do what they’re good at.
Thanks for the tips, everyone.
I actually tried figuring everything out on my own, but after a few hours of frustration, I gave up. I do think I can handle the quarterly taxes in 2006, once I get some advice from a tax professional on how to estimate the quarterly payments. This year is further complicated because I am buying a home, and now I will be able to deduct mortgage interest and property tax from my income. So, in 2006 I will start itemizing my deductions, and I’ll start paying quarterly taxes…. Oh, and if I get married this year or next year, that will probably affect things too.
Thanks again for the advice. :satisfied
