Splitcoaststampers.com - the world's #1 papercrafting community
You're currently viewing Splitcoaststampers as a GUEST. We pride ourselves on being great hosts, but guests have limited access to some of our incredible artwork, our lively forums and other super cool features of the site! You can join our incredible papercrafting community at NO COST. So what are you waiting for?
We had a thread going about Demoship in Black and White and I thank everyone for responding. One question that has gone unanswered in that thread is what do demos have to do come tax time?
Those of us who are thinking of becoming demos need to know. We're pretty sure we don't need business licenses but what is require by an SU Demo come tax time? Expecially if we are just going to be hobby demos and our best/only customers.
Thanks in advance for your help!
__________________ Darla
Cinderella is proof that shoes can change a girl's life!
The Stone Age didn't end because they ran out of stones.
I would highly recommend keeping a spreadsheet with items such as advertising costs, shipping costs, discounts given to customers, etc. There is one on the SU website, but I have modified my own just a bit. I plugged in the formulas so that once I plug in my monthly numbers, they automatically fill in for the year figures. I also have it keep running totals for my expenses too (I'm pretty excel savvy).
The trick is to stay on top of keeping track. If you wait until the end of the year, you're only going to cause yourself a lot of stress and frustration. Keep all your receipts. Also, I would highly recommend a good accountant. The cost of doing your taxes with an accountant can be written off as a business expense for the next year. Mine costs me about $200, but I have other things such as child care expenses, moving expenses, interest on mortgage, loss of property due to theft, tons of investments, charitable contributions, etc. Even though I'm pretty good in the math department, the IRS is not someone I feel like messing with. :?
If anyone is interested, I can send a blank version for 2005 to help get you started.
Here's how I look at it and it may not be entirely accurate. You may want to talk to a tax professional.
If you are truly a hobby demo and have NO outside customers, then you don't file any taxes. You won't have any income (any checks from SU would simply be considered an add'l discount) or any expenses (those would simply be personal expenses).
But if you make 1 outside sale, then you need to file taxes because you will have instant income and a commission check from SU. Then you keep track of all your expenses. e.g. SU business supplies, SU products (this is tricky because you may make purchases for personal use, not business use), mileage (to/from workshop, deliver products), etc. And track your income (this is fairly easy with our order forms and SU's monthly activity statement).
I know I'm probably leaving out some very important info but that's all I can think of at this time. I use a software program (Turbo Tax) and it will walk you through step by step in doing these taxes. You just need to make sure you have a receipt if you claim something as a deduction.
I am one of those that can truly say, "Don't wait till the end of the year to play catch up!" I have spent the last 3 days straight getting my paperwork in order and it hasn't been fun. So my New Year's resolution is is to not EVER let it get backed up again!
That would be my best advice to those who are signing up and treating it like a business.
Best of luck
__________________ Shannon
Stampin' in the Woodlands, TX
If any of you have requested a copy of my spreadsheet and haven't received it, let me know via my email ([email protected]). Some emails have come back as undeliverable (maybe I just typed it wrong).
I have received many emails, PMs, and message board posts wanting a copy. So if I've missed anyone, please let me know!
This program was designed by a husband of a SU Demo and it an awesome program for tracking your customers, orders, events, outside expenses.
He has a 15 day trial period ... and is WELL WORTH looking into. This program is by far the best program out there to track your business.
You will not be disappointed. I have been a beta tester for this program and TONY, the developer, listens to what you we demonstrators have to say and have truly developed an awesome program.
Thanks for the info on the stampers sidekick. It sounds awesome and is something that I have been trying to create for a very long time. I'm pretty computer savvy, but Access isn't my strongest suit. Anyway, I've got a file I've been playing around with to try to do exactly what this program says it can do.
I think it is wonderful and would love to hear from others what they think. I'd definitely consider purchasing.
I would like a blank version too. Thanks for starting this thread. Since I started in Aug, I've been wondering what I will have to do. Luckily my DH is anal and makes me keep excellent track of EVERYTHING! [email protected]
__________________ "The future belongs to those who believe in the beauty of their dreams."
Eleanor Roosevelt
You can go to the IRS website and look up Schedule C...that is what party plan (like SU) people need to file. It'll answer lots of questions and it is put out by the IRS, so you know the info is right.
__________________ Sharon Rogers
My Blog: www.stampwithsharonrogers.com Attitudes are contagious. Is yours worth catching?
If anyone has PM'd me or emailed me requesting this sheet and did not receive it, please let me know. I copied and pasted the email addresses given to me, but a few came back as undeliverable.
Unfortunately, I don't remember to check this topic, so if you want a copy, please email me directly or send me a PM (with your correct email because the file is too large to go through SCS).
I wait till the end of the year. It only takes me about 3 - 4 hours to do my taxes. I file all my receipts in a file during the year and I keep track of my mileage. It is fairly simple to add up my instant income, add the 1099 income that SU! sends and then subtract my receipts and my mileage allowance. I think it's easy to make taxes very complicated when they really aren't!
I just want to scream when I see incorrect info about taxes being diseminated on the internet. Talk to a tax professional. You can't exactly go to the IRS with "but Susie Jo on SCS said..." Federal and most State guidelines say that unless you make more than $600, you don't have to file. That's $3000 in sales. If you are a demo, just meeting the quarterly minimums, even if it's with the help of other people's small sales, you do not have to file. Why? Because the amount you have put out for yourself to stay afloat is considered expenses and your expenses are going to outweigh the tiny amount of instant income. There's a reason the government puts these guidelines into place. It's for your benefit and theirs. Seriously, check with your tax professional. Better safe than sorry.
Demos and Taxes
