It's TAX TIME again- oh gawd

[Go2Tex]

Sooo, every year it's the same. What line do I put this or that on the Schedule C? I have so much conflicting information on this stuff it always drives me nuts. There's the info in the Dome Register, there's the help prompts in the Quicken program and then there's my last year's tax forms completed by a CPA, and they all are DIFFERENT!!!!!!!!!!

I'm wondering how everyone else does it? When compiling your figures for the CPA or if you do your own taxes, where do you add up stuff like your small hand tools? Do you depreciate them all for 7 years like you would your sewing machine, or do you just bury the cost under "other costs" or supplies?

And then the rhetorical question, what friggin difference does it make which line you put it all on if, in the end you just add them all up and subtract the total from your gross?

It's enough to make a grown man drink.

[David Genadek]

I think the big thing is to do it consistent from year to year and you will be ok. I exspense my hand tools and keep them in a seperate pile because I want to know how much money I'm spending on them but you sure could throw them into supplies. Because they do all end up as a direct exspense. The reason the books seem to look so different is because they have different purposes. The IRS wants a big broad picture you may want a different picture so you can manage the business. In the end all the numbers are the same it is just different views of the same numbers.

David Genadek

[esantoro]

I think the big thing is to do it consistent from year to year and you will be ok. I exspense my hand tools and keep them in a seperate pile because I want to know how much money I'm spending on them but you sure could throw them into supplies. Because they do all end up as a direct exspense. The reason the books seem to look so different is because they have different purposes. The IRS wants a big broad picture you may want a different picture so you can manage the business. In the end all the numbers are the same it is just different views of the same numbers.

David Genadek

Can you deduct startup expenses from 2006 if you officially started your business in 2007? If not, is there any way to deduct earlier startup expenses?

Thanks,

Ed

[Randy Cornelius]

God nows I may not doing it right but the way my accountant wants it is this. All my tools that I buy that I will keep in the business are grouped into one lline item as they can be depreated. Then the usable or consumables, thread, glue, leather, paper ect. is one line. Then travel expenses to shows and classes I attend can also be deducted. Travel expenses to shop for leather and supplies is a deduction. As well as shipping expenses. If you use you home for your business you can deduct that % of what you business consumes as far as utilities, phone, insurance etc. Well there are most likely more learnard and experianced people out there to talk about IRS than me.

RC

[Go2Tex]

Yeah, that's about the same as what the CPA had me do last year. Figuring the COGS, cost of goods sold, has a couple different lines though. What do you put under "other costs"???? I lumped everything into one line last year and that created an IRS flag situation because one line was out of the ordinary. It's cr*p like this that drives me nuts.

Is leather a raw material? Rawhide is more raw than latigo. Just how processed can a material be before it's considered not raw? And how do you know for sure how much thread went into the saddle? Weigh every spool of thread in your shop before and after? And then there's the inventory nightmare every year...... do you actually count every friggin screw, nail and rivet? Do you estimate all the scrap or just ignore it? The CPA said no, just estimate it. OK, sounds good. So, what good is that info to anyone? and if my estimate is off, I get audited someday.

What gets me is all this tax nightmare is caused by the government taking too much to begin with and then trying to catch people trying to get out of paying it. The whole thing is overly complicated and literally impossible to get right. The IRS knows that and keeps it that way so they can audit just about anyone at anytime for any reason, no matter how you do it.

If cops stopped cars at random for no reason and searched them, the courts would throw it out. The IRS does it routinely and people go to jail with little or no recourse.

[BillB]

Since I am a Civil Servant, I would like to set the record straight.

We don't make the laws, congress does and the president signs them.

We don't get to pick the people who are put in charge of us, in most cases they are political appointments by the winning party. It they get to make the rules that we are then asked to enforce no matter how ridiculous they are.

We have the same complaints that you do but when the government is based on the belief of "for the people" and "by the people", it takes the people to elect a congress that will respond to them rather than special interest groups, political agendas, etc.

I also have to follow the same tax laws you do and, yes, they need to be changed.

[Go2Tex]

<" it takes the people to elect a congress that will respond to them ">

Yeah, and we're getting a daily dose of the reality of our political system that keeps the tax code and a lot of other rediculous laws in place. Just turn on the TV and watch the spectacle of how "We The People" get to choose those leaders. It's enough to make me want to puke.

Unforntunately in this country we're closer to the image of the guy standing in front of the tanks in Tianaman Square than we are to the image of the Berlin Wall coming down. In each case it comes down to the guys in those tanks either going along and following orders or, refusing those orders and doing the right thing.

[Jordan]

Ummm.... here is a clue, most of the people in washington that were elected Buy the People were or still are Lawyers. The guy that pushes the button in the elevators for those fat cats is a civil servant and makes more per year than I ever have in any job. BTW before anyone takes offense I have worked worked state and local government jobs, public works and state hospitals most of my adult life. Wouldn't want those peoples representatives to have to lift a finger would we? Read that somewhere years ago thought it was pretty outrageous then and it still is now. Imagine $80,000.00 a year to push buttons for a living, and they wanted a raise! where do I sign up I still have one good arm. Oh wait, they need a greeter at wally world maybe I can do that and have their HR department teach me how to get food stamps and medicare/medicaid. Sorry to hijack but when I think taxes I just am overcome with the need to rant and rave a little.LOL...Jordan

Edited January 11, 2008 by Jordan

[BillB]

I've worked in the USG now 27 years, and most of in or around DC. I have yet to see an elevator operator in any of the buildings have been in. There are some interesting Urban Myths around. That's not to say that there aren't some cushy jobs or folks that will milk the system, but I also found that true in 10 years of private industry. The point that seems to be missed is that in "By the People, For the People", we have to take an active role in politics as well as government if we are going to take back this country from the Lawyers, Politicians and special interest groups. That is one of the obligations we have as being citizens in this fine country and I do mean fine country.

[Jordan]

How true, great country and would not want to live anywhere else. And as you say it could have been an urban myth I read it well over 10 years ago at a time in California that the state would not balance the budget and issued us workers IOU's for 3 months that no banks would cash. And that is not a myth I lived it, very hard to pay bills with an IOU. Probably some union recruiting tactic at the time the unions were hot and heavy infighting then too.