Do you cheat on your taxes?

[ShawnD1]

From putting away SEP contributions to doing target benefit or defined benefit plans, to leased car expenses that include all your maintenance, to *, there is enough already. Once it is on my personal return it is as clean as can be.

I don't mean to attack you, but is there a reason for leasing the car?


My friend's parents own a business and the business owns a minivan. Officially it's for company business, but it's used for personal stuff too. From the way they explained it, it sounded like they can write off most gasoline and all maintenance, but they will need to pay income tax when the van is sold. It's a 1991 GM Safari and it's still doing company business. They use it for hauling around small amounts of tools or small parts that would be used by a heavy duty mechanic.

 

[ShawnD1]

I spend a lot of money on stuff for my classroom each year.

Why do you do this?

At most jobs, most people have a "fuck it" attitude. If my work computer fucks up and I can't draw things, I'll find something else to do until they fix it. I certainly won't use my own money to fix it. Same thing for pencils, pens, paper, staples, paper clips, etc.

The teachers in my schools actually had their own assigned markers and erasers for class. Rather than leave chalk/marker in the class and have students throw them in the garbage, the teacher would grab markers from the supply room and carry them around on his or her person.

 

[Ns1]

Why do you do this?

At most jobs, most people have a "fuck it" attitude. If my work computer fucks up and I can't draw things, I'll find something else to do until they fix it. I certainly won't use my own money to fix it. Same thing for pencils, pens, paper, staples, paper clips, etc.

so sad.

 

[The-Noid]

I don't mean to attack you, but is there a reason for leasing the car?


My friend's parents own a business and the business owns a minivan. Officially it's for company business, but it's used for personal stuff too. From the way they explained it, it sounded like they can write off most gasoline and all maintenance, but they will need to pay income tax when the van is sold. It's a 1991 GM Safari and it's still doing company business. They use it for hauling around small amounts of tools or small parts that would be used by a heavy duty mechanic.

So many different things you can do. Just making it clear that many of the leased cars for a lot of firms don't drive a whole lot for work. We have a couple of law partners as clients that have very expensive cars, S550 and an Audi S8 that take around 60% of the lease off because it is 60% business. That includes the maintenance, gas and insurance. The other 40% AFAIK comes back as income and you should have some sort of corporate accountability plan. Some will find that a corporate leasing program works better, others will find mileage works better. Generally if you are driving A LOT mileage works to your advantage, if you aren't leasing seems to work better.

After, $60,000 of market price of the car you start to lose some tax benefits however.

Not saying it is right but the tax system does favor the wealthy and small business that you can control for benefits.

Always consult your tax adviser or CPA on this forum as this really isn't my deal anymore.

 

[edro]

I think you guys are way too scared of the IRS.

All you have to do is claim ignorance, then pay whatever is owed after they audit you.
Their fees aren't that bad.

 

[Yreka]

I dont pay internet tax, and usually "share" the tax software each year, thats about it.

Guy I carpool with somehow claims he has a buisness he doesnt, and ends up getting like an extra 10k on his taxes each year. AFAIK, he just took out a buisness licence, and writes off all of his relateable expenses to that throughout the year ( including power, house stuff etc because its a home buisness)

It kinda pisses me off tbh.

 

[lord_emperor]

I forgot to report a commission I earned for selling a printer once.

It was like $800, sent to me in the form on a pre-paid mastercard from the states (I'm Canadian).

I got a notice of assessment, somehow the CRA learned about this and billed me for $100 or so.

I figure if they can pick out some obscure random payment I got it's probably not worth actually trying to cheat.

 

[ShawnD1]

I dont pay internet tax, and usually "share" the tax software each year, thats about it.

Guy I carpool with somehow claims he has a buisness he doesnt, and ends up getting like an extra 10k on his taxes each year. AFAIK, he just took out a buisness licence, and writes off all of his relateable expenses to that throughout the year ( including power, house stuff etc because its a home buisness)

It kinda pisses me off tbh.

Things used for business can only be written off when doing the business' taxes.

Suppose I'm Shawn and I work for someone at a regular job. I also have my fake corporation called SexualCorp. Things purchased by SexualCorp cannot be deducted from Shawn's taxes. They can only be deducted from SexualCorp's taxes, and that only works if SexualCorp actually has an income.

 

[Ns1]

Things used for business can only be written off when doing the business' taxes.

Suppose I'm Shawn and I work for someone at a regular job. I also have my fake corporation called SexualCorp. Things purchased by SexualCorp cannot be deducted from Shawn's taxes. They can only be deducted from SexualCorp's taxes, and that only works if SexualCorp actually has an income.

Unless SexualCorp is taxed as a sole prop.

 

[Ninjahedge]

BoS511 -

Why should you pay? Beacause that is what a lot of states are lobbying for. They want the buisnesses set up in their states to pay taxes for the state they are in.

So you have a certain % or retail in your state, you expect a certain amount of taxes to be generated so that you can provide services for them, and others in the state.

I would rather have no tax, as it is now. But lets face it, if they do not come up with something soon, you will probably end up paying State sales tax from both states.

 

[The-Noid]

Things used for business can only be written off when doing the business' taxes.

Suppose I'm Shawn and I work for someone at a regular job. I also have my fake corporation called SexualCorp. Things purchased by SexualCorp cannot be deducted from Shawn's taxes. They can only be deducted from SexualCorp's taxes, and that only works if SexualCorp actually has an income.

They could be deducted from Shawn's Schedule C without even having to file a return for the corp. Having the name corp in a sole prop is often bad though.

It does help when you have income but you can take perpetual losses as well.

 

[ShawnD1]

They could be deducted from Shawn's Schedule C without even having to file a return for the corp. Having the name corp in a sole prop is often bad though.

It does help when you have income but you can take perpetual losses as well.

I don't quite understand what you're doing. Like you get a pay check, you invest it into SexualCorp, SexualCorp owns your car and your house, then you claim SexualCorp on your own taxes as an investment loss because the company has no income and tons of loss?

 

[Yreka]

Originally Posted by ShawnD1
Things used for business can only be written off when doing the business' taxes.

Suppose I'm Shawn and I work for someone at a regular job. I also have my fake corporation called SexualCorp. Things purchased by SexualCorp cannot be deducted from Shawn's taxes. They can only be deducted from SexualCorp's taxes, and that only works if SexualCorp actually has an income.

They could be deducted from Shawn's Schedule C without even having to file a return for the corp. Having the name corp in a sole prop is often bad though.

It does help when you have income but you can take perpetual losses as well.

Yeah I have no idea about this stuff TBH.. Im totally lost when it comes to finacial / tax related stuff. Im pretty sure he only does one return..

I do know he used to actually do repairs on the side thru craigslist, but hasnt done anything the past few years because our regular job keeps him pretty busy.

 

[The-Noid]

I don't quite understand what you're doing. Like you get a pay check, you invest it into SexualCorp, SexualCorp owns your car and your house, then you claim SexualCorp on your own taxes as an investment loss because the company has no income and tons of loss?

What you are talking about is outright breaking of tax rules not bending or being to the letter of the law.

If Shawn DBA Sexual Enterprises was in a business of something and that something involved driving a lot then you could take the mileage off. The key is Sexual Enterprises has to be an actual business but in that case it could take perpetual losses but that is a loss of your take home income that is still being spent elsewhere.

Sexual Enteriprises could also be in the business of owning real estate, just not the house you live in. There are numerous exclusions and exemptions that are available, but still in most cases you are better paying the tax and having the money.

I will give you the real simple answer to the tax code.

If you are a business and you are spending money someone else is claiming it as income.

If you don't spend that money you pay tax on it. The idea is taking a little bit from a lot of people is better than taking a lot from one person. That is the multiplier of money and fundamental to economies that charge tax.

 

[The-Noid]

I dont pay internet tax, and usually "share" the tax software each year, thats about it.

Guy I carpool with somehow claims he has a buisness he doesnt, and ends up getting like an extra 10k on his taxes each year. AFAIK, he just took out a buisness licence, and writes off all of his relateable expenses to that throughout the year ( including power, house stuff etc because its a home buisness)

It kinda pisses me off tbh.

Generally when taking something off at your primary residence you would want to have that part of the house segregated. Real home businesses will often pay to have a second power and water meter put in so that exact expenses can be deducted.

Everyone that is given a corporate cell phone cheats on their taxes if you read the letter of the law. IRS has never really clarified what is de minimis.

Again this is not my baileywhick anymore, accounting is a stepping stone to other careers, I haven't done taxes in a long time so take what I have to say with a grain of salt.

 

[Brainonska511]

BoS511 -

Why should you pay? Beacause that is what a lot of states are lobbying for. They want the buisnesses set up in their states to pay taxes for the state they are in.

So you have a certain % or retail in your state, you expect a certain amount of taxes to be generated so that you can provide services for them, and others in the state.

I would rather have no tax, as it is now. But lets face it, if they do not come up with something soon, you will probably end up paying State sales tax from both states.

They want the businesses to collect the taxes because people are not paying them on their own, as they are supposed to if the business does not collect the sales tax. The business is not paying sales tax.

And again, it's not "no tax now." You already are required to pay sales taxes, even if they aren't collected at the point of purchase. The states are only now starting to look into enforcement of the existing laws or ways to push businesses to collect and remit the taxes.

As for paying sales tax to both states - it doesn't work like that. If I buy something in Florida and bring it back to New York, I might have to pay a difference in sales/use taxes between the two states (if the state I'm bringing the item into has a higher rate), but I would never have to pay both sales taxes in full, as you suggest would be in the future.

And I don't think your paying both sales taxes would ever come to fruition, since it is the person purchasing that has to pay it to the state he is living in. The business merely acts a collection conduit.

 

[Pollock]

IRS in 3...2...1...