Taxes

Peter Bowen peter at bowenfamily.org
Wed Feb 9 09:31:42 MST 2005


Sasha - First let me say - RIGHT ON!  Owning your own business will 
either be the best thing you ever do or the worst, and planning makes 
all the difference in the world. 
I use Turbo Tax for the operating system that cannot be named, but 
Intuit has a web quicken as well.  The prior points about keeping good 
records, and keeping two accounts are good - however the only reason to 
do an LLC/S-Corp is for liability protection - and you will pay for the 
privelige in additional bank accounts, filing fees, paperwork, etc.  For 
a simple consulting situation, a sole propriter will be easiest.  Use 
cash based accounting and it's a breeze.  Basically, you're going to 
report cash in as income and cash out as expenses.  This is exactly the 
way that your W2s work.  A simple accounting program should be 
sufficient and you'll be able to spend time making money instead of 
account manipulation.

BTW - Turbo tax will handle a sole propriter just fine, and in many 
cases being an LLC will not shield you since anyone who will loan money, 
lease space, etc. will ask you to personally guarantee your obligations. 

Oh - Finally, I've had good experience with Hawkins, Cloward & Simister 
in Orem.

Good Luck,
-Peter

Sasha Pachev wrote:

> Hello, everybody,
>
> This is going to be less OT than some of the threads have been. If you 
> are a Linux hacker, you might have a consulting business. And if so, 
> figuring out how you pay your taxes is a part of it. So this is 
> somewhat on topic :-)
>
> As some of you may have noticed or heard, I am now a full-time 
> independent consultant for the first time. Things are going well so 
> far, except I need to figure out how I am paying taxes to make sure 
> IRS does not hit me with a fine, and also to make sure I do not pay 
> more than I have to.
>
> Questions:
>
> Does anybody know of a calculator that will tell me based on my 
> expected annual income, family size and estimated deductions how much 
> tax I owe per quarter for both state and federal taxes? I have found 
> one on Intuit site that kind of does it, but it does not do 
> deductions/child tax credit/etc, nor does it do state taxes. (And to 
> keep this on topic, it has to be Linux-compatible).
>
> If I did fine without a CPA when most of my income came from a W-2 
> type job, do I need one now?
>
> Any other tips?
>




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