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What Should I charge people?

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  • #16
    I was grumbling to my accountant about the tax I was going to have to pay on some transaction and his reply to me was "Yes, they will tax you but they never take all of it.....at least not yet." So, undercharging for you work is a pretty naive way of tax avoidance. Charge what you're worth and pay the tax you owe. Your accountant (you should have an accountant if you're in business) can help you over the rough spots and keep them from "taking it all."

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    • #17
      Originally posted by AwesomeAlbert View Post
      I want to go legit but here is my theory...I had to work my ass off to save enough money to buy equipment, a truck, and paying for living expenses while being taxed. And now the government gets to double tax me for everything that I have accomplished? To **** with that. Its Un-American and I will not Stand for it. I do not want to go into politics, this is a welding forum. And I Guaran-god****-tee you that 90% of millerwelds forums are not liberals, so you catch my drift.
      If you go legit the equipment and truck you've already purchased will be business assets. As such they follow a depreciation schedule. This depreciation comes off the top line along with a whole bunch of other expenses thereby reducing your taxable bottom line. In essence Uncle Sam will pay for your equipment.

      On the other hand if you do it your way you will be double taxed. And besides not being legit you will be guilty of tax evasion. So, I would call an accountant who handles businesses and tell him what you want to do. He/she may very well be willing to chat with you for free so you started on the right foot in the hopes of getting your business later.
      Good luck!

      PS: Death and taxes transcend conservatism and liberalism alike.

      Comment


      • #18
        Originally posted by Sberry:310324
        Charge just enough to give them a heart attack and not quite enough to kill them.
        Love it. Pretty much the definition of Capitalism. :-)
        =======================
        Miller 211 AutoSet
        Miller Dynasty 200 DX
        Thermal Dynamics Cutmaster 42

        "The Sleep of Reason Produces Monsters"
        Francisco Goya

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        • #19
          Originally posted by Arizona Joe View Post
          If you go legit the equipment and truck you've already purchased will be business assets. As such they follow a depreciation schedule. This depreciation comes off the top line along with a whole bunch of other expenses thereby reducing your taxable bottom line. In essence Uncle Sam will pay for your equipment.

          On the other hand if you do it your way you will be double taxed. And besides not being legit you will be guilty of tax evasion. So, I would call an accountant who handles businesses and tell him what you want to do. He/she may very well be willing to chat with you for free so you started on the right foot in the hopes of getting your business later.
          Good luck!

          PS: Death and taxes transcend conservatism and liberalism alike.



          Here is what happens when you try to start up a legit business.

          You buy equipment, more equipment, advertise and more etc.

          You file your taxes, assets / cost are deprecated but over a few or more years while also buying more equipment. You show a lose because you didn't make more money than you spent, so the deprecation amount is more than you made.

          Three years of this shows your not a legit business but more of a hobbyist. Tax man says close the business, but keep trying and if you make money you have to reopen the business and pay tax.

          What the he##, what if I make less than the deprecation of the assets plus the stuff I'm still buying? I can't keep showing a lose but I must pay tax because I made money???

          The way I look at it, is keep everything,, receipts. Make money but until you can make enough to pay tax on which is over what your cost deprecation are, you can't call it a business. TAX man don't call it a legit business until you can pay tax on it.

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          • #20
            Originally posted by Arizona Joe View Post
            In essence Uncle Sam will pay for your equipment.


            No, Uncle Sam allows you to pay for your equipment with pre tax dollars. Big difference there.

            J
            Some days you eat the bear. And some days the bear eats you.

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            • #21
              Originally posted by JTMcC View Post
              No, Uncle Sam allows you to pay for your equipment with pre tax dollars. Big difference there.

              J
              Yes, of course.

              Comment


              • #22
                Originally posted by Hardrock40 View Post
                Here is what happens when you try to start up a legit business.

                You buy equipment, more equipment, advertise and more etc.

                You file your taxes, assets / cost are deprecated but over a few or more years while also buying more equipment. You show a lose because you didn't make more money than you spent, so the deprecation amount is more than you made.

                Three years of this shows your not a legit business but more of a hobbyist. Tax man says close the business, but keep trying and if you make money you have to reopen the business and pay tax.

                What the he##, what if I make less than the deprecation of the assets plus the stuff I'm still buying? I can't keep showing a lose but I must pay tax because I made money???

                The way I look at it, is keep everything,, receipts. Make money but until you can make enough to pay tax on which is over what your cost deprecation are, you can't call it a business. TAX man don't call it a legit business until you can pay tax on it.
                Have you ever run a business??
                Have you ever filed your own taxes on a business if you ran one??
                By your comments I don't think you have on either question therefore how can you give advice???
                Not trying to be an a@$, but what you said made no sense.
                JIM

                Owner Operator of JNT Mobile Welding & Repair LLC
                Millermatic 350P Aluma Pro
                Dynasty 200DX
                Maxstar 150 STL
                Trailblazer 302
                Suitecase 12RC
                Extreme 12VS
                Extreme 8VS
                Spoolmatic 30A
                Miller HF251D-1
                Passport Plus
                Spoolmate 100
                Hypertherm Powermax 45 and 85
                Ingersoll Rand Engine Driven Compressor
                Dake 75 ton H-Frame Press
                JD Squared Model 32 Bender
                Miller Digital Elite

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                • #23
                  Originally posted by Arizona Joe View Post
                  Yes, of course.


                  Well it's a shame, because if the govt bought my equipment I'd have a monster truck, a helicopter and a main battle tank parked in the front yard, all with a welding machine tucked in somewhere of course : )

                  J
                  Some days you eat the bear. And some days the bear eats you.

                  Comment


                  • #24
                    Originally posted by JTMcC View Post
                    Well it's a shame, because if the govt bought my equipment I'd have a monster truck, a helicopter and a main battle tank parked in the front yard, all with a welding machine tucked in somewhere of course : )

                    J
                    The government will not buy your equipment if you are a hard working business owner. However it is free if you are one of the following.

                    Don't like to work or work hard at doing nothing, are not here legally, can have a baby every 9-10 months, have a really stupid idea to qualify for the study of something, etc.
                    MM250
                    Trailblazer 250g
                    22a feeder
                    Lincoln ac/dc 225
                    Victor O/A
                    MM200 black face
                    Whitney 30 ton hydraulic punch
                    Lown 1/8x 36" power roller
                    Arco roto-phase model M
                    Vectrax 7x12 band saw
                    Miller spectrum 875
                    30a spoolgun w/wc-24
                    Syncrowave 250
                    RCCS-14

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                    • #25
                      Originally posted by MMW View Post
                      The government will not buy your equipment if you are a hard working business owner. However it is free if you are one of the following.

                      Don't like to work or work hard at doing nothing, are not here legally, can have a baby every 9-10 months, have a really stupid idea to qualify for the study of something, etc.
                      I will have to second that.
                      JIM

                      Owner Operator of JNT Mobile Welding & Repair LLC
                      Millermatic 350P Aluma Pro
                      Dynasty 200DX
                      Maxstar 150 STL
                      Trailblazer 302
                      Suitecase 12RC
                      Extreme 12VS
                      Extreme 8VS
                      Spoolmatic 30A
                      Miller HF251D-1
                      Passport Plus
                      Spoolmate 100
                      Hypertherm Powermax 45 and 85
                      Ingersoll Rand Engine Driven Compressor
                      Dake 75 ton H-Frame Press
                      JD Squared Model 32 Bender
                      Miller Digital Elite

                      Comment


                      • #26
                        What Should I charge people?

                        ^^ they will give you a free cell phone too. :-)

                        Comment


                        • #27
                          Originally posted by Hardrock40 View Post
                          Here is what happens when you try to start up a legit business.

                          You buy equipment, more equipment, advertise and more etc.

                          You file your taxes, assets / cost are deprecated but over a few or more years while also buying more equipment. You show a lose because you didn't make more money than you spent, so the deprecation amount is more than you made.

                          Three years of this shows your not a legit business but more of a hobbyist. Tax man says close the business, but keep trying and if you make money you have to reopen the business and pay tax.

                          What the he##, what if I make less than the deprecation of the assets plus the stuff I'm still buying? I can't keep showing a lose but I must pay tax because I made money???

                          The way I look at it, is keep everything,, receipts. Make money but until you can make enough to pay tax on which is over what your cost deprecation are, you can't call it a business. TAX man don't call it a legit business until you can pay tax on it.
                          Technically you can't do that because the " legit" part pertains to the tax credits they give you. So... If you make money, actually Charge , they don't really care if you make money- you are taxed on that transaction. Not immediately like a sales tax you see at a store but it is there floating in the ether of accounting to come due at tax time.
                          In very basic lingo ... At the end of the year you add up all yer money and then figger out what you owe on that income. You get to deduct all of your business expenses towards that dollar amount which reduces your total income which reduces what you then owe the gubment .
                          They give you a 5 year window for start up because there are more expenses during start up which can affect your income in to the red. This gives you a zero tax payment.
                          Hobby Loss Rule of Thumb. If a business reports a net profit in at least 3 out of 5 years, it is presumed to be a for-profit business. If a business reports a net loss in more than 2 out of 5 years, it is presumed to be a not-for-profit hobby.
                          They give you options on how you wish to offset big ticket items but after 5 years if you keep showing a loss then they'll climb up your arse and ask WTF? You can't keep buying equipment and supplies forever and not make any money.
                          Ed Conley
                          http://www.screamingbroccoli.net/
                          MM252
                          MM211
                          Passport Plus w/Spool Gun
                          TA185
                          Miller 125c Plasma 120v
                          O/A set
                          SO 2020 Bender
                          You can call me Bacchus

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                          • #28
                            Another thing about the Hobby thing is that if the IRS decides that it is in fact a hobby you the owe them all of the tax money you didn't pay for those 3 years because you were calling it a business.

                            😁
                            Ed Conley
                            http://www.screamingbroccoli.net/
                            MM252
                            MM211
                            Passport Plus w/Spool Gun
                            TA185
                            Miller 125c Plasma 120v
                            O/A set
                            SO 2020 Bender
                            You can call me Bacchus

                            Comment


                            • #29
                              Originally posted by JTMcC View Post
                              Well it's a shame, because if the govt bought my equipment I'd have a monster truck, a helicopter and a main battle tank parked in the front yard, all with a welding machine tucked in somewhere of course : )

                              J

                              What I wrote was,

                              "This depreciation comes off the top line along with a whole bunch of other expenses thereby reducing your taxable bottom line. In essence Uncle Sam will pay for your equipment. "

                              I thought it was clear that the money came from savings in taxes... unless you take the sentence out of context.

                              Comment


                              • #30
                                Originally posted by Arizona Joe View Post
                                What I wrote was,

                                "This depreciation comes off the top line along with a whole bunch of other expenses thereby reducing your taxable bottom line. In essence Uncle Sam will pay for your equipment. "

                                I thought it was clear that the money came from savings in taxes... unless you take the sentence out of context.
                                It was clear- jt was funnin' with the tank stuff
                                Ed Conley
                                http://www.screamingbroccoli.net/
                                MM252
                                MM211
                                Passport Plus w/Spool Gun
                                TA185
                                Miller 125c Plasma 120v
                                O/A set
                                SO 2020 Bender
                                You can call me Bacchus

                                Comment

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