One of the most detrimental misconceptions concerning working in Online Marketing is that it is a tax free industry. Men and women enter it thinking that since the money they earn comes to them mainly through online sources like PayPal that they don't need to pay taxes on the things that they've generated. It is false! What's more important is that if you do not pay taxes on this money, you can actually end up in all kinds of trouble! Do not panic, however: it isn't really hard to do taxes when you are an Internet Marketer. Here are some ideas that will help you.
1. Obtain an appointment at your local Small Business Association. Each and every community has some type of small business "helper" organization (often run through a community college) which has trained professionals available to help you both getting your business starting and ensuring all of your T's are crossed and your I's are dotted. What's especially nice is that this resource is just about always without charge.
2. Track everything. Let's say it once more: monitor each and every last detail. This is certainly simple to do through Excel. Put together a spreadsheet and keep track of every last cent you earn with your Internet Marketing business and also one that tracks every single cent you spend on your IM efforts. Make sure you keep every single receipt and invoice for the money you shell out.
3. If you have more than enough funding, engage a professional accountant. This will likely allow you a bit of freedom in the tracking of all of your taxes and online business numbers. You tell your accountant what you've made and paid out (make sure you can prove this with official proof) and they take care of everything else--especially during tax season.
4. Put money toward the taxes that you could owe at the end of the year. A fundamental rule here is to pay in 30% of every sale. You can do this through quarterly Estimated Tax Payments or even monthly with the IRS. The IRS today has the ability to collect estimated tax payments if you think or want to make them. This will keep you from paying a gut wrenching amount at the end of the year (which, if you haven't saved up for it, can be particularly stressful). What is much better is that if you have somehow overpaid through your estimated tax payments, you're going to get a refund just like you would if you were working for a traditional company. Make sure to talk to somebody at the IRS to get this set up the right way.
5. Discover which tax deductions you are allowed to take. When you operate your own business from home, there are a number of things, such as the money you pay in for utility payments, that become tax deductible--just like paying for other business related supplies. Your accountant or someone from the IRS can help you determine what all you can take once it's time for you to pay taxes.
It's not all that difficult to become intimidated by the idea of paying taxes when you are an Internet Marketer. Fortunately, there are all kinds of resources available to help you stick to the law and still keep yourself from losing your shirt to the IRS!
1. Obtain an appointment at your local Small Business Association. Each and every community has some type of small business "helper" organization (often run through a community college) which has trained professionals available to help you both getting your business starting and ensuring all of your T's are crossed and your I's are dotted. What's especially nice is that this resource is just about always without charge.
2. Track everything. Let's say it once more: monitor each and every last detail. This is certainly simple to do through Excel. Put together a spreadsheet and keep track of every last cent you earn with your Internet Marketing business and also one that tracks every single cent you spend on your IM efforts. Make sure you keep every single receipt and invoice for the money you shell out.
3. If you have more than enough funding, engage a professional accountant. This will likely allow you a bit of freedom in the tracking of all of your taxes and online business numbers. You tell your accountant what you've made and paid out (make sure you can prove this with official proof) and they take care of everything else--especially during tax season.
4. Put money toward the taxes that you could owe at the end of the year. A fundamental rule here is to pay in 30% of every sale. You can do this through quarterly Estimated Tax Payments or even monthly with the IRS. The IRS today has the ability to collect estimated tax payments if you think or want to make them. This will keep you from paying a gut wrenching amount at the end of the year (which, if you haven't saved up for it, can be particularly stressful). What is much better is that if you have somehow overpaid through your estimated tax payments, you're going to get a refund just like you would if you were working for a traditional company. Make sure to talk to somebody at the IRS to get this set up the right way.
5. Discover which tax deductions you are allowed to take. When you operate your own business from home, there are a number of things, such as the money you pay in for utility payments, that become tax deductible--just like paying for other business related supplies. Your accountant or someone from the IRS can help you determine what all you can take once it's time for you to pay taxes.
It's not all that difficult to become intimidated by the idea of paying taxes when you are an Internet Marketer. Fortunately, there are all kinds of resources available to help you stick to the law and still keep yourself from losing your shirt to the IRS!
About the Author:
Beside creating articles about Online Marketing Tax, Brandon Lechman also gives advice about Article Marketing Robot on her personal blogs. To understand more about Article Marketing Robot, visit www.kingwarrior.info
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