Go To Great Panes

I’ve seen lots of posts with confusion about the new 1099 Paypal is sending to some sellers. Here’s the scoop:

• The 1099 Paypal is sending out is only fulfilling their obligation under a new law, it has nothing to do with whether or not you are required to file income taxes.
• Paypal will only be sending it to people who bring in at least $20,000 AND have 200 or more transactions through PP.
• Regardless as to whether or not Paypal (or other company) sends a seller this form, the seller must report income for their business if they meet the IRS’s requirements for filing a return.

Do you meet the requirements? Generally speaking, if you have to file income tax for any reason (day job, filing jointly w/ spouse, etc) you must report all your income on your taxes. If you have at lest $400 profit from your small business, you will most likely need to file. Your best bet is to get info about whether or not you need to file directly from the IRS–this post should help:

And if you do need to file, this post will help with getting & adding up your income/expense info from Paypal:

This one will help when you are filling out the schedule C to report your small business income:

Turbo Tax: Many folks ask about whether or not they need to get the Home & Business version of TurboTax. I haven’t tried that version myself, but I do know that with Turbo Tax Deluxe, you can use the ‘add a form’ feature and add the schedule C to your taxes.

The interview process in the TurboTax Deluxe does cover the schedule C once you add it, but their website implies that the home & business version has more help for filling the schedule C out.

Income tax is totally separate from sales tax requirements for your business. See here for help with sales tax & business registration:

Go To Great Panes, Kathryn Maloney ©2012
(This post is copyrighted–you do not have permission to repost this content elsewhere but you are welcome to link to it if you’d like to share the information.)

Go To Great Panes, Kathryn Maloney ©2011
This post is copyrighted–you do not have permission to repost this content elsewhere but you are welcome to link to it if you’d like to share the information.

I’ve seen lots of folks posting about the new California sales tax law and the same type of law in a few other states (like IL, AR CT, NC…), and there seems to be a lot of confusion–not unlike the confusion back in 2008 when NY instituted a similar law (read more about that here).

Hopefully this post will help keep you from getting caught up in the hype & put you at ease a bit.

*Amazon is suing NY over their new 2008 sales tax law to try and keep from being required to collect NY sales tax and that’s where the reference to Amazon tax laws comes in. Amazon has affiliates in New York and NY has re-defined nexus to include affiliates located in NY, which means under the new law Amazon must collect & remit NY sales tax on NY-shipped orders because they also ship more than $10,000 a year to NY addresses.

Other states that have added similar laws have had their affiliates removed by Amazon so that Amazon doesn’t have to collect sales tax for those states until the NY lawsuit is settled (rather than Amazon suing every state who has created a similar new legal definition for a business nexus).

Go To Great Panes, Kathryn Maloney ©2011
This post is copyrighted–you do not have permission to repost this content elsewhere but you are welcome to link to it if you’d like to share the information.

It can come in handy to have a phone number for your small business, but it can be expensive to have a separate land line or cell phone when you are just starting up.

I’m a big fan of personal privacy so I definitely was not interested in giving out our home number (especially knowing this about tax registration).

Looking to keep expenses at a minimum we looked to online services and decided to try Magic Jack which has worked well for us:

http://www.magicjack.com

It’s a bit cumbersome as a program starting it up (and plugging a phone into the computer) but for less than $75 we got a phone number that’d be just for the business for at least 5 years including a voicemail account and free domestic calls (and free directory assistance, call waiting, three-way calling and call forwarding).

If we don’t have the Magic Jack phone hooked up or the computer is offline, callers can leave us a voicemail. When that happens we get an email with the voicemail attached that I can listen to right from my email inbox. If I don’t have internet access I can call and get my voicemail using any phone.

If I need to call a customer, I just plug the MagicJack & phone into the front USB port on my computer and it works like any other phone.

A free option would Google Voice which wasn’t around yet when we got our phone number through Magic Jack:

https://www.google.com/voice

We’ve since gotten a Google Voice account and I’ve used it a few places though I am hesitant to make the number our primary number for business since I don’t know if Google will continue the service or keep it free (and we just don’t need to pay for second phone number for the business).

It gives you a phone number and free calls within the US & Canada but I’ve never tried to use it to make an outgoing call with it myself.

One cool thing about Google Voice is that when I get an email about a voicemail it includes a text transcript of the message. It’s sometimes a little off, but it does give me the general gist without having to turn on the speakers for the computer (we like our computer to be quiet–scares the daylights out of me when I use someone else’s computer and it makes noise, LOL).

Another affordable option through the computer is Skype:

http://www.skype.com

There’s a reasonable fee with different features depending on which service you choose. I’ve found their tech support to be difficult (really, no phone support line??), but if the phone line & billing are working well it’s a good tool.

This post is copyrighted–you do not have permission to repost this content elsewhere but you are welcome to link to it if you’d like to share the information.

Go To Great Panes, Kathryn Maloney ©2011
This post is copyrighted–you do not have permission to repost this content elsewhere but you are welcome to link to it if you’d like to share the information.

Many buyers think that their online purchases are tax exempt, but if their state has sales tax when they purchase locally, they might be mistaken. It’s a common misconception and states are starting to crack down on internet purchases.

In short…: Just because you bought it online doesn’t make your purchase tax exempt. Use tax is what you owe your state when you should have paid sales tax but didn’t.

Go To Great Panes, Kathryn Maloney ©2011
This post is copyrighted–you do not have permission to repost this content elsewhere but you are welcome to link to it if you’d like to share the information.

I’ve grouped all the info I’ve posted for NY businesses in one easy to find place–find this page any time using the gold link on the right side of the page:

If you need help with sales tax & business laws for 33 other states in the USA, please see here:

Don’t see your state? Leave a comment on that post and I’ll update it as soon as possible for you.

There’s so many people asking if they need to report their online income on their income taxes that I thought linking to this IRS app that will help you determine if you need to file (or if you should because of a benefit to you even though you don’t have to) might be useful.

It is set up for tax year 2009, but should still give you a good idea if you need to file:

There are other questionnaires like this on the IRS site too:

If you need to file, you’ll need to report all your income. The following post should be helpful to you:

Visit our Etsy shop: GoTo

It’s that time of year! Lots of folks looking for info on getting their records ready for income taxes–the links below should help. (Links open in a new window.)

Go To Great Panes, Kathryn Maloney ©2011
This post is copyrighted–you do not have permission to repost this content elsewhere but you are welcome to link to it if you’d like to share the information.

Visit our 2nd Etsy shop: GoToSupplies

A little plus for USA sellers who have registered their businesses–amid the updates of our Sales Tax & Business Registration–Official State Website Links page…:

If you shop at Jo Ann Fabric and Craft stores, and you’ve registered for a state sales tax id number or otherwise registered your business with your state, you are eligible for a VIP discount card that entitles you to 10% off your purchases, in addition to purchasing many supplies exempt from sales tax in most states (so long as the supplies are for use in your business).

See all the details here on their website:

You are also eligible if you are part of a Sewing/Crafting Organization, an NPO or can prove you are an interior design professional.

Hope that helps increase your profits!

Go To Great Panes, Kathryn Maloney ©2010
This post is copyrighted–you do not have permission to repost this content elsewhere but you are welcome to link to it if you’d like to share the information.

The Sales Tax & Business Registration link page is up to 22 states now, & new links have been posted for some of the states that were already there:

If a state isn’t there and you’d like to see links please leave a comment with the state and I’ll add it to the top of my list!

I’ve updated the new Sales Tax & Business Registration link page–we’ve now got info for these states too:

Colorado
Tennessee
Texas

If a state isn’t there and you’d like to see links please leave a comment with the state and I’ll add it to the top of my list!