Tax Law (Questions About Taxes)/commission with no 1099

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Question
The company I had worked with essentially closed. I was able to move work to various other companies but instead of commission I captured the entire payment, took my 10%, and paid the companies for production and shipping costs.  (Example: $ 1500. invoice to client, cost to me $ 1450., my income $ 150., payment to company of $ 1450.) In the past with 1099 it was simple - 1040, schedule C,schedule SE,...how would I proceed with this or best to turn over to tax person? (total income is minimal $ 4,000)

Answer
If you want to keep things similar to how they are, are going to increase the Gross Revenue on your schedule C and have a high cost of goods sold. You'll still net your $150 and pay taxes on it.

At these revenue levels it may not be worth making changes that would reduce your taxes, but if your revenues increase, then taxes can be a significant consideration that you may be willing to make changes for.

Richard Fritzler

p.s. Just turning it over to someone that may not make good decisions is not normally a good idea. I'm not saying that all accountants make bad decisions. Some do, and you can never be sure which one you might have. You can/should get input from people that may be able to expand your knowledge so you can make better decisions.  

Tax Law (Questions About Taxes)

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Richard Fritzler

Expertise

Specializing in Business and Corporate taxation. Comparing the advantages and requirements of different business entities, such as Sub-S Corporations, LLC`s, Partnerships (Both Limited and General), Doing Business as a Sole Proprietor, or Using a C-Corporation. Issues regarding K-1 distributions, 1040, schedule C, 1120, 1120s. Are you considering domiciling a Corporation in a low tax state? I can review the benefits and misinformation that exists.

Experience

I have been in the business of assisting business owners in reducing their taxes and liability since 1986.

Organizations
National Small Business Owners Association.
Publications
Contributing author to "The Corporate Standard Newsletter".


Publications
Contributing author to "The Corporate Standard Newsletter".
Ezinearticles.com articlesbase.com

Education/Credentials
I have been in the business of assisting business owners in reducing their taxes and liability since 1986.

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