If you have a small business online, remember throughout the year to keep detailed records for tax purposes. Many people that have small business that might only generate a couple of hundred dollars per month don’t keep good records of their transactions, and this can lead to trouble with the IRS.
Here are some tips to for keeping records of your online business.
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Don’t wait to the end of the year to start gathering your sales and profit figures. It's far wiser to total them at the end of each month to make sure you have a good record of what was sold, what was paid out as expenses and what is considered profit. This way you are not left in the dark on how much you truly earned in income at the end of the year.
Many people don’t consider their profits on Ebay as income, however the IRS does. It's ne thing to sell one or two items during the year, but if you are consistently doing business on eBay and earning income, according to the IRS, you must state that income on your taxes.
So make sure your keep great records during the year and for extra help or information, contact your accountant.
Posted by:
Darrell on Mar 04, 06 @ 11:51 am
The category for this entry is
For Beginners
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