Sophistocles wrote:

But if you have them, you're no longer an individual.

I can't deduct the fees my LLC paid on my personal taxes (non pass through). And I can't personally pay them for the LLC, unreimbursed.

Right?

Right, but it's because they've already been deducted.

It practical terms it's semantics. It tax terms, it's because the expense came earlier in the income chain.

There was a year that I created a corporation for a very creative tax reason. In the end that approach was abandoned. I don't recall if it was written off as a personal/sole proprietor expense, but I think that it could have been.

Regardless. Conceptually if an individual paid to create a corporation as an individual and it's a legitimate business expense, then they are deductible.

If you don't own a vehicle for business use, you can't deduct it, but it's still a legal deduction if you have the expense. The principle is the same, there's nothing that a corporation is allowed to write off that an individual can't. Neither can write off an expense that they don't incur.

It doesn't get any simpler than that.

Pantelis Palios wrote:
I've read somewhere that the US government has no right to tax income and that a few people know this and don't pay. Maybe it's just for the übber rich? Maybe not?

I'd love to know if it's true?

Yes, there are fringe conspiracy groups who claim this - I'll bet there are even a few in the federal penitentiary after having tried to prove this point with the IRS.

The U.S. Constitution originally disallowed income taxation, however it was brought back to life with the 16th amendment.

John
F2D4

Shy L wrote:

Actually it's almost $10k a year before you have to file if you are filing single under 65.  Even higher for older people, joint returns, head of household, and widow(er).

http://www.irs.gov/Businesses/Small-Bus … Tax-Center

What are My Self-Employed Tax Obligations?

As a self-employed individual, generally you are required to file an annual return and pay estimated tax quarterly.

Self-employed individuals generally must pay self-employment tax (SE tax) as well as income tax. SE tax is a Social Security and Medicare tax primarily for individuals who work for themselves. It is similar to the Social Security and Medicare taxes withheld from the pay of most wage earners. In general, anytime the wording "self-employment tax" is used, it only refers to Social Security and Medicare taxes and not any other tax (like income tax).

Before you can determine if you are subject to self-employment tax and income tax, you must figure your net profit or net loss from your business. You do this by subtracting your business expenses from your business income. If your expenses are less than your income, the difference is net profit and becomes part of your income on page 1 of Form 1040. If your expenses are more than your income, the difference is a net loss. You usually can deduct your loss from gross income on page 1 of Form 1040. But in some situations your loss is limited. See Pub. 334, Tax Guide for Small Business (For Individuals Who Use Schedule C or C-EZ) for more information.

You have to file an income tax return if your net earnings from self-employment were $400 or more. If your net earnings from self-employment were less than $400, you still have to file an income tax return if you meet any other filing requirement listed in the Form 1040 instructions (PDF).

R Michael Walker wrote:

http://www.irs.gov/Businesses/Small-Bus … Tax-Center

What are My Self-Employed Tax Obligations?

As a self-employed individual, generally you are required to file an annual return and pay estimated tax quarterly.

Self-employed individuals generally must pay self-employment tax (SE tax) as well as income tax. SE tax is a Social Security and Medicare tax primarily for individuals who work for themselves. It is similar to the Social Security and Medicare taxes withheld from the pay of most wage earners. In general, anytime the wording "self-employment tax" is used, it only refers to Social Security and Medicare taxes and not any other tax (like income tax).

Before you can determine if you are subject to self-employment tax and income tax, you must figure your net profit or net loss from your business. You do this by subtracting your business expenses from your business income. If your expenses are less than your income, the difference is net profit and becomes part of your income on page 1 of Form 1040. If your expenses are more than your income, the difference is a net loss. You usually can deduct your loss from gross income on page 1 of Form 1040. But in some situations your loss is limited. See Pub. 334, Tax Guide for Small Business (For Individuals Who Use Schedule C or C-EZ) for more information.

You have to file an income tax return if your net earnings from self-employment were $400 or more. If your net earnings from self-employment were less than $400, you still have to file an income tax return if you meet any other filing requirement listed in the Form 1040 instructions (PDF).

Thanks Mike ~ this has been most helpful! I am still going to visit a CPA

Floofie wrote:
I have recently found myself in a position to quit my second (very part-time job,) but simply not filing any income for 2013 scares me! I'm already a full-time model, so I'm also afraid of losing a large portion of my income due to heavy self-employment taxation. I know this is a public forum and the IRS could probably find it if they wanted, so I understand if you don't wish to divulge, but I'd love to know other models' experiences....

Please PM if you'd rather keep it private.

Do you pay taxes or do only under-the-table work? (This is for non-agency work of course.)

Floofie knows me.

My photography brings in a little revenue from my web site.  I do have a business license (which costs me a little), and I do deduct some expenses and pay taxes on my revenue.  In my case, since this is mostly a hobby for me, my photography-related taxes don't amount to a lot. 

I just do this because it's the right thing to do.

If you are just getting by, your legitimate expenses (which you could deduct) might lower your adjusted gross income to a point where you wouldn't be paying a lot of taxes anyhow.  You are right -- see a CPA.

Pantelis Palios wrote:
I've read somewhere that the US government has no right to tax income and that a few people know this and don't pay. Maybe it's just for the übber rich? Maybe not?

I'd love to know if it's true?

You know who says that?  Conspiracy freaks that don't want to pay their income tax.

Small Fruit Pits wrote:
At a $400 a year income threshold to file.......not a guess.

Shy L wrote:
Actually it's almost $10k a year before you have to file if you are filing single under 65.  Even higher for older people, joint returns, head of household, and widow(er).

Better check with your CPA again. You're comparing apples to oranges.

Sophistocles wrote:

There is nothing illegal being discussed, yet. There are perfectly legal ways to avoid or mitigate taxes.

Chill.

and then there's responses like this.. WOW, just WOW.

Of COURSE I pay taxes on every dollar I receive as income..whether that be from my website, my modeling, paypal, tips, etc. And I suggest you do too, and stop starting public conversations like this one. Get yourself an accountant and ask them why this was a very bad idea if you don't believe me.

Faces2Die4 Photography wrote:

Yes, there are fringe conspiracy groups who claim this - I'll bet there are even a few in the federal penitentiary after having tried to prove this point with the IRS.

The U.S. Constitution originally disallowed income taxation, however it was brought back to life with the 16th amendment.

John
F2D4

there are definitely prison residents who have tried to use the "unconstituional" income tax excuse!

ArtGlo wrote:

there are definitely prison residents who have tried to use the "unconstitutional" income tax excuse!

Wasn't Wesley Snipes one of them?

Christina__Smith wrote:
I've done my fair share of filing taxes under "self employment". There are so many right-offs you would probably show a loss at the end of the year and not end up paying much of anything in taxes.

Things to consider:

hair, nails, makeup, clothing, tanning, travel expenses, car mileage, nutritional supplements, gym membership...anything that can even remotely be related to how you look gets written off.

Not all clothing. Only clothing that can not be worn in personal life and that can only be used for work. That narrows it down to uniforms and costumes.

Aaliyah Love wrote:
LOL! Are you seriously asking people to publicly admit that they DON'T PAY TAXES ON THE INCOME THE RECEIVE? These forums get more ridiculous every time I visit them..smh


and then there's responses like this.. WOW, just WOW.

Of COURSE I pay taxes on every dollar I receive as income..whether that be from my website, my modeling, paypal, tips, etc. And I suggest you do too, and stop starting public conversations like this one. Get yourself an accountant and ask them why this was a very bad idea if you don't believe me.

Maybe you should get an accountant who will explain to you that you don't owe taxes on every dollar of income.

Faces2Die4 Photography wrote:
As an attorney, my advice is to avoid phrases like "under the table" (cause that's where the IRS trolls lurk).   

As an attorney, you should know better than making public forum posts starting with the words: "As an attorney, my advice is"

Floofie wrote:
my intent is to do the correct thing legally -
I make just enough to survive and not much more.

You need a good accountant to help you understand what it means to be self employed. You do realize that travel, makeup, educational expenses (modeling classes), books, magazines, computer, phone, website expenses, prints, business cards, home office expenses...and more...are deductible and could mean you wouldn't owe as much as you think.

You don't want to screw with the IRS. It could cost you your car, savings, income and more. There are red flags and plenty of ways for them to discover anyone that is defrauding the government. All it takes is for them to audit a photographer or other business you might have worked for and then they follow the trail to the models. It isn't far fetched at all.

MC Photo wrote:

Maybe you should get an accountant who will explain to you that you don't owe taxes on every dollar of income.

I have a great accountant. And half of the posts in this thread are LOL worthy and I really hope you take them with a grain of salt and consider where they are coming from. But most of the posts in this entire forum seem to lack common sense, so I shouldn't be that surprised.

John Allan wrote:

As an attorney, you should know better than making public forum posts starting with the words: "As an attorney, my advice is"

Sheeeeesh, lighten up!

I guess you're referring to Rule 1.05 of the Texas Disciplinary Rules of Professional Conduct. Of course it only applies to the confidentiality of my communications with clients and former clients - the young lady is neither.