Introduction

This post is about federal tax returns, and it does not matter if your returns are done by hand, using an income tax preparer, or if you do taxes online. Also, be aware that there is special income tax help for senior citizens available. As a last resort, you may also visit the IRS’s federal income tax website at https://www.irs.gov/ if you have questions or other concerns about your taxes. However, be warned that, because of the complexity of our tax system, you may not receive a completely accurate response from the IRS…trust me…it’s already happened to me and to others.

One other thing: When starting a business of any type, contact your local and state authorities governing such matters to determine your legal requirements for running said business. Be sure your zoning laws will permit the business. The last thing you need is trouble from the authorities.

***Disclaimer***

I am not an accountant or tax expert, nor do I pretend to be. My intention is not to give you tax or accounting advice. My intention is to make you aware of various issues that becoming a business owner brings about, so that you know what questions to ask and try to get answers to from a person who is more qualified than me and knows your individual situation better than me.

***End Disclaimer***

I completed my income taxes early this year (first week in February) for the first time in about 10 years. Traditionally, I normally wait until the last possible moment to file, even if I complete them earlier (just my quiet, personal protest for having to pay so much in taxes). In this post, I have put together some Income Taxes Info to help you who have yet to file for 2017 (in the USA), and in some cases, even if you've already filed. It isn’t the amount of taxes taken out of paycheck that matters, in the end; rather, it’s how much of that “tax” money you ultimately DON’T have to pay. Having a home-based business is one of the best income-tax-reducing vehicles available to the average person. Wealthy Affiliate is perfect for that purpose.

Back when I was still in the US Air Force, I served as a VITA representative for several years (Volunteer Income Tax Assistance) doing taxes for my fellow Air Force comrades. As such, I became comfortable with tax issues. Since then, I’ve done my own taxes each year, but for the last 8 or 9 years, I’ve used an online tax service (TaxAct, H&R Block, and TurboTax).


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LynnB1 Premium
My best friend is a CPA so I don't worry about it.
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Joshua2765 Premium
Don't ever lose that friend! Lol!

Awesome!
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Steven-A Premium
thanks. i always used a tax lawyer but did it myself last year and this year. it wasn't that hard.
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Joshua2765 Premium
You did it exactly like it SHOULD be done, Steven. Let a pro show you the ropes in the beginning. Once you've seen it done a few times, it is relatively simple.

Continued success,

Joshua
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Steven-A Premium
Thanks, Joshua. It's always easier to follow the path
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JerryMcCoy Premium Plus
Great post and information.
Jerry
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Joshua2765 Premium
Thanks, Jerry.

Best to you,

Joshua
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pitofly Premium
Thanks for this training! I usually use TurboTax.
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Joshua2765 Premium
Great program. That's the one I used for my 2017 filing (completed this year). Thanks for checking out the training, by the way.

Continued success,

Joshua
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sdawson Premium
nice training. I had a legal single entity LLC for several years, but for all those years I did not make a profit. I did claim expenses, pay for the state and city business license, submit sales taxes online, and all. But after several years with no profit, my CPA's told me to close down the business, I only had a hobby. So I'm a hobbiest right now until I need to become a business again. Sometimes it can be so confusing when you are trying to do it all legal even.
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Joshua2765 Premium
Shirley, did you file a business return in those early years? The IRS allows you to claim a loss for a few years, but here is the general rule:

"The general rule is that if you have not turned a profit in at least three of the prior five years, the IRS will categorize your business as a hobby. This may be extended to a profit in two of the prior seven years in the specific case of horse training, breeding or racing."

Also, how long ago was that? You are able to file an amended return for up to three years after the due date of the original return (File IRS Form 1040X).

Finally, your WA business has nothing to do with those other businesses. You are legitimately operating an internet business to make a profit. Thus, you can, and should, treat it as such. If your CPAs are telling you that you cannot claim expenses for your WA business, I'd look for another CPA.

Anyway, wish you continued success,

Joshua
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