a) if I am going to be taxed 0 based on my 00 income, and I donate , I will only have to pay the government
or
b) if I am going to be taxed 0 based on my 00 income, and I donate , I get to "pretend" that I only made 90 and they then change how much i am taxed (.50 in this case)

Also, do different rules apply for businesses and individuals?

property for the year ended 30 June 2010:

_ He paid 0 on 24 October 2009 to his tax agent to lodge his income tax return for the

2009 income year.

_ He paid 00 in borrowing expenses on 1 February 2010 to his bank for a 12 year loan

to purchase a new rental property that commenced earning income on that day.

_ He paid 50 in insurance premiums on his business premises on 1 May 2010 for

insurance cover to 30 April 2011.

_ He paid 00 for six months supply of stationery to use in his business on 13 June

2010. The stationery was delivered on that day and he had 00 of that stationery on

hand at 30 June 2010.

Assuming that Joseph is not eligible to be a small business entity (SBE) what amount can

Joseph claim as deductions (to the nearest dollar) for the year ended 30 June 2010?

A:91.

B:50.

C:50.

D50.

E:92.

2. During the year employers set aside a certain amount of money, called ____, from their employees’ wages.
securities
tax shelter
withholding
dependent tax

3. These are government financial instruments that include bonds, notes, and certificates.
corporate income taxes
securities
excise taxes
customs duties

4. When the government’s spending is greater than its income, it creates a
national debt.
government securities’ risk.
withholding situation.
national taxable income.

5. To raise revenue and pass appropriations is the power of
the Supreme Court.
the people.
Congress.
the president.

6. The idea that the best forecast of this year’s budget is last year’s, plus a little more, is called
reconciliation.
incrementalism.
policy budget-making.
fiscal year budget-making.

7. The IRS checks some tax returns more carefully than others during
entitlements.
discount rates.
uncontrollables.
audits.

8. A 12-month accounting period is called a
deficit year.
revenue year.
monetary year.
fiscal year.

9. An example of an entitlement program is
Social Security.
corporate tax.
tax loopholes.
individual income tax.

10. The yearly sum of goods and products produced in a country is called the
deficit.
gross national product.
uncontrollables.
entitlements.

11. The United States economy is a
regressive tax economy.
market economy.
fiscal policy economy.
monetary policy economy.

12. An individual’s total income, minus certain deductions and personal exemptions, is called the
excise tax.
withholding.
social insurance tax.
taxable income.

So here’s the story. I’ve always been pretty entrepreneurial, doing some freelance writing, ebay selling, babysitting, event planning, stuff like that. For 2009, though, my primary income, in addition to waitressing, was 1) babysitting and 2) advertising/marketing writing–to be specific, working on commission to sell stuff for folks. I kept TERRIBLE records (i.e. none), not because I was trying to be dishonest or piss of the IRS, but because I just didn’t think about it. So you can imagine what a disaster my trying to file this year has been! The only good records were from the waitressing job–about k–which has been the majority of my income. Other tax form areas I saw and for which I REALLY wished I had better info: medical expenses and charity. If I’d kept better records for both, I think taxes could have been SIGNIFICANTLY less than they turned out to be (about k total (federal and state), but even more–about 00–before I fix the error i made when sending in the first return. I think this is called an amendment…will this increase my chances of an audit?)

I also found out I’m supposed to pay quarterly estimated taxes, which I will start doing as soon as i get the error straightened out.

So here’s my basic question. Starting now through the end of the year (and beyond, of course:)), I plan on keeping very good records. I’ll be keeping track of:

1) medical expenses
2) charity work/donations

For these I’m confused about several things. First, the standard deduction? I heard I should usually take this for medical and charity, and that medical has to be at least 7.5% of income to qualify (which mine always is).

Then there’s the ever-intimidating:
3) Business finances.

As I understand it, I am considered to "own" two different businesses. One is babysitting (which I do in the family’s home), the other, "advertising/marketing services."

For babysitting, the kids live a quarter mile from me, so I’m not planning on trying to figure out deductions related to driving. what I’m planning to do in for this is just record each time I get paid (day and amount), and my expenses (almost all of which are me buying stuff for the kids during the day–the parents reimburse me for those when I get paid, so I’ll just make a note of them.)

For the writing/advertising, though, it gets a bit more complicated. Sometimes I take on big projects for folks who are losing their homes and need everything out by a specific date. For instance, last month I did a 3 1/2-week job for a guy who owned a four-bedroom house, everything still inside. I coordinated estate sales, private sales, listed stuff on craigslist and in different forums, etc. The guy lived almost 30 miles away, and I was constantly driving back and forth to meet potential buyers. On several occasions I also had to hire folks to help with the sales when I couldn’t be there at a specific time. There were lots of miscellanious expenses, etc. and some people we even paid in "stuff."

What I’m planning to do for this second biz from now on is to record each time a sale is made, what my commission is (if it’s not something I bought to re-sell), and what my expenses are. I’ll also try to log mileage as it occurs.

As for other deductions, I think it might be a good idea to just leave those alone, because almost everything I use for my business (computer, car, etc.) is also for personal use. So that whole "home office" deduction would definitely not apply, because my "office" is the computer in my bedroom (and I don’t pay rent), and my "inventory," when I’m buying and re-selling rather than just working on commission, is just piles of whatever stuff it is I’m marketing.

When it comes time to file those 2010 taxes, is this going to be pretty much the majority of what I’ll need? Other than the w-2 from my waitressing job and the (miniscule) statement from my stock shares, have I covered everything I’ll need? and if not, what else should I be aware of? I want to make sure NOTHING like this EVER happens again!!!

Thank you so much for any input you can provide!

"GE had plenty of earnings last year — just not in the United States. For tax purposes, the company’s U.S. operations lost 8 million, while its international businesses netted a .8 billion profit.

That left GE (GE, Fortune 500) with no U.S. profit left for Uncle Sam to tax. Corporations typically face a 35% federal income tax on their earnings. Thanks to its deductions and adjustments, GE reported an actual U.S. federal income tax rate of negative 10.5%. It got to add a "tax benefit" of .1 billion back into its reported earnings."

http://money.cnn.com/2010/04/16/news/companies/ge_7000_tax_returns/index.htm?cnn=yes&hpt=T2

Regarding the GE Bailout: http://www.washingtonpost.com/wp-dyn/content/article/2009/06/28/AR2009062802955.html?hpid=topnews&sid=ST2009062803183