Hi there! I am currently kicking myself…I’ve REALLY made a mess of my finances and record-keeping. See, I’m over 18, and yet this is the first time I’ve ever tried doing my taxes myself. in the past it’s been 95% my father doing the work, 5% me running around, confused, trying to find forms he says I need and that I don’t remember getting but must have put…somewhere. Now, I highly doubt I’ll ever meet any of you in person, so your opinions really shouldn’t matter, but before I go into this next part I feel compelled to just add here that i am NOT an idiot…well…not usually. When it comes to finances, though, I’m finding that general rule of thumb just doesn’t apply.

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!

From September 2008 to the end of the year, I made exactly 21 in babysitting income. I have no idea at this time if the mother of the child I watch is going to claim him, but after much research I think I must file as an independent contractor. I do the work in my home. The only thing she tells me to do is when to work and what to give him for food.

Question #1. Do I claim the money I earned in December even though I was not paid in December for that money?

Question #2. What are legal deductions I can take and is it worth it? I take him to storytime and Kidz Klub- so could I count that as a driving expense? Also, I must pay for all his food, and the first couple months his diapers/wipes. Are these deductible?

In regards to the ebay business, I sell items I find at the thrift store, in my home (already have from long ago) or things that are given to me by family members. I do this as a hobby. I made around 0.

Question #3. Do I count this as income?

Question #4. I kept very accurate records of what I earned, how much I paid for each item, what it sold for,- all boiling down to profit and loss. How do I report this, and would it be a seperate Schedule C from babysitting?

Question #5. What is deductible? My trips to the post office, paper to print packing slips, my time on the internet to post/list/respond, shipping materials, my trips to the thrift store?

We want to be able to get the most back as possible (as does everyone). We qualify for the EIC credit even with my income from babysitting/eBay. Would it be wise to show a loss?
Question #6. Can I claim part of my rent as an expense since I work out of my home? What about my car payment for either since I partly use it for business?

Lastly, where do I find information about moving expenses and what’s claimable?

I don’t have any license yet, but will get one next week. I’m unemployed so I started selling things around my apartment since a few months ago. And I have also pick up a hobby of crafting, and sell sell the things I made. I was told that I have to file schedule C on internet incomes. I sell my things on ebay and etsy and have all my transaction on paypal. I buy everything and sell everything mainly online. And I also print shipping postage on paypal so I have no paper receipts to keep at all. I upload all my transaction from paypal to outright (Bookkeeping Program) and trying to sort out my expense. I put Shipping fee, paypal, ebay, etsy fees under "Cost of Goods Sold and I also put things that I buy then resell on ebay under "Cost of Goods Sold."

After all the sorting, it shows I have 00 income on the first line. But after all the fees and deductions, I have -0 loss on "Net profit or (loss)"

What’s the point of me filing it when I’m not even making money? Is it really necessary for me file this income? The schedule C s very complicated, but plan to file it with my husband’s tax return.

Turbo tax fee version don’t have Schedule C, so I plan to get the home and business edition. It cost ,95, do you think it’s worth it?

I have been selling few items on ebay and thru craiglist, mostly re-selling items for a profit. I kept an xl sheet document of my costs and money received. I have not registered myself as a small business or self employed. I am (planning to report) the income on our tax returns. Does this qualify me as self employed (so that I can claim dependent care deductions, otherwise I cannot claim – spouse works, I have no w2 & turbo tax wont let me add ebay earnings as income for dep care purposes)

I had 00 in total ebay sales last year. It was for my own private art hobby / business. Due to startups and what not, I had expenses of ,000, so a net loss of 00. Turbo tax states that my risk for an uadit is HIGH, due to my deductions.

Since this was not an income, can or should I just not report it at all?

I have a bunch that I want to get rid of, but I don’t want to simply throw them out and selling them on eBay or craigslist isn’t worth the time. The money I’d get would probably match the deduction I’d get for the fair-market value of the items. So, if there’s a charity that would take them, I could do this and be rid of them, but I can’t think of one that would take them. Certainly not the thrift operations, for moral and probably business reasons (lack of space).

So, can anyone think of a charity that would?

I started a sole proprietor business in 2008 and am calculating values for 2008 federal and state taxes. I buy items, and have them shipped directly to the customers. Can my profit total (before deductions) be after shipping fees, or is that before and the shipping fees are deductible afterward? I really want to do these right, and it’s a big deal because I will have to pay the 15% self employment tax on all profits before deductions. For example…Sally Sue purchased an item from me for 0. It cost me 0 to buy the item and send it to her. But I also paid in shipping costs. SO do I claim as my profits and then have a tax deduction of , or do I claim as my profits? By claiming I’m paying .50 in self employment taxes, but by claiming I’m only paying .50. And when those numbers equal thousands of dollars, it’s a huge difference.
To Morpheus: I do not make profits on shipping, and that is not what the question was. What I am asking is if the government will want me to provide a base profit BEFORE shipping expenses that I paid and then just deduct shipping expenses as a tax deduction OR if they see shipping expenses as something that can be deducted before base profit is recorded. In my example of the customer paying 0 and I pay 0 plus for shipping, that is saying that the customer paid 0 plus shipping, totally 0. I am an eBay seller, and do not condone cushioning shipping charges to make more profit, again that was not what the question was.

I sell items on Ebay but do not consider myself a business. I do report my income, though, as it exceeds 0 and I also take some of the allowable deductions. My question is: Am I allowed to take any and all deductions that apply even though I don’t have a business name or consider myself a business? Income this year: 00.00. Thank you!

I am 15 years old and i would like to start a business. I don’t mean babysitting because i already do that. I don’t mean yard work either. I mean like make products such as decorated cookies, earrings, or bath salts. My real question is what kind of road blocks will i run into because i am so young.

I know of craft shows that i can go to. I asked my mom if she would help me do eBay (meaning her name is on the account so that i can sell because she is WAY behind on the computer stuff) but she said no.

I would like to have a website and sell my items there. Is anything going to get in my way as far as taxes and legal stuff go. Can I leagally ship things. How can I legally receive payments. Does the small buisness tax deduction thingy apply to me.

I would really appreciate legitimate answers. Thank you!

I’m a small time artist. I just started to market my crafts on the web. Naturally there are many expnses with do so. I am an honest person and do file taxes, but also would like to be able to deduct my many expenses, so as not to have to pay income taxes on my total sales. In order to show decuctions to the IRS is a business license required? I basically sell about 00 a month via the web. This is not a lot, it’s just extra pakcet income for me. My expenses total about 0-0 each month. Google ads, website hosting, materials, some ebay fees, credit card prosessing etc.

Also, can I incorporate this income with deductions into my private person tax return, or is a seperate business tax return required?

Thanks!