Does the Tax Man care about what we sell to make our living?

LEARNINGONLY · #1 05-28-2018

Will IRs care to ask and question our suppliers, where we get our stuff, how much we got it for exactly?

Ik they audit but have no experience ever getting audited obviously since I don't make enough

does paypal or irs get suspcious when it sees like 30 1099's from different sources of money reporting?

Gladiator · #2 05-28-2018

As long as what you are paying adds up...

LEARNINGONLY · #3 05-28-2018

Quote:

Originally Posted by Gladiator

As long as what you are paying adds up...

Is it true that if audited they need receipts from our suppliers and such?

applebaum · #4 05-28-2018

You should consult an accountant or tax attorney for guidance and/or questions on an IRS audit.

In general - Yes to receipts and invoices. Just like a personal tax audit, if you are claiming it you need to prove it.

Gladiator · #5 05-28-2018

Quote:

Originally Posted by applebaum

You should consult an accountant or tax attorney for guidance and/or questions on an IRS audit.

In general - Yes to receipts and invoices. Just like a personal tax audit, if you are claiming it you need to prove it.

This.

Many businesses have multiple EIN's and subsidiaries, it's not a big deal as long as you keep a record of your income and expenses.

LEARNINGONLY · #6 05-28-2018

Quote:

Originally Posted by applebaum

You should consult an accountant or tax attorney for guidance and/or questions on an IRS audit.

In general - Yes to receipts and invoices. Just like a personal tax audit, if you are claiming it you need to prove it.

Is it just a fine if I was sloppy and never did invoices when buying from people wholesale as a meetup?

Gladiator · #7 05-28-2018

No one can tell you what the IRS will and will not do to you if you get audited and have nothing to back up income and deductions.

Sunspot144 · #8 05-28-2018

You won't get audited. Become one of the multi-million dollar drop-shippers possibly.

LEARNINGONLY · #9 05-28-2018

Quote:

Originally Posted by Sunspot144

You won't get audited. Become one of the multi-million dollar drop-shippers possibly.

So as long as long as I file and the numbers seem right - audit is HIGHLY UNLIKELY with revenue like 200k and below?

If so awesome.

Sunspot144 · #10 05-28-2018

Quote:

Originally Posted by LEARNINGONLY

So as long as long as I file and the numbers seem right - audit is HIGHLY UNLIKELY with revenue like 200k and below?

If so awesome.

Yes - they'll know if there is something fishy if your income is extremely high in relation to your gross sales.

LEARNINGONLY · #11 05-28-2018

Quote:

Originally Posted by Sunspot144

Yes - they'll know if there is something fishy if your income is extremely high in relation to your gross sales.

What if someone says their income is very low and they almost didn't profit at all against COGS?

Sunspot144 · #12 05-28-2018

Quote:

Originally Posted by LEARNINGONLY

What if someone says their income is very low and they almost didn't profit at all against COGS?

Same thing applies. Your profits are small-fry and wouldn't merit an audit. This is fairly common is new businesses anyway

rsot · #13 05-28-2018

This kind of financial discussion is beyond the scope of the forum, just fyi - not sanctioned

LEARNINGONLY · #14 05-28-2018

Quote:

Originally Posted by rsot

This kind of financial discussion is beyond the scope of the forum, just fyi - not sanctioned

Okay do you know anywhere where I can talk about it. Unsure as I need to file in 2018 but never did as a business before.

Yasav · #15 05-28-2018

I can't even imagine how those 1mil+ dropshippers pay their taxes. The net profit they'd claim would only be a tiny fraction of their gross revenue. Although, if they can prove it all, I personally don't see any issues.

yankee · #16 05-28-2018

You are worrying about something that has no answer to or problem with.

Buy items, sell them, make money, report income and pay your taxes. Get audited? so what, who cares? You paid your taxes.

If you are worried about being sloppy, then stop being a hack and get organized. It is not hard.

LEARNINGONLY · #17 05-28-2018

Quote:

Originally Posted by yankee

You are worrying about something that has no answer to or problem with.

Buy items, sell them, make money, report income and pay your taxes. Get audited? so what, who cares? You paid your taxes.

If you are worried about being sloppy, then stop being a hack and get organized. It is not hard.

Ok the Irs auditing with stealth just appears worrying. Believe me I am a hack and an amateur at this online money makin stuff. i plan learning alot on the forum

sax4 · #18 05-29-2018

Bit off topic, not surprised "The Taxman" hasn't been replaced by "Tax Person" feminists happy to have the the bad things in life associated with men. Bogeyman, Garbage man...

BiN4RY · #19 05-29-2018

Quote:

Originally Posted by LEARNINGONLY

Okay do you know anywhere where I can talk about it. Unsure as I need to file in 2018 but never did as a business before.

Speak to a qualified tax accountant in person, not random strangers with self proclaimed titles on the internet.

You make money, you pay taxes. Simple as that. HOW to pay and file those taxes can be clarified by an accountant.

theinventorofgod · #20 06-17-2018

I wouldn't overthink it too much

dallis · #21 06-20-2018

All the advice to 'not worry' because they won't audit 200K or less businesses sucks.

Get a real accountant who knows what's going on to help you.

LEARNINGONLY · #22 06-27-2018

Is there an online only CPA that I can use as my income stream really isn't that high. Is intuit live a good place to speak to one and for help?