Started a Surveying PLLC in NC late last year with a sum of money that was gifted to me.?ÿ I've already done my personal taxes.?ÿ In attempting to do business taxes I realized that the money I received to purchase equipment and software was a gift to me and not the business.?ÿ ?ÿDo I go back and make an amendment to show that amount as a gift to me on my personal taxes??ÿ Also, no substantial work was done last year (literally a $100 or less) because I was starting up and organizing and it was at the end of the year.?ÿ So do I need to file business taxes?
This is all new to me so any advice is welcomed.
For gifts under $15,000 from an individual, $30,000 from a couple there are no taxes, if over the giftee pays the taxes, I've never understood that but I believe that's how it works. You should not need to do anything if the gift is under those amounts, if it was over,,,,,,consult an account. There are ways around paying gift taxes by counting it against a lifetime exclusion. At this late date you need to hurry up and figure it out, you don't want to pin a tax on a giver when a little paperwork can save them from that. ?ÿ
MightyMoe,
Thank you for the quick reply. The gift was under the $15,000 limit. So is there anything that I need to do on my end, like amend my personal filed taxes to show the amount gifted?
And since, business wise, all business that was conducted for the company was software and equipment purchases (besides a $100 consulting fee) do I need to file taxes for the PLLC?
More had it right with one exception. He used the word giftee, which is you. The person(s) who give are responsible for the tax, if any, and unless an arrangement was made for the recipient to pay.
Any business needs an accountant to, at a minimum, set up how accounts will be kept and taxes dealt with. If that turns out to be something you can handle ongoing you might not need them later, but I think most business owners keep an accountant so they can concentrate on making the venture go, instead of having to keep track of all the tax changes.
You want to keep really good records regarding your business expenses.
You want to establish a baseline to account for the worth of your business.
The cost basis.
If you ever sell or have someone buy-in taxes can get out of hand if your basis is $0.
It's simple; if you buy a business for $100,000 then sell it for $150,000, the capitol gains will be $50,000. But if you have no records and the cost basis falls to $0 then the capitol gains will be taxed on the $150,000.
I'm a cheap guy, but one of the bills I don't mind paying is to my accountant.
Yes, Bill is right it's the giftor, the giver who pays, I think they also call it the donor and donee
We are paying grandson's private school tuition. It's under the amount anyway but I found out if we pay the school directly then it's not a gift. Kind of weird. If we give the money to his parents then they pay the tuition then it's a gift.
We've kept copious records on equipment, software, and service expenses up to this point. We will probably get an accountant this year.
I just, this morning, authorized a digital transfer of the biggest pile of money I??ve ever waved goodbye to. Guess who got it...
2018 was a really good year. So good i think I??m gonna need somebody to buy the next round or two, till some more receivables roll in.
Assuming you set it up for tax purposes as a sole proprietor, then you need to use schedule c in your personal taxes.?ÿ But i would wait till next year because your equipment apparently wasn't put into use until this year.?ÿ If you say it was put into use last year then you'll have to depreciate, but if things go well this year you might want to expense it. Not an accountant, just thinking out loud.?ÿ There's federal requirements and then state requirements that can be quite different.
I know this is a little late in the game for a reply but I highly recommend you get an accountant for these kind of things. I only had to pay $200 to have my taxes done and it was money well spent. There are a lot of tricks that they know that can help you lower your taxes.?ÿ
Curious,
This year I am looking at 28% that includes the "Self Employment Tax"...
I'm curious where ya'll find yourselves this time of the year. I meet with my accountant every November and spend the rest of year figuring out which avenues to take to reduce the taxable income.?ÿ
Firestix,
?ÿ
Why not ask your accountant? He probably knows what he's doing...
Note that the thread is 8 months old and only the last few posts are recent.
I did not think that owner contributions were taxed, but I just do what my accountant says.
"Where no oxen are, the manger is clean, But much revenue comes by the strength of the ox."
