DIY Chatroom Home Improvement Forum

DIY Chatroom Home Improvement Forum (http://www.diychatroom.com/)
-   General DIY Discussions (http://www.diychatroom.com/f2/)
-   -   Small business questions (http://www.diychatroom.com/f2/small-business-questions-4295/)

eric s 10-11-2006 02:27 PM

Small business questions
 
I run a very small one man Handyman service. I do not rely on this as my sole income. I work full time as a Plumbing Apprentice and do this all during my own time.

I was told by a relative that an IRS person told her that someone in my circumstances should not or does not have to report that extra income. The income itself started at about 300. extra (gross) per month earnings and has been getting progressively higher...Last month gross was 1300. Do not need to report...True or False?

I will also be checking this out on the IRS site.

The SBA curve...One of the first things they want a guy like me to do is get a tax I.D. This emplies that I should be reporting or I am more attractive for government subsidized loans at which point I am contributing as a tax paying business.

The milage charge... I've seen .445 cents on the IRS site being represented as the standard milage charge. I would use this to pay for my vehicle expenses, maintenance, gas etc for most jobs I travel to. I am contemplating the idea of charging that fee per mi. to and from jobs. Good idea or too heavy handed?

The to and from jobs charge... I will be charging a rate of 15.00 hr while I drive to and from jobs. Why? If I don't let's say I charge 15.00 for work over the space of three hours. What happens when I add the 2 hours I was in the car? 45/5=9.00hr. Think that's a wise choice?

Thank you for your answers in advance.

Hammatime 10-11-2006 03:10 PM

Yes you have to declare the income. Anything over $400.00, I think that's the criteria. Getting a tax id number is a good idea, but you don't have to if you don't want to. You can use your SSN, as long as your a dba. As far as you charging from when you leave until you get back. There is nothing wrong with that, but I know what you mean it doesn't look good on the invoice. The easiest thing to do is set up different hourly rates for different areas. The farther away from your house the more per hour you charge. I bet if you ask your boss that is what he does. Good Luck:thumbsup:

AtlanticWBConst. 10-11-2006 07:48 PM

Quote:

Originally Posted by eric s (Post 20534)
I run a very small one man Handyman service. I do not rely on this as my sole income. I work full time as a Plumbing Apprentice and do this all during my own time.

I was told by a relative that an IRS person told her that someone in my circumstances should not or does not have to report that extra income. The income itself started at about 300. extra (gross) per month earnings and has been getting progressively higher...Last month gross was 1300. Do not need to report...True or False?

I will also be checking this out on the IRS site.

The SBA curve...One of the first things they want a guy like me to do is get a tax I.D. This emplies that I should be reporting or I am more attractive for government subsidized loans at which point I am contributing as a tax paying business.

The milage charge... I've seen .445 cents on the IRS site being represented as the standard milage charge. I would use this to pay for my vehicle expenses, maintenance, gas etc for most jobs I travel to. I am contemplating the idea of charging that fee per mi. to and from jobs. Good idea or too heavy handed?

The to and from jobs charge... I will be charging a rate of 15.00 hr while I drive to and from jobs. Why? If I don't let's say I charge 15.00 for work over the space of three hours. What happens when I add the 2 hours I was in the car? 45/5=9.00hr. Think that's a wise choice?

Thank you for your answers in advance.

If you are as serious as you sound that you are, you really need to talk to an accountant who specializes with people doing self employed work. There are several ways to record and write off car usage, including even the actual purchase of certain size vehicle for work.

We have an 'S' corporation and our accountant's knowledge of our 'choices' (best choice of write-offs, etc.) and all other matters has saved us ALOT over the years.
Also, Years ago, the first year I used him, (when I was self employed) saved me about 15 times what his fee was.
BTW- he doesn't charge us for a call with a question, or his advice.

- just my suggestion -

Tscarborough 10-11-2006 08:53 PM

If you earn a dollar begging on the corner, you are supposed to report it.

slickshift 10-11-2006 10:14 PM

The successful Handyman Business models I know of charge a set fee for the first hour, or any part of an hour, then a (lower) hourly fee or sometimes partial hourly fee, after that

The first hour is usually around $75, which is really what you need to show up at someone's door
Then usually $45 - $55 for every hour after than (sometimes split into halves)

It seems to work well for them
Some even send out a pre-appointment checklist so the H/O can have more than one thing ready for the technician "saves them money by doing it all at one service call" :wink:

slickshift 10-11-2006 10:16 PM

Quote:

Originally Posted by eric s (Post 20534)
I was told by a relative that an IRS person told her that someone in my circumstances should not or does not have to report that extra income.

Has that relative recently been institutionalized?
Mental health concerns? Smoking Meth or anything?
Just plain delusional?


Yeah, the IRS says not to claim income
Hahahahahahahahahahahahahahahahahaha!

eric s 10-11-2006 11:39 PM

I was leaning on the "yes do report side of the fence." Just wanted to whittle away at what little doubt I had. Naturally Prices will be tweaked to switch over to reporting mode.

Accountant specialized in working with self employed...I'm quite a way from having the revenue to allocate to such an investment but, will keep that in mind. "Self Employed." should this term be reserved for those who only work for themselves? I work during the day for an employer.

I do believe that I read somewhere that a businessman should have at least a starting knowledge of accounting practices to run a good operation. This was clearly evident when I had a look at IRS.gov today. Happened across text stating that one of tasks is deciding which month to use as start of annual reporting. Just getting the things in place to report will be a task in and of itself.

Slickshift:
I think this conversation about not reporting did actually occur but, in any event I will be more comfortable when operating as a tax paying business person.

Double A 10-12-2006 01:10 PM

Until you have liability insurance and your licence, don't get tempted to do plumbing as a 'handyman' or you can lose your shirt in the unfortunate event of a problem.

You may also jeopardize your licence. Being censured as an apprentice for plumbing violations has cost more than one of my plumbing apprentice students a year or two of time invested as an apprentice. You don't get credit for OJT when your apprentice status has been suspended and in Arkansas you can't stay in school as an apprentice without your apprentice card.

Not worth the $200 or $500 bucks you might earn.

eric s 10-13-2006 05:30 PM

Double A:

Good to know. I do not have a true need to include Plumbing in my services. That would be best to save for times when I walk around with a Master's Card and the insurance that goes along with it.

I've seen first hand on two occasions just how easy it can be to screw something up and get that call..."The carpet is saturated and it wasn't that way before you guys were here working on our plumbing."

Double A 10-23-2006 12:56 AM

Quote:

Originally Posted by eric s (Post 20740)
Double A:

Good to know. I do not have a true need to include Plumbing in my services. That would be best to save for times when I walk around with a Master's Card and the insurance that goes along with it.

I've seen first hand on two occasions just how easy it can be to screw something up and get that call..."The carpet is saturated and it wasn't that way before you guys were here working on our plumbing."

That would be a nice call to get. NP just call someone that does water remediation and have them dry the carpet and change the pad. The calls that make your butt pucker are the ones that go, "We just came home from a three week vacation to find water flowing out the front door and the entire second floor sitting in the living room."

Can you say, "Total loss"?


All times are GMT -5. The time now is 02:51 PM.