Will Selling Pampered Chef Affect My Taxes as a Consultant?

[lizcooks4u]

Amortization...

This one is tricky, I tried to do this one when I consulted a few years ago. This was considered an item that had to amoritized (no clue how to explain that), but essentially it meant you couldn't deduct the total purchase in the buying year, it had to be spread out over a few years. Way over my head, so I skipped it.

A brief or easy way to understand this is:

Total loan cost divided by no. of yrs.

Like a car payment,

YOu put in total cost, Int rate, no of yrs/months to pay it off, etc
monthly payments with all these in the calculator is the amortization schedule.

I used to have a simple computer program, so whenever I wanted to purchase something I could see the monthly payment, the int payments, etc and when it would be paid off.

HTH

liz

 

[hump5]

Which Turbotax to buy???I have been using regular Turbotax in the past, and feel comfortable with it!! Now that I have been selling PC since last January...do I have to buy the more expensive one "Turbotax for business and home" that is $89, or can I continue with the $30-40 one??? What is everyone else using? My husband works for a company that sends a normal w-2, so his info is easy...

 

[klsnyder]

I use the Turbo-tax online.

 

[chesse]

I don't think you can "deduct" things you earnI talked to my accountant and she said you can't deduct things you GET. Deductions are for what you SPEND. You can't deduct income, you can ONLY deduct expenses. Be careful!!

 

[jrstephens]

I talked to my accountant and she said you can't deduct things you GET. Deductions are for what you SPEND. You can't deduct income, you can ONLY deduct expenses. Be careful!!

Are you meaning like products we earn? My accountant says I can deduct them b/c I use them in my business to generate sales. It is called "reinvesting."

 

[chesse]

I don't think you can deduct things you EARN. Deductions are for EXPENSES. Be careful!

 

[jenniferknapp]

but, PC puts them on our tax forms, shown as income I believe... So how can we have to claim it as income, but then use the products for our business, and not be able to turn around and write it off?

 

[pcROX]

You will be able to claim for 2007...not 2006.

 

[jenniferknapp]

You will be able to claim for 2007...not 2006.

For the new products, yes, 2007..but for products earned and delivered in 2006, they would go on that

 

[jrstephens]

but, PC puts them on our tax forms, shown as income I believe... So how can we have to claim it as income, but then use the products for our business, and not be able to turn around and write it off?

My accoutant told me that since we use those products to generate business then we can right their value off. I exlained to him how we earned them and that they are shown on the 1099s too. I think the will be in the bonus section on the 1099, but this is my first year so I am not exactly sure how they show it.

And yes anything in 2006 is for 2006 and the new S/S products would be for 2007 tax year.

I guess it boils down to what you are comfortable doing and how much you trust your accountant.

I have seen a lot of people on her talk about that they deduct their products earned and it being called "reinvesting."

 

[KimberleePowell]

My husband and I started working on our taxes last night. We are using the the Turbo Tax Deluxe. We are wondering where exactly you put groceries for shows and test recipes (supplies?), where you put kit enhancements, where you put the reinvested items that you earned, and where you put conference cost? Any help on this topic would be much appreciated

 

[MicheleC]

I work for a CPA part-time and I have asked him all of these questions about my business.

1. Yes, you can writeoff the products you earned. You were taxed on them as income but you then took those products and put them back into your business. Reinvesting as used above is a good term for it.

2. I just bought a laptop myself this December and he said we CAN write off the whole amount for 2006. Rather than amortize, you claim a 179 exemption which allows you to write it off completely. I'm not sure how to input that into turbo tax though.

 

[janetupnorth]

I believe you have to do the approx. $80.00 Turbo Tax version - the lower one might not cut it...

 

[lisacb77]

I thought I read somewhere on here that the Deluxe has a Schedule C? Can someone help on this? I've always bought that version and was going to install today but don't want to open if it's wrong.

 

[tashayoung]

I thought I read somewhere on here that the Deluxe has a Schedule C? Can someone help on this? I've always bought that version and was going to install today but don't want to open if it's wrong.

I think it does. Anyway, you can go ahead and install it and then if you need to upgrade to a different version you can. I went to Walmart and they only had Turbo Tax Premier so when I got home I updated to the Home & Business version.

 

[lisacb77]

Yeah, I just checked their website and it has it listed as an available form. I guess the more expensive one just has more help??

Good. I didn't want to pay extra if I didn't have to! Thanks.

 

[chefann]

There should be areas on Schedule C for training (Conference), business supplies, etc. DH does our taxes, so I'm not sure of the specific categories they include. If you are still stuck for where to put ingredients for your practice recipes, how about training? You were training yourself to do the job, after all.

 

[lisacb77]

Good thinking Ann! I think I'll keep my PP expense reports and reciepts with my taxes too just in case!

 

[chefann]

Good thinking Ann! I think I'll keep my PP expense reports and reciepts with my taxes too just in case!

That's what we do. I label envelopes with the categories and put the applicable receipts in each one. Then I print the report and hand the whole thing to DH. He files it with a printout and the other documents in the safe.

 

[lisacb77]

Cool thanks. My main concern with TT was making sure the deluxe version I always buy has schedule C. According to their website, it's one of many schedules they have. It looks to me like home & business version just talks you through it a little more. But my dad is a corporate accoutant and DH's stepdad is also tax savvy so I think I'm OK with my cheaper version

 

[chefann]

We only get "Deluxe", not the small business version, and we haven't had a problem with it.

 

[lisacb77]

Whew, Ann you are my hero today! I was all worried I'd have to bother to exchange, and the rebate time is already past, so I would lose out on my $10 back. Thank you thank you thank you!

 

[gilliandanielle]

I bought the $20 version of Tax Cut and it worked fine... we don't have state taxes though so I didn't need the $40 one...

 

[JackieBozeman]

I went on the IRS website--www.irs.gov---and printed out Publications 334, Tax Guide for Small Business; and 463, Travel, Entertainment, Gift and Car Expenses. These should give you all the information you need about filing your Schedule C and SE.

 

[Cookingfool]

What would our Business Code be????

 

[Countrykitchenmichelle]

Maybe I'm thinking too hard, but can we or do we need to write off the $2 insurance.
Because the totals on our 1099 add up to our income after they took the insurance, sort of like pre-tax.

So the $2 they took out we're not claiming as income, so if we wrote it off, it's like we're writing it off twice right????


I'll have more questions tomorrow when my head is clear, I'm going to need info on Tax Cut.
I was able to put in my income, but not the expenses and where do I write off my bonuses. So I need to find where to put my write offs......

my homework for tomorrow

 

[jasonmva]

What would our Business Code be????

I just used the default of 999999 (I think it is 7 digits). I could find anything that related to us. Is it not going to affect anything anyway - the IRS just likes to see what type of small businesses are being started.

 

[jasonmva]

Maybe I'm thinking too hard, but can we or do we need to write off the $2 insurance.
Because the totals on our 1099 add up to our income after they took the insurance, sort of like pre-tax.

So the $2 they took out we're not claiming as income, so if we wrote it off, it's like we're writing it off twice right????


I'll have more questions tomorrow when my head is clear, I'm going to need info on Tax Cut.
I was able to put in my income, but not the expenses and where do I write off my bonuses. So I need to find where to put my write offs......

my homework for tomorrow

The $2 is a deduction.

 

[Countrykitchenmichelle]

What would our Business Code be????

My software has our business code as 454390

 

[DebbieSAChef]

TurbotaxqWe use turbotax each year and we always get a nice return. Now that we have bought a house, we get even more tax breaks and deductions. Plus we have four kids and one on the way!!! I love child credit on taxes!!
I was able to write off about $600 on PC related expenses. This year I will save receipts and do a better job. Although I was impressed with the PP expense report for the year! I love it!

Debbie