Demo's do you have a tax id number? Any tax info for me?

[cbecon]

Hi All,

I am thinking about becoming a demo and was talking to my FIL who is also our tax preparer and he kept asking me about getting a tax ID number and how I would set up the "buisness" for my taxes.

1. Have you set up a tax ID number?
2. Do you set up a sole proprietership for your buisness?

This is just so confusing for me and has delayed my decision to become a demo.

[amylou]

I called SU this year to ask about the tax ID #. I was told by SU since this is your business to use your SSN. I did this this year and it worked fine. As far as setting up a sole proprietership, I did not do this. I think if you do that, you have to do your taxes quarterly. Be sure to keep ALL your receipts. Hope this helps.

[wyokat]

HI there,

As far as a tax id#, you only need one IF you have employees--which you won't.

By the nature of the business, you are AUTOMATICALLY a sole proprieter. You don't have to set anything up. This just means you are responsible for your own business--no partnership or corporation.

As far as filing taxes quarterly, it is a good idea IF you have a high volume business. If you are going to be demo demonstrator, you probably won't owe any additional taxes.

As a sole proprietor, you pay your own social security taxes as well as being taxed on your income. (By the way, if your profit is less than $400--no social security tax is paid)

If you end up owing more that $500 in taxes at the end of the year, the IRS will assess a penalty.

HTH

Kathy

[cbecon]

Thanks ladies,

He really scared me off. I barely picked up anything only tax id and sole proprietership when we were talknig. This is not as painful as I thought!

[Shawna]

I do have a tax ID# because I own a store. I don't have any employees but didn't want my SS# as my tax Id. If you call the IRS they can explain why or why not to get an ID #
IN Him,
SHawna :lol:

[Donna Cook]

Local/state sales tax may be an issue, depending on what you do....sales tax is collected and paid by SU but if you do any craft shows and sell stuff other than su product.....you would need one. I sell assorted "stuff" at craft fairs and on ebay and pay sales tax annually on those....in Missouri you can get hobby tax number for a $25 deposit. And it's really easy....I think guys sometimes want us to think stuff is hard...so we won't do it...or will ask them for help...ya gotta love 'em though!

[spammie]

The IRS has a great publication for direct sellers - Publication 911. It tells you everything you need to know about running your business, what's deductible & what forms to file.

You can download it from this page:

http://www.irs.gov/formspubs/lists/0,,id=97819,00