Thank you very much for requesting me.
Are you still there
I'm doing some quick "brush up" reading.........seeing if any IRS regs are, or will be changed re: this subject
I'll be back in a few minutes.....please hang with me for just a few
Yes, you may use your husband's income for the Section 179 qualifications
You may use the Section 179 up to $25,000 for tx year 2013
Please see below:
Limits for SUVs or Crossover Vehicles with GVWR above 6,000lbs Certain vehicles (with a gross vehicle weight rating above 6,000 lbs but no more than 14,000 lbs) qualify for expensing up to $25,000 if the vehicle is financed and placed in service prior to December 31 and meet other conditions.
Does anything I purchase, car, computer equipment, have to be in the name of the business and have a license no. I wanted to purchase the car right away but I don't have the business license yet.
Are you filing as a Sole Proprietor?"
No, as an S corp
S Corp rules are a LITTLE different
Let me explain how this would work, and then I have a question for you
You are free to put the truck in your name, but, since this is an S Corp, you have to move the asset from personal to business
okay. Does that involve a transfer of title?
One way to do this is to "lease" to the S Corp the vehicle, but then you have to report as income the lease payment
putting the truck into the S Corp's name would be cleaner for thi
sorry, chat rooms are unforgiving for typing errors
I just want to make sure I get the 25,000 deduction this year.
I actually have a few questions for you, but I see you're typing, so I'
Yes, you can do that
Here's my question............why are you using the Section 179 means that you are depreciating this truck over 5 years, (at which point you would only be able to claim gas, maintenance, repairs, etc) as opposed to mileage that you can claim EVERY year
I need the deduction for this year. We took money out of our ira for expenses and then was socked with a tuition bill for my son because they said that since we used the ira for expenses (even though it was due to bills, medical, my sister's bills, etc, etc) they counted our ira as income. So I am going to start this business to eventually be able to help our income but I need some big deductions now.
This way we will have some of the income offset so maybe we can get money for his tuition. It's killing us and putting him into debt over his head.
please forgive the bold typing....it sort of does that all on its own
but back to your business
No. We are older and are not being penalized for that but we didn't realize the school would count this as income. They don't distinguish I guess but all of it was for emergencies, etc. No mercy.
I think ANY entity (Sole Proprietorship, S Corp, Partnership, C Corp) is great, as long as you understand how it works
are you aware that you will have to pay yourself a salary?
that involves payroll taxes
It's going to be the S Corp because it's the least expensive. Yes I am aware of that.
I'm not trying in any shape way or form to change the entity you chose (S Corp) but Sole Proprietor costs nothing to start
it doesn't have a separate "business" tax return
you simply file a Schedule C along with your personal tax return
I always fear that someone doesn't get all the information they need to make the proper choice for them
If you feel you knew all the options, and chose S Corp, that's great
By the way....I'm sorry I didn't mention this before, but Congrats for opening the new business
Can I deduct the full $25,000 if the business has less than $25,000 income this year. Can the extra be deducted from my husbands income. We file jointly.
Does it matter if I use a regular corporation or an LLC and then file as an S Corp?
the "LLC" is sort of a "catch all phrase" meaning that it is not a tax entity in and of itself as an S Corp would be
They both seem to cost money to start. Is one better than the other?
however, If you file as a reg C Corp, you would have to file
to change the C Corp to an S Corp
Each entity has its own benefits and drawbacks
here's a website that gives you some additional information
My research indicates that I could get protection for my assets either way. So I would want to file my taxes as an S Corp. The fees to the state for the LLC seem to be higher than setting up a corporation. Is there a state tax advantage for the LLC versus an S Corp?
Generally, states recoginize S corps once they're filed with the Feds
A few states do have some adjustments, so you will want to check with your tax preparer
Thank you for your help. you were great.
You're most welcome
Please ask for me again if I can help you in the future