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Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 7225
Experience:  15years with H & R Block. Divisional leader, Instructor
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This year I started doing affiliate marketing online and had

Resolved Question:

This year I started doing affiliate marketing online and had more success than i ever really thought I could. I've hit about $200k in revenue through Oct 1. I was able to save around $100k of my earnings.

Just for reference, this takes place in Ann Arbor MI

But i'm worried that my tax rates will be incredibly high due to the fact that I work from home and as a contractor for another main company.

what are my options at this point? What can I do to get the lowest tax rate?
Submitted: 9 months ago.
Category: Tax
Expert:  Robin D. replied 9 months ago.

Robin D. :

Hello and thanks for trusting me to help you today. I am a tax adviser with over 15 years of experience.

Robin D. :

First congrats on a great first year.

Robin D. :

To lower your taxatipon

Customer:

Thank you I appreciate that

Robin D. :

taxation sorry

Robin D. :

You really need to get all your expenses together

Robin D. :

these will lower the Net and Net is what you will pay tax on for fed and state

Customer:

Even if i'm not an LLC I can still write off my expenses?

Robin D. :

Most certainly

Robin D. :

To be deductible, a business expense must be both ordinary and necessary. An ordinary expense is one that is common and accepted in your trade or business. A necessary expense is one that is helpful and appropriate for your trade or business. An expense does not have to be indispensable to be considered necessary.

Customer:

Hmm okay interesting

Customer:

thank goodness I have email receipts for everything

Robin D. :

As you work from home that is your office too

Robin D. :

there is a deduction for that

Robin D. :

If you use part of your home for business, you may be able to deduct expenses for the business use of your home. These expenses may include mortgage interest, insurance, utilities, repairs, and depreciation. Refer to Home Office Deduction and Publication 587, Business Use of Your Home, for more information.

Customer:

Do you have a ballpark guess as to what percentage I'm looking at paying?

Robin D. :

That is going to depend on how much you can get rid of

Robin D. :

I can give you the chart for tax rates

Robin D. :

but

Robin D. :

until you know what you can subtract you cannot see what rate you are in

Customer:

ah okay

Robin D. :

You also have Self Employment tax

Customer:

yeah :(

Robin D. :

Let me get you the tax rates

Robin D. :

one sec...........

Customer:

i think my best bet will be to hire a local accountant so they can help me manage my write offs

Robin D. :

The first year that is important

Robin D. :

after that you should be able to see how it works

Robin D. :

Your income will be on Schedule C

Robin D. :

[IMAGE][SRC][/SRC][ALT][/ALT][WIDTH]217.22846441947564[/WIDTH][HEIGHT]100[/HEIGHT][STYLE]position: relative;[/STYLE][/IMAGE]

Robin D. :

Sorry that did not come over well

Robin D. :

I am having to use FireFox today and formatting is terrible

Robin D. :

Try this link instead

Robin D. :

http://www.forbes.com/sites/kellyphillipserb/2013/01/15/irs-announces-2013-tax-rates-standard-deduction-amounts-and-more/

Robin D. :

You would look to either married joint or single (unless you claim Head of household)

Robin D. :

Can I help you with any thing else on about your business?

Customer:

Let's just say I didn't write off anything

Customer:

what would my tax rate be?

Robin D. :

Are you single

Customer:

yes i am

Robin D. :

You would be in the 28%

Robin D. :

Michigan State Income Tax rate increased from 3.9% to 4.35%

Robin D. :

You really need to reduce your income by the expenses allowed.

Customer:

28% would hurt

Customer:

well thank you for your help

Robin D. :

Terribly so

Robin D. :

You are most welcome

Robin D. :

Your positive rating is always thanks enough

Robin D. :

Please ask for me again when you come back

Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 7225
Experience: 15years with H & R Block. Divisional leader, Instructor
Robin D. and 5 other Tax Specialists are ready to help you

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