Tax

Have a Tax Question? Ask a Tax Expert

Ask an Expert,
Get an Answer ASAP!

Tax

Hi, I made a big mistake and now need advice. I am a US

Customer Question
Hi, I made a big...
Hi, I made a big mistake and now need advice.

I am a US citizen sending a cargo container of used bicycles from Japan to Ghana. Once I sell them in Ghana, my friend's company that I am selling to is going to wire me back the money.

The problem is since this was my first container I didn't form a company and paid for the container which cost me $8,467 USD out of my own personal checking account. My profit is going to be $1,660 USD. Which means I am going to be wired $10,127 USD all together.

The truth is I'm actually losing money on this container. I had to fly to Japan, fly to Ghana, and pay for the shipment. This is my tester container so I am okay with that but I want this to be represented in my tax form.

If I form a company now, can I use my previous receipts as write offs before the company was formed? I don't want to make this look like I am profiting $10,127 USD when I'm not!

What do I do?
Submitted: 6 years ago.Category: Tax
Show More
Show Less
Ask Your Own Tax Question
Answered in 22 minutes by:
9/3/2011
Tax Professional: Lev, Tax Advisor replied 6 years ago
Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 30,132
Experience: Taxes, Immigration, Labor Relations
Verified

LEV :

Hi and welcome to Just Answer!
I do not see much to worry about. You do not need a company to run the business. As a solo proprietorship - you will report all your income and qualified expenses on the schedule C - www.irs.gov/pub/irs-pdf/f1040sc.pdf.
You will deduct your gross receipt $10,127 in line 1.
The cost of good sold $8,467 will be determined in Part III line 42 - and will be deducted on line 4.
Gross profit on lines 5 and 7 will likely be $1,660.
Then you will claim deduction of other business expenses on lines 8-27 - in particular travel expenses will be reported on line 24. And finally - your net loss will be recorded on line 31 - and will be transferred to your tax return - from 1040 line 12.
I do not see any mistakes from your side. Just be sure to keep all supporting documents.
Let me know if you need any help or clarification.

Customer:

hi

Customer:

I didn't register as a solo proprietorship either

Customer:

hi Lev are you there?

LEV :

There is no requirements to register your business. As long as you will report your business transactions on your tax return and file your tax return before the deadline - you are OK. I do not see any reason for you to worry.

Customer:

when is the dead line?

LEV :

For 2011 tax year - you have to file your tax return by Apr 15, 2012.

Customer:

okay if I feel an LLC now

Customer:

If I pay taxes in Ghana can I deduct them from my US taxes and if so how?

LEV :

You may register the LLC - if you want to separate your personal and business matters. In general - that will not make any difference as taxes are concern. A single member LLC for federal income tax purposes is disregarded entity - means you will report all your business transactions as if you were a solo proprietorship - exactly as I mentioned above on the schedule C attached to your tax return.

Customer:

wait lev

LEV :

If the same income is taxed in the US and abroad - you may claim a credit for foreign tax paid - thus effectively will avoid double taxation.
If also may deduct taxes paid in connection with your business activities on schedule C, line 23.

Customer:

thank you

Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 30,132
Experience: Taxes, Immigration, Labor Relations
Verified
Lev and 87 other Tax Specialists are ready to help you
Ask your own question now
Ask Lev Your Own Question
Lev
Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 30,132
30,132 Satisfied Customers
Experience: Taxes, Immigration, Labor Relations

Lev is online now

A new question is answered every 9 seconds

How JustAnswer works:

  • Ask an ExpertExperts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional AnswerVia email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction GuaranteeRate the answer you receive.

JustAnswer in the News:

Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.

What Customers are Saying:

I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response...

T.G.WMatteson, IL

I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight.

BonnieChesnee, SC

Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation.

JohnMinneapolis, MN

Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with.

OrvilleHesperia, California

Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help.

Mary C.Freshfield, Liverpool, UK

This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!!

AlexLos Angeles, CA

Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult.

GPHesperia, CA

< Previous | Next >

Meet the Experts:

Wallstreet Esq.

Wallstreet Esq.

Tax Attorney

586 satisfied customers

10 years experience

Mark D

Mark D

Enrolled Agent

1,300 satisfied customers

MBA, EA, Specializing in Business and Individual Tax Returns and Issues

Richard

Richard

Tax Attorney

4,310 satisfied customers

29 years of experience as a tax, real estate, and business attorney.

Robin D.

Robin D.

Senior Tax Advisor 4

13,695 satisfied customers

15years with H & R Block. Divisional leader, Instructor

Megan C

Megan C

Certified Public Accountant (CPA)

8,651 satisfied customers

Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level

jgordosea

jgordosea

Enrolled Agent

2,885 satisfied customers

I've prepared all types of taxes since 1987.

R. Klein, EA

R. Klein, EA

Enrolled Agent

1,839 satisfied customers

Over 20 Years experience

< Previous | Next >

Related Tax Questions
If I overpaid new Mexico Gross Receipt taxes for from 2007
If I overpaid new Mexico Gross Receipt taxes for from 2007 to 2012, can I now request for a refund. I know there is a statue of limitation of refile, or refund, but one document says I have only three… read more
Barbara
Barbara
Enrolled Agent, Paralegal
3,458 satisfied customers
A foreign individual is a member of a US LLC. Are there any
A foreign individual is a member of a US LLC. Are there any extra requirements for filing when it comes to the partnership return?… read more
Barbara
Barbara
Enrolled Agent, Paralegal
3,458 satisfied customers
Can my LLC with US and Foreign members be a shareholder in
Can my LLC with US and Foreign members be a shareholder in an S Corporation? The K-1 would go to the LLC.… read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
13,695 satisfied customers
Form 1120, cash basis. If Taxes paid to IRS are deductible,
Form 1120, cash basis. If Taxes paid to IRS are deductible, are refunds for overpayment the equivalent of income?… read more
Chad CFP ®
Chad CFP ®
Certified Financial Planner(R), Pro
Master\u0027s Degree
723 satisfied customers
Our S-corp 3 year average gross receipts will exceed the $10
Our S-corp 3 year average gross receipts will exceed the $10 million thershold in 2017. I know we have to file form 3115 to change our accounting method from cash to accrual but I am unclear if that w… read more
Fred Rook
Fred Rook
Corporate Controller
BSBA
31 satisfied customers
If the LLC owes more than 25% of a foreign corporation, then
Hi,If the LLC owes more than 25% of a foreign corporation, then does the LLC have to report the monetary transactions between both entities (since the foreign corporation is a foreign related party)? … read more
Barbara
Barbara
Enrolled Agent, Paralegal
3,458 satisfied customers
2 Member LLC now 1 Member LLC. What forms to file to IRS? I
2 Member LLC now 1 Member LLC. What forms to file to IRS?I have an LLC that was Me and Member B. Member B has now left the LLC and sold his ownership to me for no consideration. I am now the sole owne… read more
Barbara
Barbara
Enrolled Agent, Paralegal
3,458 satisfied customers
I am a personal injury attorney doing a schedule c as we
I am a personal injury attorney doing a schedule c as we speak. . … read more
Lev
Lev
Tax Advisor
30,132 satisfied customers
If I miss the deadline for my personal taxes, and do not owe
If I miss the deadline for my personal taxes, and do not owe anything...in other words, my income was zero, are there any deductions that I forfeit because I am filing late? I am an IL resident. Thank… read more
abci168
abci168
Principal
27 satisfied customers
I (US person) own 50% in a foreign partnership (real estate
I (US person) own 50% in a foreign partnership (real estate partnership under civil law (GbR) in Germany), the other 50% are held by a none US person. - I have rental income from the foreign partnersh… read more
taxmanrog
taxmanrog
Master\u0027s Degree
698 satisfied customers
Client (US resident) with foreign salary and taxes paid in
Client (US resident) with foreign salary and taxes paid in foreign currency - Part II of 1116 form for some reason adds taxes paid only in US $ (line "o" through "r") - it does not take taxes paid in … read more
Lev
Lev
Tax Advisor
30,132 satisfied customers
I asked for an Federal Income Tax extension to 10/16/17 and
I asked for an Federal Income Tax extension to 10/16/17 and I paid taxes due. This was for 2016. Am I able to extend it further?… read more
Mark Taylor
Mark Taylor
Certified Public Accountant
Masters
2,217 satisfied customers
FEDERAL INCOME TAX: A SINGLE WOMAN RECEIVES A 2016 FORM W-2
FEDERAL INCOME TAX: A SINGLE WOMAN RECEIVES A 2016 FORM W-2 FROM HER EMPLOYER WITH A TYPO IN THE SOCIAL SECURITY NUMBER. TO DATE THE EMPLOYER HAS NOT PROVIDED A "CORRECTED" FORM W-2. IS THERE AN IRS "… read more
Mark Taylor
Mark Taylor
Certified Public Accountant
Masters
2,217 satisfied customers
International attorney that can help with double Taxation
International attorney that can help with double Taxation treaty between US and Germany. A US Green card holder in the year 2014 worked in Germany more than 183 days as a doctor, but less than 330 day… read more
taxmanrog
taxmanrog
Master\u0027s Degree
698 satisfied customers
A taxpayer, Form 1040 Schedule C, is on the cash basis. The
A taxpayer, Form 1040 Schedule C, is on the cash basis. The average revenue for the last 5 years is $5,100,000. There is no inventory. The NAICS is 423600Can he remain on the cash basis?… read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
US FEDERAL INCOME TAX. QUESTION: A SINGLE WOMAN OWNS A
US FEDERAL INCOME TAX. QUESTION: A SINGLE WOMAN OWNS A HOUSE, HER PRINCIPAL RESIDENCE, AND LIVES IN IT FOR 4 YEARS. IN 2017 SHE MARRIES A MAN WHO WILL ALSO USE IT AS HIS PRINCIPAL RESIDENCE BUT NOT HA… read more
Mark Taylor
Mark Taylor
Certified Public Accountant
Masters
2,217 satisfied customers
Is a 1040 US Individual Income Tax Return federal income
Hi Is a 1040 US Individual Income Tax Return federal income taxes owed to the US government? Or is it FICA? I received a letter owing some back taxes and since I'm a priest with a weird set of tax exc… read more
ABC Accounting Group
ABC Accounting Group
Bachelor\u0027s Degree
682 satisfied customers
Can lost profit be used as a deduction for federal income
Can lost profit be used as a deduction for federal income tax? … read more
Rick Martin
Rick Martin
MBA
92 satisfied customers
Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Show MoreShow Less

Ask Your Question

x