What should I do with this information? It is important that your business books and records reflect your business income, including any amounts that may be reported on Form 1099-K. You must report on your income tax return all income you receive. In most cases, your business income will be in the form of cash, checks, and debit/credit card payments. Business income is generally referred to as gross receipts on income tax returns. Therefore, you should consider the amounts shown on Form 1099-K, along with all other amounts received, when calculating gross receipts for your income tax return.
In addition: -Check your payment card receipt records and merchant statements to confirm that the amount on your Form 1099-K is accurate -Review your records to ensure your gross receipts are accurate and reported correctly on your income tax return -Determine whether you have reported income from all forms of payment received, including cash, checks, and debit, credit, and stored-value card transactions -Maintain documentation to support both the income and deductions you report on your income tax return
If you shared your credit card terminal with another person or business: If you shared your credit card terminal with another person or business, your Form 1099-K will include payment card transactions belonging to the person or business that shared your terminal, in addition to your own payments. Where required, you should file and furnish the appropriate information return (e.g., Form 1099-K or Form 1099-MISC) for each person or business with whom you shared a card terminal. The information return should include the total payment card transaction amount in addition to any other income belonging to the other person or business. You should retain records of payments issued to each person or business sharing your terminal, including but not limited to shared terminal written agreements and cancelled checks.
Can you believe it is almost time to start planning for year end and tax season?
Haynes Business Services wants to help make your tax planning easier! We have attached our 2022 Tax Prep Checklist to help you easily know what will be needed! Of course, every person or business is unique and all items may not apply to your situation. This at a glance list will help remind you of the possibilities!
Also, don't forget, if Haynes does your business' year end financials, please make sure to send over your first ten months from January through October!
We are here to help if you have any questions! Just call us at 706-677-2700!
All receipts from the sale of all goods and service of your company.
Including bartering for property or services. Also, Virtual Currency will need to be included.
Interest and Dividends
Sometimes Cancellation of debt.
Gains or Losses of a sale of an asset
Generally, you are self-employed if you carry on a trade or business as a sole proprietor or an independent contractor, or you are otherwise in business for yourself (including part-time business) What can you deduct: (A business expense must be both ordinary and necessary, in other words any expenses that is necessary to conduct your business or grow your business)
Here is a short list of deductions:
Cost of goods
Cost of product or raw materials, including freight
Direct labor for workers who produce the product (Sub-Contractors)
Business Startup costs
Business assets i.e.: vehicle, machinery, Improvement (just to name a few)
Employee Pay and all related costs
Rent Expense. Space and Machinery etc.…
Taxes: payroll, sales tax, ad valorem on business assets, real estate, state, and local tax
Insurance Premiums used for business purposes. Liability, malpractice, workers’ compensation, insurance employees-Health, Insurance on assets and equipment.
Repair and maintenance on business property
Legal cost, cost to organizing the company, professional services, including accounting.
Research and development
Vehicle expenses either by the mileage rate, or actual expenses, fuel, repairs and maintenance, insurance, parking, or rent on a rental vehicle, used for business purposes.
Regardless how you chose to deduct these expenses a detailed mileage log must be kept., also work with your accountant to determine which method is best foryou. Once the method is chosen for the vehicle it must be use each year on the vehicle.