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Thread: Help With Corporate Taxes!!

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    Default Help With Corporate Taxes!!

    Hi, I have questions for those familiar with taxes and corporations.

    I formed a C corp. last January. I totally messed up with this by not keeping good records or receipts and even co-mingled funds a couple of times (I know..big no-no). My question is how can I fix this this? I believe my return is due by March 15th. I have no idea how to fill it out and I can't afford an accountant right now. I'm estimating I made about $20,000 (I barely worked due to illness) and $7,000 or so was spent on expenses. Please advise. I would appreciate your input. Thanks in advance!!!

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    God/dess britneyireland's Avatar
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    Default Re: Help With Corporate Taxes!!

    get an accountant and a book keeper. The person who advised you to established a c corp should have references.

    It's a crime to spend corp money on personal expenses.

    FIND the money to pay someone to represent you.
    Rebecca Avalon







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    Default Re: Help With Corporate Taxes!!

    I didn't say I spent corp funds on personal expenses. I didn't!!

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    God/dess britneyireland's Avatar
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    Default Re: Help With Corporate Taxes!!

    in order to spend any money out of a c-corp, the corp must issue you a paycheck.

    REALLY, get in touch with who established it. why would you volunteer for the double taxation of a c corp (15% corp tax plus whatever the personal income tax rate is for 20k)
    Rebecca Avalon







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    Veteran Member Robertjordan's Avatar
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    Default Re: Help With Corporate Taxes!!

    March 15th is the deadline for corporate taxes but you can apply for a 6-month extension which is automatic.

    Regardless of whether or not you do the taxes and accounting yourself or have a professional help you, you are going to need to create some kind of trail of income and expenses. Depending on how many deposits and transactions you have, that can be simple or time consuming. If you ran most of the business out of one checking account it shouldn't be too hard even if you commingled some funds. Plus it will allow you to reconcile and make sure you aren't missing things.

    You really should have some kind of accounting program like Quickbooks but you can accomplish this with a spreadsheet or even by writing it down on a piece of paper.

    Make a list of all the deposits you made during the year (and the source), dates, amounts, etc. If you had income that wasn't deposited into your account that's OK too, but make sure you include that on the list too. If some of the deposits are not income, make a note of that.

    Make another list of all the expenses and withdrawals you made during the year. Include what they were for and the dates, check numbers etc.

    Now that you have completed the above you could probably submit these to an accountant for a reasonable fee who could compile your income statement, balance sheet and prepare your tax return. If you are feeling really industrious then go ahead and compile it on Quickbooks yourself and find a tax program that will allow you to do a 1120 for federal and depending on your state, a state tax return.

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    Default Re: Help With Corporate Taxes!!

    Thanks Robert!

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    Senior Member tooma's Avatar
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    Default Re: Help With Corporate Taxes!!

    turbotax does have some useful tools for Corp Returns. You can even do them on their site. If you are a quickbooks user, it will use the file from QB to make it go even easier.

    I do agree with Britney though. Someone steered you wrong on the C Corp. You might consider cutting your losses and closing this one after this year and opening an S-Corp. then you won't have the double tax issue.

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    Default Re: Help With Corporate Taxes!!

    Agreed that a C corp usually creates more headaches than positives for dancers. The only way that a C corp really pays off is if you have a corporate vehicle or a corporate apartment or some other MAJOR tax write off, PLUS you want the corporation to 'pay for' your retirement fund, health insurance etc. which a C corp can take right off the corporate bottom line as business expenses. Short of that, an LLC / S corp is a far better choice.

    From what you have posted, you've got a major mess on your hands ... and a return trip to the accountant who set up your C corp is highly recommended.

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    Default Re: Help With Corporate Taxes!!

    C Corp problem -- because this is the first year of business for the C Corp, there is an IRS Revenue Procedure that, if followed properly, will allow you to cure the late S Corp election.

    Comingling of funds -- this, too, can be fixed if done properly. But going forward, must treat like a business to truly reap the best tax benefits, worry-free.

    Not too convinced that visiting your original accountant is in your best financial interest.

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    Veteran Member XxAmber89xX's Avatar
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    Default Re: Help With Corporate Taxes!!

    Quote Originally Posted by TaxWhisperer View Post
    Not too convinced that visiting your original accountant is in your best financial interest.
    Maybe not, but we don't know the whole story. My bet is this happens alot during the first year of running a corporation where people don't always grasp the whole nature and understanding of a corporate instrument and it's procedures.

    btw- love your handle name.
    Oh Canada, we stand on cars and freeze...

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