(I was wondering, would it be alright, at least when getting started, and not making too much money, would it be okay to take money under the table for Web Design?

If you want to avoid submitting your full income to the tax man you are asking for trouble. It's up to you what you do but if you get caught you could end up with a bigger bill than the money you cheated out of the system!

Good businesses account for every penny and have a good accountant to make sure your tax bill is the minimum possible while still playing by the rules.

Originally Posted by blue-dreamer

If you want to avoid submitting your full income to the tax man you are asking for trouble. It's up to you what you do but if you get caught you could end up with a bigger bill than the money you cheated out of the system!

Good businesses account for every penny and have a good accountant to make sure your tax bill is the minimum possible while still playing by the rules.

I don't think I would have a problem with that, but the next issue....would I need an occupational liscence, to do web design?

I don't mind filing what I make as income, but would it be necessary to have an occupational lisence to do webwork?

i started a thread about this myself, check it...

http://www.webmaster-talk.com/genera...ess-steps.html

As a sole trader, if you aren't making much money you can usually get exemption from paying tax, or pay very little. It will be better off for you to register as a small business and you will find that companies are more willing to do business with you if you can supply them with a valid invoice and business number. Hope this helps!

If you are in the US you can make up to $5,000/yr without having to file a tax return. Been there, done that

You can work 'under the table', but if your client files a 1099 on you for the money they paid you, then the tax man might be asking questions.

Originally Posted by LadynRed

If you are in the US you can make up to $5,000/yr without having to file a tax return. Been there, done that

You can work 'under the table', but if your client files a 1099 on you for the money they paid you, then the tax man might be asking questions.

Really? Can you provide me with a legal reference on this because this would be interesting for my situation. I have a payment coming in, big (larger than $5k), and I was wondering if I could wait until Jan 1st to cash in and then avoid taxes for 2006, please give me more info.

I used to sell Avon on the side. As long as I didn't make more than $5,000 I did not have to declare the income and Avon didn't report it either.

I would suggest you go to the IRS site and read up on the guidelines:
http://www.irs.gov/publications/p17/ch01.html#d0e1373

Originally Posted by LadynRed

I used to sell Avon on the side. As long as I didn't make more than $5,000 I did not have to declare the income and Avon didn't report it either.

I would suggest you go to the IRS site and read up on the guidelines:
http://www.irs.gov/publications/p17/ch01.html#d0e1373

In my case, I worked up until August, then was out of work in August....so can I just file what I made at work, and if I start a "Web Business" now, can I leave that out of it?

I don't mind paying taxes, I just don't want to go through the crap of an occupational liscense.

It seems like a common thing, but I wouldn't recommend it.

Most likely you don't even need an occupational license FanBoy. If you are working out of your house which you probably are, most municipalities do not require any kind of business license for Web Designers unless you have a store front.

If you had a job at some point during the year and have paid taxes, and since you will only be making $5,000 for the year, I would consider filing taxes if I were you.

With this small amount of income form your business, you very well may be able to show a loss this first year. Have you bought any new office equipment? What about mileage? it adds up now. Any new software...Business Lunches..??? Etc,

Just as long as you or your wife (if applicable) have paid some taxes this year, this $5k will not put you over the edge for a penalty for not filing quarterly taxes. You should be fine there...

I would figure it both ways... Look at the Schedule C and see if you can figure out a way to show a loss... May be worth it!!

Let the pro do the work!

i can help you