You got it Rev :wink:

Merrick, you're right; if you're already showing a loss for the year then another deduction won't do you any good.

We touched on this when we spoke the other day, but I'm not sure she's treating your taxation correctly if she's talking about "wages" and an LLC. I'm pretty sure the LLC is a pass-through entity which means the IRS makes no differentiation between what the business earns and what you make as owner. I'll get back to you. I wouldn't be in a hurry to file anything though.

 

Well she's gone now. That ended that. Of course I think she was a little offended and told me about her 30 years experience and all that.

Yes no_worries we did discuss this a bit but this stuff takes a bit to sink in sorry ops: ops:

Maybe I'll just try and do my own stuff. I've always done my own taxes but I don't understand depreciation. Probably that's not even that hard as I was depreciating the rental unit I had but I have how I bought this equipment so convoluted it's a bit confusing.

Ok yes I am a pass through entity. A couple of things stand out. You said if I am showing a loss this won't do any good the, the deduction that is, but can't I carry over losses?

Then both you and Rev said that meal allowances and per diem aren't the same thing. I was under the impression that the per diem supplants or covers all meals and travel expenses.

I'm not in a hurry to do my taxes, I was just worried about self-employemnt taxes and also capital gains on the rental I sold last year.

Remember I'm a worrier

 

Business returns are due March 15, at least an S corp is, I would suppose an LLC is too. I don't recommend doing your own taxes, it's just too much to try to keep up with. Search for a good accountant in your area, and according to what I've read on here before, preferably one that understands trucking.

As far as not taking any wages, the first year you can get away with that, after that start taking something even if it's small, it'll keep the IRS from looking at you too hard. I did the same thing my first year and this is what my account told me, actually he didn't like it that I didn't pay myself anything, but I didn't know any better.

 

That deadline's for corps with a fiscal year ending Dec. 31...everyone else is in April. Wages are really a non-issue for pass-through entities since the business doesn't actually pay any taxes.

Merrick, I'll help you if you decide to go it yourself. If you can do your 1040 long form, this won't be too bad :lol: LLC's and partnerships aren't so complicated. But you're going to have to get organized...from our talks that's where most of your work will be :shock: :lol: When you're ready let me know :wink:

 

Thanks no_worries. Actually this was one of the things that had me so aggravated with this accountant. I had everything very well organized. I spent two days at home and every single charge I had classified.

Oh man I hope one day I make it cause at this level in life you get nothing but idiots.


But thanks and I will take you up on the offer, I'll post the stuff here and maybe it will be useful for others too.

Hope you're enjoying the weather out there I'm down in SC now and heading to Jacksonville, FL. Feels nice to be out of the cold 8) .

Thanks again I truly appreciate it.

 

no_worries, I think I was over thinking this ops: . I am known to do that at times.

Last night I realized it doesn't matter how I paid for this stuff. I think I was confusing taxes with financial statements. I don't need to put liabilities etc on the taxes. It doesn't matter about owner's equity etc for taxes. I am not doing a balance sheet.

So basically as the trailer, apu and reefer unit were paid for outright, all I have to do is depreciate them; there will be no other expense.

The truck is one thing I am a bit confused about. I know to depreciate it but I'm not sure how to expense the interest paid. Technically I prepaid the truck for like 2 years or so and then refinanced the difference.

But can I prepay interest like that and then deduct it this year? I know you can only deduct interest paid for the tax year for which you are filing for houses.

Other than that, I have all the expenses already organized. As I told you I have stuff all over the place, but everything is organized in my head and I am maniacal about using the credit card for everything which makes things easier to track and organize (and get the cash back).

Actually I'm glad I am going to do this myself. Cut down on the expenses and I'm tired of dealing with incompetent people. Yesterday was the day I had enough.

I called Delorme and after a year and a half of aggravation with this lame GPS program I walked into Walmart and bought Streets & Trips and didn't lose the signal once! All that time of aggravation and problem solved in 10 minutes and $100.I Let Delorme know what I thought of their program. Of course you think they care they lost a customer, of course not. But it all comes back.

Then I fought with FTD who didn't deliver my flowers like they were supposed to and wouldn't answer the phone til I hit the prompt to buy flowers not check on an order.

Funny things is the kid who answered the phone had the same thing happen to him.


Fought with Discover card too yesterday. These people wear you down sometimes and too many people don't complain but we do have the power of the pocket.

So yeah I will be doing the taxes myself. Thanks for your help no_worries.

 

I'm not sure what you mean by prepaying the truck. It would be unusual to make 2 years worth of both principal and interest payments. Unless you're in a lease, excess payments are usually just applied to the principal. I'm assuming you mean you just sent in a large payment and then refinanced the balance. Whatever the case, your finance company should have sent you a statement stating how much you paid in interest for the year. If not, you'll have to figure it manually :shock:

I know this will sound odd but your interest expense will be whatever you paid in interest this year :lol: Even if, for arguments sake, you had prepaid interest, remember what we talked about the other day, you deduct prepaid expenses in the year they were paid. If you don't have an interest statement, the easiest thing to do is look at the remaining principal on your truck at the beginning of the year (or when you first bought it during the year), and subtract that from the remaining principal at the end of the year. That give you your total principal paid. Take the total truck payments made for the year subtract the principal paid and the remainder is the interest you paid. That's your interest deduction for the truck. Don't forget any interest you accumulated from your creative financing, cc's, etc.

You're right, taxes aren't near as detailed as financials. The benefit of doing your taxes is that you learn how every decision you make affects your tax situation. That gives you an edge when making those decisions down the road. Plus it's one more perspective from which to evaluate your progress.

 

You know something no_worries, I read what you wrote and then I realized that was stupid what I wrote. Of course I prepaid principal not interest sorry ops:

I like this actually cause I guess by this I can figure out if it makes sense to prepay things. I mean I can see how much interest I saved and whether I could have used that money for something else.

Of course I know what I did in this sense made sense but I do have a habit of prepaying everything.

Glad to report 0% interest (except on one card for like 2 month) on all this creative financing. Just a couple of $75 fees. I have a feeling this is all over now though as these deals are becoming harder and harder to get. But it was good while it lasted

One question though, I know as a pass through entity, if there is a profit I have to pay self employment taxes on that don't I? I thought you said I didn't but I did file a schedule C once and I think I had self employment taxes.

Made a mistake in not taking a cheap load out of Jacksonville to a good area and now there is nothing and I have to deadhead out. I'm not sitting here all weekend. I will NEVER come back to this area unless it's well over $2 (all miles was $1.85 for this trip)

I was offered like $.70 on one load, not me.

Thanks again no_worries I really appreciate it.

 

Hey no_worries, I remember now why I said I prepaid interest. Daimler Chrysler doesn't let you just pay principal. I paid the lump sum and they just said I don't have to pay now for a couple of years. Shifty company they are, glad I got out.

 

There's nothing headed near home out of Jacksonville? That's what I'd be looking at, who knows how far you'll have to go for something decent headed somewhere else :cry:

Yes, you do pay self-employment taxes on your profit. I can't imagine I would have said otherwise...we must have had some miscommunication.

You know, one thing where I may have misspoke...I think I mentioned at some point that you don't file a Schedule C for an LLC. I was wrong. You do if it's only a one-person LLC...which I'd never dealt with. That makes this an even easier task for you since everything is done on the 1040, which you're already familiar with.