Question

Need help understanding this?

Ok, so my business is run entirely through Craigslist and classifieds sites, and yard sales. I buy items i know are worth more from thrift stores, yard sales, ebay,ect. All my income is cash, and has never touched a bank, nor do i want it to. I also by the items Im selling in cash. so its all cash based.
Im in college so at first i started selling things to get some extra spending cash, but my outcome was allot better then I though I have made almost my states minimum for not paying taxes. Is what I do a business? How do I file cash taxes? I want to keep my cash in a safe at home? Helpppppp.

1 year ago - 1 answers

Best Answer

Chosen by Asker

The legal answer is that you taxes on any "PROFIT" that you make. It doesn't have to be a business for you to owe taxes. In reality you probabaly would owe very little in taxes if you reported every dime that you collected. You had expenses in making that money, like gas, going to the thrift stores, advertising, yard sales signs, oil changes in your car or mileage, etc.
Cash is good, it is hard to trace, however, EBAY, Craigslist, etc has paper trail so you need to watch that. It is my experience that it is usually not the best idea to try to hide everything, just make sure that you take every single deduction that you can, and report the "small" profit that you may have. BTW, mileage and related expenses are deductible even if you didn't buy anything, you were just shopping, or looking for something to make a buck on. That's a pretty wide open door.

1 year ago