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tax question

Discussion in 'Business Fundamentals' started by MnM, Oct 30, 2006.

  1. MnM

    MnM Senior Member
    Messages: 289

    I work for a family company and run the irrigation division. I have split wiht my partner from last season and will be doing snow removal on my own and have 2 large accounts. Since I am not a buisness owner my company is letting me go on their insurance and basicly run my own snow removal company through their name. QUESTION? When I get the checks they will be written to JB the company I work for . I know I have to pay sales tax on the money but how do I get that cash out since i am only an "employee"
     
  2. Rcgm

    Rcgm Senior Member
    Messages: 613

    Let me see if I got this right.You split from your partner.The company was called Jb so and so? But the company you use to work for is letting you use there insurance and you want to know if they will make the checks out to JB so and so? First if I am right on all of this I would not use the companies insurance I use to work for. Because if there is hard feelings or it might be all fine and dandy until you cause them to file a claim for 100 grand then they would probally tell you to get lost.You do not want that liability it could screw you for the rest of your life.2nd I would say they could probally make the checks out to whoever you want them made out to.IMO I would not do plowing EVER EVER EVER under someone elses insurance.


    RCGM
    Brad
     
  3. Mick

    Mick PlowSite.com Veteran
    from Maine
    Messages: 5,546

    You cannot be running your own company under another company's insurance. You may work for them and be an employee of that company, but you are the owner of your company and it is seperate from theirs. Don't try to beat the system. "They" have been at it longer than you have. Get your own insurance. Their insurance will not pay a claim filed against your company.
     
  4. Mick

    Mick PlowSite.com Veteran
    from Maine
    Messages: 5,546

    I replied to your other post on this subject. Brad is absolutely correct. You will lose.
     
  5. MnM

    MnM Senior Member
    Messages: 289

    no. I work for JB now. Me and my partner were MnM. JB is letting me use their insurance and all checks will be written to JB . hope this clears things up
     
  6. tjlands

    tjlands Senior Member
    Messages: 577

    Sorry this makes no sense to me.
    First how would you be insured under their name?
    You have to call their insurance company to confirm this, but I will save you the quarter and say you will not be covered.
    Second if they are going to make checks out to JB,how would you get the checks anyway.
    Sounds like a disaster. My suggestion-Start your own company and have them right the checks to you and get your own insurance.
     
  7. MnM

    MnM Senior Member
    Messages: 289

    you obviously never understood my first question... I work for a family buisness called JB. I am doing my own snow removal uder their name. I have already added snow removal on Jbs insurance so I AM COVERED. That isnt even my question. My question is when I get a check it will be written to JB. since the money is really all mine how will I obtain that check. So my question is regarding sales and income tax not INSUANCE. And no I cant start my own company because my insurance cost will be about 5 grand compaired to 1500 through JB.
     
  8. Mick

    Mick PlowSite.com Veteran
    from Maine
    Messages: 5,546


    Sorry, but the only way to get the money is through JB's good graces. It is their's, not yours. You would have no legal right to it. You are trying to beat the system and it could very well bite you in the but t in case of an audit if you claim it.

    The money is not "really all mine". It is JB's.
     
  9. grandview

    grandview PlowSite Fanatic
    Messages: 14,609

    I was reading this over again. Are you saying that JB is owned by mom and and dad and you want to snowplow as a division of that company? I think anyway you look at it the money goes to JB any they would have to pay you.
    Maybe I'm wrong anybody else.
     
  10. tjlands

    tjlands Senior Member
    Messages: 577

    Sorry, I did understand, You just didnt like my answer.
     
    Last edited: Oct 31, 2006
  11. Mick

    Mick PlowSite.com Veteran
    from Maine
    Messages: 5,546

    And you cannot add insurance on somebody else's policy. If you're saying JB is YOUR family, in essence it's still a separate entity from you even if you are a part owner of JB. In this case, the best you can do is have a division of JB of which you are manager (or something similar). The money still goes to JB.

    You are either working for JB (even as a part owner) or yourself. What you're trying to do is like being "a little bit pregnant".
     
  12. Rcgm

    Rcgm Senior Member
    Messages: 613

    :dizzy: HEHEHE LOL I gave up on trying to figure this one out last night.


    Have fun boys :D

    RCGM
    Brad

    Don't try to beat the system it always comes backs and beats harder.
     
  13. MnM

    MnM Senior Member
    Messages: 289




    Bingo. Thanks for someone understanding my mess. My question is how to get the money without paying income tax. I know I have to pay sales tax, but am looking for a way to pull the money out and avoid it. I payed for equipment, I paid for insurance, I obtained my own customers. So you can forget about JBs good graces. They are not out to benefit themselves or screw me, like I said its a family buisness and I am running my own snow removal company under their name , insurance, and in their building
     
  14. MnM

    MnM Senior Member
    Messages: 289

    sorry to keep dragging this on but I want to find an answer
     
  15. Mick

    Mick PlowSite.com Veteran
    from Maine
    Messages: 5,546

    I give up. THE ANSWER YOU WANT IS NOT OUT THERE. Pay your taxes like a big boy or work for them.
     
  16. Bry@n

    Bry@n Senior Member
    Messages: 159

    If the check is written to JB it will need to be claimed by somebody. Likely it needs to be claimed by JB. That is the bottom line. The only way to not do that is to get checks that are written out to cash or get cash itself. That will also only work for small $ amounts.

    I dunno how big your company is etc.. but if your big enough and a bad storm comes by, don't expect 17K in checks made out to cash. Red flags will be flying off the handle.....

    By doing the checks made out to cash deal, you wil also be saving them sales tax. Think about it, you can't pay or collect sales tax on money you didn't technically earn.

    After reading this mess I basicaly aggree with the other guys. If your on the straight and narrow, you'll have no worries when tax time comes. If not, you could get audited, as well as get JB audited. It costs you money during a audit!!!!!!! You will always lose when your audited!!!!!!

    By the way, why ask us? Why not talk to a good accountant that knows the ropes and have him handle it or advise you? Not bashing you, but I woulda done that before openly laying my business out on a PUBLIC forum..........
     
  17. MnM

    MnM Senior Member
    Messages: 289

    I have given up on trying to get the answer out of yall. I am not trying to write checks to cash rather obtain the money LEGALLY but through a loop hole of some sort . Just trying to pick the minds of my piers. Guess not:dizzy: thanks anyway
     
  18. murray83

    murray83 Senior Member
    Messages: 420

    The reason your not getting an answer is that there is NO legal way to do this.

    Hire a lawyer and a damn good accountant if I were you since if you try this you will need them in court,I'm sorry but there is no way you can cheat the government though so called "loop holes that are crap and bogus to begin with,I hope you know the governement can search your records you keep.
     
  19. Rcgm

    Rcgm Senior Member
    Messages: 613

    Ok I will try one more time if the checks are written to jb they will have to pay taxes because that is money they made.So JB would have to hold out money for the taxes plain and simple.If JB would get audited they have to show bank statements showing all there deposits for the year.That is there GROSS your money so the checks for snow removal are in there gross.Then minus all there deductions they get there net.So the only way to get all the money LEGALLY is to have them hold out taxes or tell the customer to make checks payable you. I am sure this was already explained in the same way by another person.

    Also Bryan you don't always lose in a audit just 99.9% of the time:D

    My audit in 2002 only cost be 2800 :realmad:

    RCGM
    Brad
     
  20. Bry@n

    Bry@n Senior Member
    Messages: 159


    You know, you kill me. We gave you solid advise, but yet you seem to think we are dumb and can't answer your question. We have, you just don't like the response. If you don't like the answers you get, maybe you shouldn't ask the question to begin with. That's the problem with shady practices, you think what you want to do is okay. Beat the ins. co and beat the government. Sometimes you have to pay the piper payup