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Wednesday, April 6, 2011

TAXES!!!!

So, it's tax time again. How fast time flies!! In working on our taxes we went from getting a refund of over $900, to owing over $900, to owing about $400. Needless to say, no one wants to pay the government more!!! And with all the stress and financial strain of moving back to California and me being unemployed for almost 4 months, there was no way we could afford to pay this.

Luckily, I remember that there is something that you can fill out if you have a personal business. One of my wonderful Etsy friends, CamillesCloset from the promo frenzy team, told me it was a "schedule C" I needed to do.

So off I went. A lot of the things I didn't really understand about it, and still need to ask my dad about (he's owned lots of businesses). However when I went through and added up all my purchases, and this was just the ones done with a credit card that I had a record for, I had spent over $2000. Yes I know, I am addicted to beads and shiny things!! And my sales were around $800 for the year. So I definitely didn't come close to breaking even. Then I added in my labor. That was a tough one for me, because I had to estimate how many hours I spent "working" or creating. From everything I've read, it seems jewelry designers pay themselves about $20/hour. I did the calculation, entered it in, and viola, we are getting a tax refund!!!

Moral of the story...don't forget your business and don't be ashamed of yourself if you took a loss. This was my first year selling my jewelry, and I was shocked to see how much money I had made. To me, it was a lot, because before it was just a hobby that cost me money. Hopefully this year I will do much better in sales, and in record keeping :)

20 comments:

  1. Very valuable insight, to hopefully use to your advantage next time!!! This is a time of year non of us want :))

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  2. good luck! and great job!!! your jewelry is amazing!

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  3. Congrats...glad you were able to claim your business to get some of your cash back!

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  4. I don't care for tax season either, so we go to an accountant :) The farm is just to complicated for the "normal" human to figure out. Congrats on the refund! Now you can get more beads :)

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  5. E, I can so relate to this. Glad you're now getting a refund.

    I purchase too many supplies for my ideas, too and have a bead and wire supply shop in my home. But, it'll all be used eventually.

    How's California?

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  6. Yuck taxes, I did ours on Monday and it got me so annoyed I almost bit off my poor husband's head just for walking through the room.

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  7. Taxes are a pain but you should take advantage of EVERY credit and deduction you can for owning a small business. It does make a difference. We use H&R Block tax software and it walks you through EVERY little step and is invaluable. I highly recommend it...there are deductions I bet you didn't even know existed!!

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  8. I am still scared of tax time. LOL

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  9. Great news that you got your money back:)

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  10. good that you turned this into an optimistic story! wouldn't it be good if we knew by default all the info that can help us? it would save us all from stories that don't end up as good as yours!

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  11. Congrats on the refund! I did a schedule C as well. It's a life saver!

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  12. that's great. i HATE paying taxes. as if they don't take enough throughout the year for this and that.

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  13. This post get me hope about sales. Not many this last month, so I´m a bit sad but know that before start selling I only spend money and never earn.... maybe less cost this year.
    Thanks for make me think about.

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  14. Congrats, you persevered and overcame!

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  15. Can't get my husband to cooperate with this. Drat.

    Good for you. A refund is better than having to send another check.

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  16. April 15th is NOT my favorite day of the year :(

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  17. Congrats! I know you were so stressed about all this and now you're getting a refund. That is wonderful! And best wishes on your sales this year. :D

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  18. Wow! Thats awesome!! Yay for money :)

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  19. Ugh! I hate taxes, but it's nice that your Etsy business helped you out!

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