for those who build pc's for an income

[howste]

I got a license to do it as a "home office" for computer consulting. I also have a federal sales tax ID number so I get the parts with no tax. I just have to pay once a year for all the sales tax I've collected from sales.

[John Prophet]

Well I am kinda stuck right now and Im not sure which way to go.

I would like to get a license and tax ID perhaps, but for one they tell me I cant get a license to sell from home. And I also have the problem that I have a BUNCH of parts now and I dont know what to do if I get a license about claiming them...in other words I bought most of them last year and I dont know the tax laws at all as far as going into business and working capital and all that.

But, if I bought it all retail and already paid tax, should I have to pay tax on the stuff again if I claim it as capital??

Im clueless about these things.

JP

[howste]

You don't have to pay the tax already paid if you bought it retail. When you buy stuff tax free, they send the info to the IRS. If you bought it retail, they shouldn't question it. It's just a good idea to keep records in case you get audited.

As far as the business license, see if you can get one as a home office. Technically you're selling stuff at the customer's home not yours if you do onsite work. The sale location is where the money is exchanged, not where the work is done.

[John Prophet]

Thats the kind of law that we all hate...thats going too far...I know Bill wants every penny, but come on the dude is the richest guy in the world already.

What about the little ol grandma who knows nothing about a computer, buys one at a yard sale, has no clue about pirated this or that...I am supposed to rat her out??

pitiful.


Stings for software piracy?? OMG. Dont they have real criminals in missouri to chase after???

JP

[John Prophet]

I dont understand why you say dont take any software with you??? Why not??

You mean cuz it aint licensed to be used on the other persons comp???

JP

[thronka]

I do jobs like help the senior citizens get going on their pcs when they have trouble. I just charge $5 per problem because they are really cool to be around and it pays for my gas for the week.

[thronka]

Always send or present your clients with a proper itemized bill! Always add local sales tax. In some states, sales tax is payable on labor, others it is not.

What about if you are not licensed by the state to collect sales tax?

[thronka]

I am so into the thread :P

I just have to pay once a year for all the sales tax I've collected from sales.

If possible to open an account and send all the sales taxes collect to a account savings and pay the IRS with that each year? or will that report that to the IRS? If I can, how do I set it up?

[Tazman]

mondobyte -

What's with you folks... you think this is a free ride or something?

Hmmm. I must've missed something in this thread. I believe everyone wants to know how to do it the legal way . I don't recall anyone mentioning installing illegal software or skipping taxes - dunno, I've been kinda busy to read each response in detail .

You did bring up a good point about diagnostic software. If you install it, uninstall it when you leave.

As for working on a PC that has illegal software on it, how the heck do I know??? Unless I gotta format it, I don't ask each PC owner to see their Windows CD and product key. Why would I when I'm upgrading a video card? Nor do I dig through their hard drive to see what is installed. Personally, I don't care. I don't have the time to check and make sure that they have the installation CD for every program and game on the computer and it's registered to them - that's freakin' nuts! When I sell a computer, the only thing installed on it is whatever flavor of Windows they requested (with product key attached to the side of the computer) and any additional software they purchased. When Mircosoft starts to pay me to be their police I'll be more than happy to do the investigations - along with any other software company. If I do have to format and they don't happen to have the Windows CD, I tell them to go to Staples and get it and then call me.

IMO, that law in Missouri qualifies for the Dumb A$$ Award. Granted, a tech should NEVER install any programs onto a computer that it isn't registered to. I don't and never will. IF there are techs doing that, they'll get caught sooner or later. But to set up sting operations to catch it borders on intrapment and seems to go way beyond common sense. I haven't EVER come across illegal software (to my knowledge) installed on a computer that I had to work on in 2 years of doing this. To spend the tax payers money on that kind of legislation and man power for the stings is a waste. 'Specially when you drive through any major city and see crack dealers on every corner. I don't think the techs are the ones who need to get a grip.

There were some good questions brought up about getting legit. In NYS, I only needed to get a DBA and I was good to go for operating. As for sales tax, that was my biggest headache doing taxes the first year. I never charged sales tax because it was always considered labor then got nailed at the end of the year when I filed. The Fedral tax is pretty cut and dry, but the state tax is a pain to figure out. I spent countless hours getting shuffled from on person to another and never got any answers. I don't know about other states but if your in NY and have to go through it, good luck. I would recommend getting an accountant to handle it. That part is the most discouraging part of figureing out how to start a small business.


BTW, I sleep good at night. I do everything by the book. I assume evreyone here also does, that's why I look to y'all for tech advice. I never thought to have to question anyone's integrity or intentions here.

My 2 cents.

ME

[implexant]

Tazman,

i agree. but... i've run into those "well i borrowed that from so-and-so" thing. but no reason to harm the techs for a client's problem.

-Chris