If you run a small business, odds are you've got some sort of system for tracking income, expenses, and tax payments. But we're going to bet it's not as simple as the system offered by GoBootStrap. The web service offers a sort of accounting for dummies style interface. To enter income, just click the income tab, describe the client, assignment, and amount, and you're all set.
The expenses tab is slightly more complex, in that you need to select from a list of categories like travel, supplies, or rent. But the category list is relatively short, and there's absolutely no way to add your own clutter with custom categories. While that might seem like a severe limitation, it actually makes sense when you consider what GoBootStrap offers behind tab number 3: Tax estimates.
GoBootStrap examines your income and expenses and lets you know how much you will likely owe on your quarterly estimates taxes. Right now the site only offers estimates for federal taxes, but eventually state taxes will be supported as well.
While Amazon plans to fight New York's recent decision to start collecting, the company has updated its tax collection page to let NY customers know that it willbegin collecting tax on June 1st.
The state of New York recently passed legislation which requires any company with affiliates in the state to collect taxes on any items sold in New York. That covers companies like Amazon which allow individual bloggers and web site operators to add links to Amazon products on their web sites. Amazon doesn't actually have any warehouses or business offices in New York. But thousands of New Yorkers who blog who run part time businesses from their home are considered representatives of the company under the state law, which means Amazon has to collect taxes.
Yesterday, Overstock.com decided that the easiest way to avoid paying taxes was to temporarily suspend its relationships with New York-based affiliates. But Amazon, which has already vowed to fight the new law in court, must be making a fair amount of money from New York based affiliates, because the company will instead collect taxes until the issue is resolved, even if that discourages some New Yorkers from buying products through Amazon.
The state of New York recently adopted a law that requires online retailers to collect taxes for items sold in New York if they have affiliates based in the state. That might sound like a reasonable request if New York shopping malls were littered with Amazon and Overstock.com kiosks. But the affiliates the law refers to are web publishers and bloggers in NY who happen to post links to stores like Amazon and Overstock in exchange for a small commission.
Needless to say, some folks aren't too happy with the ruling, and Amazon has already sued NY. Overstock.com is apparently taking a different approach. The company has begun sending out letters to affiliates in New York, letting them know that the company will, at least temporarily, be ending its relationships with NY affiliates.
In other words, New York doesn't get to collect any taxes from Overstock.com, and the state has probably just ticked off a whole lot of New Yorkers who had affiliate relationships with the company.
You know how if you live in most states in the US you don't have to pay sales tax on items purchased online? Yeah, that's about to change for about 19 million residents of New York State. Legislators have approved a bill that requires large online stores to collect sales tax for anything shipped to New York.
Technically, the tax isn't new. Consumers were supposed to be reporting these purchases on their tax returns all along, but nobody really does. The law just passes the burden from consumers to retailers.
While the bill doesn't become a law until Governor David Paterson signs it, he's expected to do so soon, as the measure is expected to raise $50 million and help balance the state budget.
Companies that collect less than $10,000 per year from sales to New Yorkers will be exempt. But something tells us that means you'll be paying taxes on purchase from large stores like Amazon.
Update: As we've reported in the past, this law wouldn't require all online stores to charge tax, but only online stores that do some form of business in New York State. And that business can include something as simple as operating an affiliate link program that lets New York residents make a few bucks by linking to Amazon products on their web pages. Former governor Eliot Spitzer had proposed the law late last year, but we had thought it was dead -- until yesterday. While it's possible that one outcome of this law could be businesses pulling out of New York altogether, a much more likely outcome would that Amazon and other companies with affiliate programs could refuse to let New York citizens sign up for affiliate accounts.
You know how you you don't have to pay taxes on your internet service? (If you're a US citizen, at least). Yeah, that might last. In fact, it might not even last much longer than a month.
In 1998 the U.S. government passed a law preventing states from taxing internet access. The goal was to encourage the growth of internet service providers. The law is set to expire on November 1st, but the Senate is considering an extension.
There's some debate on the issue. But the good news for consumers is that the debate isn't centered on whether the tax ban should be extended. Instead, Senators are debating whether the ban should be made permanent or just temporarily extended.
The bad news is that if a compromise isn't reached within the next six weeks, the moratorium will be lifted and theoretically states could start issuing taxes. We seriously doubt they'll do that until if there's a good chance a new law will be put in place. But you never know.
As if there wasn't enough to complain about with the IRS, add this to the list. The US Treasury Department is making a charge at forcing Internet auction sites to turn over the identities and social insurance numbers of their users to the IRS so they can keep tabs on income made through these types of sales. Sometimes you read a story and you don't even know where to start directing your anger.
The first, and most obvious problem with these sites handing over the SSN of their users is that they don't have them. And why would they? The strange but loveable guy who runs the flea market parking lot doesn't take the SSN of the people setting up tables. If he did, far fewer people would sign up. Online auction sites are no different. It seems as though Internet auctions may be victims of their own success. It is reported that nearly 700,000 Americans make their primary or secondary income from online sales. This is income that could easily go unreported, prompting the Treasury Department to consider action. But at what cost? Sure, Amazon and EBay and the like will take a hit, but will continue to profit. But many of the lesser known sites may not have the physical or financial stability to stay afloat if they are required to obtain and report the identities of their users.
In the end, the small change in the tax gap certainly can't be worth cyber-ransacking these smaller companies and ruining people's lively-hoods. Unless of course it causes the all-too-fun term "cyber-ransacking" to catch on, in which case these small companies may be deemed as unfortunate but necessary losses.
A Nebraska woman recently found a glitch in the way Turbo Tax lets users file their taxes over the web. By trying to access information she had filed in previous years, she found a way to access data three other users had previously uploaded.
Each of those other users had the same last name as the woman, but different first initials. The information included social security numbers and bank account numbers.
Turbo Tax is looking into the error, and has temporarily removed the link that lead to the exploit.
The exploit only affects users who file their taxes online with Turbo Tax. There shouldn't be any risk in using the software to assist in filing via mail.
Still, it makes you think twice about providing sensitive personal data to any website, even one that you'd expect to have tight security.
Believe it or not, if you're an American, you've been paying a 3% excise tax on all of your long distance calls to finance the Spanish-American war (yup--the same war that ended years before Theodore Veil founded the first long-distance networking firm, AT&T). This week, that tax has been officially repealed, hinting that the old war has finally been paid for, some 108 years later. Or, perhaps more importantly, that your long-distance carrier no longer has the burden of shuffling 3% of their revenue over to Uncle Sam.
Me? I've been a VoIP user for almost four years now, allowing me to circumvent the excise penalty. I'm not sure how much I saved, though. Of course, with VoIP services becoming so popular, the long-term feasibility of this tax was in question anyway. Long distance calling is a dying business, after all. It's only a matter of time before regulators go after VoIP for tax revenue. Oh wait--they already have...
We've seen a couple round-up reviews of tax
software, and while features and ease-of-use matter, a question that shouldn't be neglected is: which will give me
the biggest refund? AP's Ashley Heher pitted H&R Block's TaxCut, Intuit's TurboTax, and 2nd Story's TaxAct against
eachother to find out. She found that while TaxCut and TurboTax had similar results $600 versus $588, TaxAct, somehow,
came up with figure tiny by compare: $175. Of course YMMV with these things, but that $425 discrepancy is enough to
give anyone pause.
A couple weeks back PC World did a round-up review of three of the latest tax preparation software offerings.
This week they're back with revews of
five different web-based tax prep packages: Intuit's TurboTax, CCH's CompleteTax, H&R Block's TaxCut, 2nd
Story's TaxAct, and Petz' TaxBrain. They break down like this, with total costs including both federal and state
returns:
H&R Block is taking a cue from AOL. In major computer magazines this month, H&R Block is
providing free CD-ROMs of its TaxCut tax software to readers. The CDs were spotted in PC Magazine and PC
World. The same program costs $10 on TaxCut's Web site, so it's a pretty good deal. It's the federal version only,
so H&R Block still can make money from you when you buy a state version (if your state has an income tax, that is).
You just peel the plastic coating off and insert the CD into your Windows computers to begin installing it.
As far as the media is concerned, "tax time" is the entire period from January 1 to a couple weeks
after April 15. Just as your tax documents begin to roll in, PC World has posted a review of the three major software tax preparation
offerings: Intuit's TurboTax, H&R Block's TaxCut, and 2nd Story's TaxAct. TurboTax taskes the prize for the
best value for your money, but which one is best for you depends upon your needs. The article also points out that if
your tax return is a simple one, there are many ways to do your taxes online for free if you meet certain
requirements.
As if there wasn't enough to complain about with the IRS, add this to the list. The US Treasury Department is making a charge at forcing Internet auction sites to turn over the identities and social insurance numbers of their users to the IRS so they can keep tabs on income made through these types of sales. Sometimes you read a story and you don't even know where to start directing your anger.
