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Kicktaxing: The Crazy Complexity of Paying Tax Correctly On Crowdfunding
eggboard writes "I thought I knew what I was doing when I budgeted for a Kickstarter campaign. I spent weeks sorting out details, set a number ($48,000) that included expenses, Kickstarter fees, and a margin of error. In the end, we raised over $56,000. But my tax planning nearly put a crimp in cash flow, and could have been real problem. It all worked out, but I've written a detailed guide for people for before and after a campaign to avoid my mistakes."
Who do you think is responsible for setting tax policy and spending tax revenues? Hint- it's not Obama. Did you sleep through 9th grade Social Studies? Or have you not gotten to 9th grade yet?
Isn't it a weird coincidence that the Dow Jones Industrial Average has doubled since "anti-business" Obama took office?
Seeing as Wall Street gave a majority of their contributions to Obama (probably shock number one for you), he made sure to pay them back. That is why he had Bernake print around $3.5 Trillion (not a misprint) and dump it into Wall Street to make sure his donors were taken care of.
Also Solendra owners donated hundreds of thousands to his campaign.
He also invested in Brazil oil with 2 Billion because his buddy Soros was involved.
It goes on and on, but every time Obama has been given a pot of money you can directly and easily trace it going to campaign donors, he doesn't even try and hide it or pretend anymore because those who point it out are called racists now.
So, no it is not weird that the Dow doubled with Obama in charge, its actually expected and some of us have made out like bandits because of it. Enjoy paying taxes for the rest of your life for the money he gave us free and clear.
That is why he had Bernake print around $3.5 Trillion (not a misprint) and dump it into Wall Street to make sure his donors were taken care of.
Oh, and as a small byproduct of that, it kept the US economy functioning.
Isn't it a weird coincidence that the Dow Jones Industrial Average has doubled since "anti-business" Obama took office?
Not really, when you consider literally $4 trillion in new dollars (stimulus and QE 1/2/3) pumped into the economy, mainly via Wall Street. That $4 trillion has to go somewhere, and it ended up in the stock market.
Factor out this extra Governmental spending, and our GDP has barely budged over the last 5 years. The stock market is up because there's a lot more free/easy money to throw/invest, not because the GDP is roaring away.
Browsing at +1 - no ACs, I ignore their posts. So refreshing!
As a small business owner, I can say that the US tax system really needs to be simplified. I started my business 3 years ago, and had to learn the accounting and tax side myself (I couldn't afford a CPA or book keeper at the time). For a nation that claims to be built on small businesses, it sure is crazy trying to figure out what's needed to run start or run one.
WTF - you know, every other small business person thinks of this shit BEFORE they start. It's not hard, really. Quit pretending you're running a lemonade stand in your parents driveway.
Bullshit.
A lot of the folks running Kickstarters have "business plans" that amount to "distribute sweaters to homeless kittens". Should they realize that has tax implications? Well, perhaps, insofar as you can't fart without the IRS taking a sniff. But to blame people who seriously have a business plan of clothing cats, for not understanding cash-vs-accrual accounting? Seriously, go fuck yourself with your framed MBA, dude.
We wonder what has gone "wrong" with this country? TFA gives a pretty damned good example. Have a good idea? Have adequate funding? Ready to ship and create one of those new Small Businesses the talking heads always praise? Oops, FOAD friend! You forgot about your quarterly withholding on money that no sane entity would consider anything but a production expense - Silly bear, considering our government "sane"! What will you think of next?
For anyone seriously wanting to know the "right" answer to this issue - Move to one of America's few remaining unorganized territories (Maine, Florida, and Alaska have a ton of them); that relieves of you 99% of the "bullshit" burden, which rests solely with your most local taxing authority (the city/town/county), and reduces your nightmare to just the state and federal levels. Most states just want a cut of your AGI, so if you have no profit, nothing to report. The feds just want a schedule C and SE, and couldn't care less how else you officially organize your activities.
Now, if you happen to live in a hellhole like NYC where everyone from the city through your Block Captain to your Landlord to your old roommate from 1976 get to fuck you with taxes - Move, or abandon your dream. Seriously.
Thanks, much! Really, I wrote the article in part as a public service, not to be full of myself, because so many people I know have these questions. I have some answers, lots of questions, and lots of places to point people for planning. The commenters here can be awful at times (some are great, thanks!), but they're dwarfed by the number of people who are reading the article.
Freelance tech journalist for the Economist, MIT Technology Review, Macworld, and others
Businesses - those that make stuff - aren't too happy. And they aren't hiring (in case you didn't notice that we've had millions of people drop out of the employment market - due to long-term unemployment). Now, the investors, the financial industry, they don't really care because the Fed's been pumping $85 billion a month into them - and that's made it easy to make money on the stock market. But in general, the business lobbies (outside of the financial and insurance industries - the big winners from the Obama financial moves) aren't happy.
Browsing at +1 - no ACs, I ignore their posts. So refreshing!
I think we could debate the fact that the $3.5 Trillion could have done more for "My economy" had it been spent in public works projects and landed in my pocket.
Bernanke kept "his economy" going -- and that's stocks and record profits. That's 400 families who have more wealth than over 150 million Americans combined.
I'm not some moron who can't understand that we need some bank liquidity to keep paychecks going -- but it would be much better to let a few banks go bankrupt and to redistribute this wealth. It's too depressing to look at the lack of any increase in standard of living since the 70's for the vast majority. And rich people trading paper isn't going to create "demand".
>>"ad space available -- low rates!!!"
I'm fairly certain that if you put that money into the hands of the average citizen, banks would find themselves with a lot of liquidity as people start dumping their debt.
I see the glass as full with a FoS of 2.