If I filed a sales tax return in January do I have to include that in my income taxes?
Posted on August 11, 2009 by admin
Ashley B asked:
I did some cleaning on the side to make some extra money. I made $2400 in 6 months in 2007. I have a sales tax licsense and I filed that already. My question is do I have to bring the sales tax return to my tax preparer and is it going to be reflected in my return?
I did some cleaning on the side to make some extra money. I made $2400 in 6 months in 2007. I have a sales tax licsense and I filed that already. My question is do I have to bring the sales tax return to my tax preparer and is it going to be reflected in my return?
You have to include the income from the cleaning job. You will also be able to deduct legitimate expenses. So take all related paperwork for the cleaning job to your tax preparer.
not sure why you would owe/report sales tax on a service based business…
perhaps you filed a sales tax return showing no taxable activity – ie not taxable labor vs. items for resale?
sales tax revenues should be included in your gross revenues so there would be no deduction – depending on your accounting practices….
to be safe, bring the return with you to your preparer…let them earn their $$$!
That income is taxable but the sales taxes you collected and rendered won’t have any affect on your income tax return. Sales taxes are public trust fund monies. You are acting as agent for the state when you collect them. The money was never yours and is not included in your income, nor do you get an expense deduction from your income for them.
Sales tax has nothing to do with income tax. If the preparer is calculating your business income and expenses from your records, they’ll need to know where the sales tax money went, but that should be obvious from your accounting records – they don’t need to see the sales tax return.