Taxes Suck And Make Me Want To Shut Down My Small Business

For those of you who read Untemplater regularly, you know that I’m not the type of person who goes off on big rants. I consider myself to be lighthearted and easy going, and I always try to find a positive in the toughest of situations. But today I am going to vent a little bit. Why? Because I just finished all my personal and corporation taxes and I’m annoyed!!!  Taxes suck.  Period.

I started my own company last year which has been an incredibly eye opening experience. I didn’t have much help along the way because I wanted to keep my costs as low as possible especially in the first year, so I’ve had to figure out a lot on my own and it wasn’t always easy.

Some people have a natural knack for understanding how to incorporate businesses, knowing how to limit tax liability, which forms have to be filled out for which agency when and why, regularly running profit and loss reports and analyzing balance sheets, and all that kind of stuff.  Well guess what?  I had no clue how to do any of that when I started out and it was pretty overwhelming. But at least it’s also really enlightening and I’m still learning new things!

Vent #1 – Double Taxation Makes Me Mad

California is a terrible state to incorporate a business. I knew that going in but it’s where I live right now however, so I bit the bullet and incorporated with the state last year. I could have picked a different state like Delaware, but I didn’t want to worry about California coming after me in an audit for taxes owed since I’m living and doing business in the state.

Believe it when you hear the phrase Sunshine Tax because it’s true. Yes the weather rocks but California taxes the —- out of us and yet it’s still broke!  In fact taxes suck and make me want to shut down my small business just to avoid all this ridiculousness. It’s no wonder so many people try to operate off the record!

Even if you don’t have your own business, did you know that if you get a California tax refund, you have to report that refund amount as income the following tax yeart?! WTF. I do not appreciate that.  (Update: when I wrote this I thought CA was treating refunds as taxable income, but after taking a closer look at my returns it’s actually the other way around – Federal treats them as taxable but it gets subtracted out on the CA return.  I guess that’s not as bad but it’s still annoying though!)

Another thing I found out first hand recently is that California businesses are required to fill out form 571-L every year. It is a form for reporting business property because the state wants to collect taxes on top of the taxes you already had to pay to purchase those items!

Sure there are a few exclusions like inventory, but let’s say you buy a computer for your business, a desk to put that computer on, and a lamp to help you see while you type – guess what? California requires your business to pay taxes on ALL of that “property” even after you’ve paid sales tax to purchase them, which can be as high as a whopping 9.75% in the state.

Vent #2 – Too Many Forms To Fill Out, Too Many Taxes To Pay

When you work for someone else’s company, there is SO much going on behind the scenes that you never even hear about. Processing payroll, submitting payroll taxes, negotiating rates with benefits providers, staying on top of business licenses and fees, EDD notices and forms, corporate taxes, legal fees, disclaimers and policies to write, etc. etc. Being shielded from all of that is actually a total luxury that most people take completely for granted simply because they have no exposure or awareness of what’s actually required to operate a business.

When you run your own business however, you quickly realize that there are a LOT of moving parts to keep track of, all kinds of forms/permits/licenses to fill out, and even more taxes and fees to pay in order to keep your business totally legit and in compliance with all the various rules and regulations of Federal and State.

Paperwork can be a real pain especially when there are mandatory filing fees but I still think taxes suck more.  I really understand now why there are so many businesses that operate on a cash-only basis to avoid paying taxes, and tons of others small businesses get hit with penalties and fines for missing filing deadlines for such and such random license or permit.  I know I’m not a genius, nor am I poorly educated, yet I want to tear my hair out sometimes trying to understand and swallow some of the stuff the government requires.

Before You Vote For Bigger Government And Higher Taxes, Try Becoming An Entrepreneur

If I’ve learned one thing over the last year as a part time entrepreneur, it’s worth it to pay for professional help and not expect to be able to figure out everything on your own overnight. I wasted countless hours of my own time going in circles trying to understand certain aspects of incorporation, taxes, and accounting that could have been answered in just a few minutes by someone with the expertise.

If you have the funds, it’s a big help to have a good accountant. To me it was the best money I’ve spent for professional help so far because taxes are down right complicated, the rules are ALWAYS changing, and having an expert to answer questions specific to your business situation will save you a lot of time and headaches.  They also understand how much taxes suck and can help you maximize your deductions and take advantage of any credits you are eligible for.

I must say I have a much different perspective of tax policy after starting my own business. Once you see firsthand how much corporations get taxed, actually go through the pains of filling out and filing all sorts of government paperwork and forms, and have to write checks for way too many fees and taxes, you start to understand how hard it is to make money as a small business owner and how easy it is to get hit with penalties for missing a payment or a filing deadline.

Small businesses make up roughly 80% of new jobs and we need them to be able to afford to keep hiring! If I had a chance to change things, I’d try to simplify the whole darn process for small business owners. There would be fewer agencies to report to, no double taxation, and no more stupid California $800 minimum franchise tax!

Untemplaters, do you think taxes suck?  What do you want to vent about as a tax payer and business owner? For any entrepreneurs out there, how much operationally did you do on your own the first year? And if you haven’t started a business yet, what are your biggest hurdles and hesitations?

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Hi there, I’m Sydney! After ten crazy years, I left a grueling six-figure job in 2015 for a better life. Now I spend my days writing, freelancing in various capacities, and finding new ways to stretch my brain. I’m crazy about photography, traveling the world, and stopping to smell the roses. Untemplater is where I share my insights and adventures with the world. I hope to never stop learning and being able to give back - every day is a gift! My love of helping people improve their lifestyles, careers, wealth and happiness constantly motivate me to write and evolve. Thanks for reading and I hope to hear from you in the comments below!

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  1. says

    It is truly a wonder that anyone even bothers to start a business when you describe it this way. I have a few small LLCs, but most of the tax stuff just flows through to my personal return.

    • Sydney says

      Yeah it’s a real bummer taxes have to be this complicated especially in California. I was so happy to move here but now it’s quite tempting to leave!

      • says

        I live in New York and it’s right up there with California in taxes and governmental dysfunction. I can’t imagine why anyone bothers to start a business in this climate…

        • Sydney says

          I’ve heard horror stories about NY too. I’ve never had my own company there, but I used to work for someone else in NYC a long time ago and I remember having to pay city taxes on top of state which was tough. NYC is expensive enough as it is!

  2. Miguel Marcos says

    I don’t think the issue is bigger government and more taxes. I think it’s corruption and lobbying. If politicians weren’t beholden to large financial contributors, perhaps things would be different.

  3. says

    It’s no secret that taxes are a huge failure (as is the case with most legal things). We’re taxed three or four times over: when you buy something, it’s with money that you’ve already paid income tax on, yet you’re paying vat, import levies and whatnot on top of that. And in addition to all this, states and countries still don’t have enough money to provide social welfare. Huh!?

    Higher taxes are required, but not on the average employee or small-to-medium business. No no no. What is required is that the big guns seal off the “leakage” through tax havens. Why is it that the richest companies pay the least tax? Politricks.

    (Sorry for the rant. This is a topic that irritates me too. Having studied (British) tax in pursuing my accounting qualification, I had a hard time digesting the unfairness of the tax system.)

    • Sydney says

      Yes the double and triple taxation gets me so mad. Sure any government needs taxes to operate but taxing us multiple times over leaves us with nothing to spend to support businesses and the economy. Politricks is right!!!

      • says

        If the government was properly managing the money they took in they wouldn’t need to double and triple tax us in the first place. I’m so frustrated with Washington –both parties — because I feel it is so corrupt. It irritates me so much when I hear one of those bozos even mention the idea of taxing anyone more. In my opinion, manage what you have and if you’re not wasting what you have and need more, we can talk. Until then, shut up about raising my taxes. LOL

        • Sydney says

          EXACTLY! Both parties are corrupt and it’s so obvious how inefficient and dysfunctional the government is. Raising taxes isn’t going to fix the underlying problems.

          • says

            Your right it IS SOOO obvious but apparently not to everyone unfortunately. LOL

            Even with a tax system does the code really need to be so extremely complex and harsh on business owners. The average person shouldn’t have to hire someone to deal with it.

            Imagine if it was “so easy a caveman could do it”. Which it should be.

            One could then use the money they would have spent on an accountant to grow their company eventually stimulating this lame economy giving the government one less reason to make itself even BIGGER. LOL

    • says

      So, higher taxes are okay as long as *someone else* pays them? Put your money where your mouth is…support the flat tax or another consumption type tax (not VAT)

      Don’t forget that most of those rich companies are paying state taxes, employment taxes, and, best of all, the shareholders are paying taxes on their dividends.

      • SlyRobber says

        Really? Then their richly paid accountants aren’t doing their jobs because in my family I have people who live in those tax havens, they have lived in Bermuda, Luxemberg, Caimen Island and other places, and are very well paid to hide the money of their billionaire customers from their respective governements. So me thinks THAT’S the cruft win problem with the burden on small and medium businesses that and the general incompetence of the business operator. Sorry.

  4. says

    The $800/year Franchise Board Tax in California is such a joke. Double, triple taxation is a joke.

    Once people start their own small businesses, I SWEAR they will never ever vote to increase taxes or introduce more taxes again. 6-7 envelopes to the government to pay your taxes Sydney? That’s freaking ridiculous!

    New law if I am President: All people who support tax increases and more taxes most go through a 6 month program and start their own business and pay all the specific taxes!



    • Sydney says

      I second that vote. Yes I’m taking my six envelopes to the post office today. Some of them are 2012 estimated taxes that I’m getting out of the way early so I won’t have to think about the next installments for a few more months. I usually am not one to get angry but taxes sure make my blood boil. Augh oh how I hate the $800 minimum franchise tax!!!

        • Sydney says

          Well that’s why I got certified mail return receipt as it proves I put them in the mail in time. If the checks bounce that’s a different story though! I gotta make sure I don’t goof that up or I will start screaming and could have a stroke.

  5. Rachel says

    CA is the most ridic state ever when it comes to taxes. Thank god I moved out. My bff owns her own accounting firm in so Cal. If you’re in that part of state and need an accountant let me know. She works exclusively with small businesses.

    On a side note, Sam you should take over the government.

    • Sydney says

      I think I’m gonna move out of the state too! It might take me a few years but I don’t see myself living here long term anymore. It’s ridiculous!! Thanks for the offer on an accoutant. I found a great one near where I live. He’s not cheap but he is really experienced in small business and does good work.

      • Rachel says

        I don’t blame you for wanting to leave. I moved to the midwest. Cost of living is way cheaper and wages are actually higher, which surprised me. The weather and lack of a beach is a whole other situation. Best of luck.

        • Sydney says

          That IS surprising the wages are higher there, which is awesome for you! Yeah I was actually at the beach talking a walk today just thinking how happy I am to be near the water and not being land locked. I think I’d try to live near a lake or at least river if I moved inland and had to give up being near the beach! :)

  6. Jeff @ Sustainable Life Blog says

    Taxes do suck, but I also incorporated a business this year and dont have to pay basically anything you listed. I filled out a 4 page form, paid $100 to file with the secretary of state, opened a bank account and I was good to go!
    As for taxes, all of my companies taxes are passed on to me, and are taxed at the state personal income tax rate of 0.

    • Sydney says

      Ok I am majorly jealous now. I seriously need to get out of California in the next few years. Man zero state income tax sounds too good to be true after what I’ve gone through. Oh how much simpler life would be. Glad at least one person I know gets to enjoy those benefits!

  7. says

    Sydney, get out of my head!

    Both my wife and I have separate side businesses, and the amount of time we work to do the tax returns is ridiculous for what we’re trying to do. Add it up with California taxing things the Feds don’t (like HSAs), and doing zany things with capital gains and you’ve got a silly tax plan which tries to balance a massive budget on a few (and decreasing number of) people.

    Hence, California does very well in the boom times, and horribly in the busts… Unless something changes tax-wise this will continue!

    • Sydney says

      I feel a little better knowing you understand and share my pain but it’s so sad I’m even saying that isn’t it?! Oh boy I don’t even want to know what HSAs are and how California taxes them. I just hope I don’t get any more surprises in the mail about such and such ridiculous form from the FTB or Phil Ting’s office. I’ve had enough headaches to last me for the next several years!

  8. says

    I started a printing company last year and my taxes were a complete headache! Add to that the hoops you have to jump through to just start a business and I’m surprised anyone would want to start one. I’m just glad I don’t have employees because that adds more suckage immediately!

    • Sydney says

      Oh man my thoughts completely. I am avoiding even thinking about hiring an employee for those very reasons. At least hiring independent contractors isn’t too painful but California still requires all of them to be reported to the EDD when they hit a certain amount (I forget but I think it’s $600) but that’s of course totally separate from the 1099-MISC process.

      • Marty says

        I wouldn’t do any 1099’s to nobody that lives in the same state as Me/You. I’m from NC here’s what it is like here. We have a small company that produces in service’s about 10k a week with a 66% profit margin. We are offering to pay 5 employees 10% of that which is about $25hr each. At 3.2% the pay is above fed min wage at $8hr. We only have a 66% profit margin to start with anyhow but nobody wants to work! Last employee we had here decided to steal our customers credit card numbers and purchase stuff for himself off websites. He gets caught red handed and ends up getting unemployment pay and not charged by the cops for anything! That stunt 6 months ago has costed us almost $100k in losses with probaly another $100k for the rest of this year.

        • says

          Wow what a nightmare. I can’t imagine how frustrating and painful that experience must have been. Can you clarify if the man who stole all of that was an employee of your company and not an independent contractor – that’s how he was eligible for unemployment or no? Wouldn’t that make you want to only hire contractors and not employees in the future? (1099’s are for contractors)

  9. Jerret says

    That’s why I think employees should have to pay their taxes quarterly just like business owners. People would be up in arms if they had to write a check every quarter. I used to send an invoice with the hours it cost me to fill out all the paperwork. They never paid so I stopped sending them :-)

    • Sydney says

      Oh I agree and there’d probably be tons of protests and even more taxes we’d have to pay in order to cover the postage and processing of the government having to send out millions of late notices. I was totally confused about what quarterly taxes were last year until I got slapped with a stack of UGLY payment coupons for 2012 last week.

      • says

        Milton Friedman (who helped create the tax withholding system during WWII days) said, “I have no apologies for it, but I really wish we hadn’t found it necessary and I wish there were some way of abolishing withholding now.”

        It was meant as a way to fund war spending without causing inflation to spiral out of control… and now we’re stuck with it, heh.

    • Sydney says

      Yeah it’s crazy. California has a lot of problems. You can’t even get a drivers license renewed and issued on the same day at the DMV (well at least not in SF). You get stuck with a piece of paper for weeks.

  10. Web Development Company says

    After my 4th year in business, I was finally able to hire an accountant to do my taxes. It was something I dreaded every year and would wait till the last minute to file. Hooray for progress!

    • Sydney says

      Progress does feel so good doesn’t it? Nice job getting an accountant. It really does take the pressure off from having to figure out all those crazy forms!

  11. says

    Tax is a horrible thing to deal with and wading through all of those forms is a nightmare, so I outsource the work as much as possible. Hope you make a stack in the year to come so it is all worth while!

    • Sydney says

      Thanks Shaun! Yeah even though I hate the whole tax process I’m trying to learn as much as I can at the same time. I’m still leaving all the filing and forms to my accountant but I asked lots of specific questions about my returns, took notes, and am going to pay a LOT more attention to expenses and deductions this year!

  12. says

    Fortunately, I don’t live in Cali so my taxes wouldn’t be nearly as bad as yours. However, all of the paperwork that is required has stopped me from starting a business. A few years ago I was looking into starting a portrait business. But since I might have been doing business in the small town that I lived outside of they required a license (basically fill out the form and pay for it), even though I knew I wouldn’t actually be doing business there. After that I quit looking into it, because I knew it would only get worse.

    • Sydney says

      Yeah it really can get so discouraging trying to figure out all the documents each state and county requires. A portrait business sounds very cool though if you do decide to give it a go. I’m a big photo hobbyist myself. What I did learn in the last year is that actually going in to city hall and speaking with the staff in the various departments was really helpful over trying to figure out everything on my own online.

  13. says

    I love when people start their own business route, and then realize the work involved to stay “legal”. This is especially true for states like California, or where I live New York. The legal red tape and amount of taxes paid is such a joke! You try to make an honest living and it’s becoming harder and harder to stay legit within the legal mandates and taxes. In New York I’m paying quarterly a commuter’s tax, towards the MTA. The issue is I don’t commute via any mass transit!

    • Sydney says

      Oh man I hope California doesn’t get wind of that and spring something like that on us here. Although I wouldn’t be surprised if they already have a tax like that and I just don’t realize that I’m paying it. Even though I’m a commuter and can appreciate a good public transit system, that’s a bummer that NY makes non commuters like yourself pay taxes for the MTA!

  14. says

    I recently heard a great way to describe taxes and government: Even if you’re a freelance professional, you have a 50% partner with at least 50% equity in your business. A partner who doesn’t do anything to help, is entirely selfish, and may even decide to increase his share in the business — and you don’t get a say in that. What a deal!

    • Sydney says

      So true. I heard someone say recently about how sad and annoying it is when you’re paying more in taxes than you can save for yourself in a year. Talk about depressing!

  15. says

    Want to know why taxes are so high? Read this thread:
    Want to lower your taxes? Vote out all the incumbents, stop asking for *free* stuff (see above), and demand a balanced budget amendment.

    • Sydney says

      I hear ya. Incumbents always try to get a lot done in their first term and are so focused on keeping their approval ratings up so they can get reelected, but once they get to their second term their motivation to help the country just isn’t the same anymore.

  16. Melissa@PersonalFinanceJourney says

    I am not enjoying paying taxes as a freelancer, but having to pay taxes on your tax refund? Seriously. That is terrible.

    • Sydney says

      Tell me about it. What a burn!! And it’s not something that can be avoided either because the state already knows exactly how much the refund amount was so there’s no way to leave it out of your filing the next year without getting audited!

      • Sydney says

        FYI I added an update on the taxable refund note in this post as I had originally thought it was California that was double taxing me on my refund but after I took a second look at my tax returns it’s actually the Fed that did! My prior year CA refund had to get added to my total taxable income at the Federal level, but it was subtracted out on the state return. Still totally sucks as it is double taxation by the Fed but at least California isn’t treating the refund as taxable the following year. But in a way they are because they force us to report the refund amounts to the Fed!

        • Julie D. says

          The way to avoid having to report your state refund on your federal return is to claim the general sales tax option on your federal Schedule A instead of reporting the state taxes that were taken out of your income. I’ve been doing this for years now. The amount of the deduction using the general sales tax method has always been higher than the state tax that was taken out of my husband’s paycheck. To quote from the instructions for the 2011 Form 1040: “Line 10 Taxable Refunds, Credits, or Offsets of State and Local Income Taxes. TIP: None of your refund is taxable if, in the year you paid the tax, you either (a) did not itemize deductions, or (b) elected to deduct state and local general sales taxes instead of state and local income taxes.” So if this tax year, on your Federal Schedule A, you claim the general sales tax instead of claiming the actual state taxes you paid, next year you will not have to report your refund as income. Of course you will have to figure out which method will help you to hold onto more of your hard earned money. It worked for our situation. We have a friend who’s started her own coffee shop & her major complaint is the 1,000s of dollars she’s been charged in taxes & fees and they haven’t even been opened a year yet. Yup, California is not a very business friendly place.

  17. says

    I agree; taxes suck! I’d much rather keep my money than expect a large tax refund at the end of the year only to have to pay taxes on that amount. I need to move to a state with few taxes!

  18. Tyler S. says

    Hopefully Florida is a little more kind.. although their prices for license / car registration are a bit high! I wonder how many people dreaming of Cali will think twice after seeing this haha!

    • Sydney says

      I know! It’s a great place for lifestyle but not for running a business. It will be really interesting to see how the population and number of businesses change in California over the next 5-10 years. I can easily see myself gone by then!

    • Sydney says

      It really doesn’t! $800 minimum is crazy. It’s serious money that small businesses, especially newer ones can’t afford to shell out every year.

  19. zoenirvana says

    at first i thought starting my own business would be fun, at first it was until i got my license, then it was a fee for this and a tax for this, and this was before i even started..then i have to file every month for this and pay taxes on things that shouldn’t be taxed,then the multi forms i have to do that pop out of no where and this and that ..then the use tax, the occupational tax,the excise tax , the use tax, the resale tax, and this and that, and i completely hate it. i had to pay taxes on no profits, im so ready to just call in and say please cancel my business because i am paying the government more than i am making… which means im making nothing. i hate this completely, and ready to file a lost

    • Sydney says

      It’s so ridiculous isn’t it? It’s so messed up that all these fees and taxes put so many businesses, especially new ones, in positions where they are paying out more than they are bringing in. I hope that some of the initiatives with #FixYoungAmerica will change that.

  20. Richard Chance says

    “Before You Vote For Bigger Government And Higher Taxes, Try Becoming An Entrepreneur”

    Or even just having a little sympathy for them.

    • Sydney says

      That’s cool you’ve run hotels Shilpan. That must be a lot of work and coordination dealing with so many employees and guests constantly arriving and departing. And man a lot of payroll taxes and property taxes! Interesting ideas on your fair tax plan.

  21. says


    I totally agree with you. The only solution is to embrace entrepreneurial government. Our world needs more city-states and city-state like entities. We need more diversity of government. We need more choice. Don’t expect major change coming from a top-down approach.

    • says

      What you describe is the republican form of government set forth by the constitution. Unfortunately, progressives (in both parties) have been dismantling it for the last 100 years in their bid to focus their power and deny liberty.

  22. says

    P.S. Taxes aren’t that great in Canada, either, but I think we have a lot less red tape than you Americans. I never heard of this “W8BEN” crap until I dealt with businesses south of the border. Canada is the new land of the free. We have a freer market than you guys. If you can stand the cold, come up and run your business up here. The west coast is doing especially well, from what I hear.

  23. says

    P.P.S I do have a dream of going to California some day, as it’s the center for mobile and Internet technology and innovation, but, and this is a very big but… I really don’t like the direction of the Federal government, and it seems you guys have an unbelievable amount of red tape there. The sun & weather are attractive, and California seems like such a nice place to live, but I have a really bad taste in my mouth when I think about all the hassles I’ll actually have to go through, especially seeing as how I’m a foreigner from the point of view of the U.S.

    • says

      With your mobile ap development skills, moving to the San Fran Bay Area could very well be the BEST move of your entire life Kevin!

      Also, we don’t view Canadians as foreigners. Really, we don’t!

          • says

            I’ll throw in a plug for Alameda. Close to everything, self-contained with entertainment, shopping and restaurants, *and* the MythBusters at the north end doing cool stuff on the runways.

          • Sydney says

            haha All of the Bay Area is pretty awesome but SF is a blast. I know you wish you had Muni and all the crazy passengers to entertain you on commutes. :)

    • Sydney says

      Yeah, the California lifestyle is awesome for weather, food, culture, the outdoors, but just icky for government and taxes. Right now I like city living and it helps a lot career-wise, but I think I will happily move out of state later on to some suburban area with a better tax system and more support for small businesses.

      I haven’t had a chance to explore much of Canada yet but I hope to. I’ve been to Toronto which I liked and I’ve heard Vancouver is nice too.

  24. says

    Vote with your feet! If you want to keep the business, move to a place with a friendlier business environment. Do your research, talk to people with businesses in different states. There are better places to own a business.

    • Sydney says

      Yeah. I’m not ready to move now but I know when I am I’m going to do a lot of research on tax laws and government requirements for businesses beforehand so I’ll know what I’m getting into!

  25. FedUp says

    We just got our 571 from Alameda County and I went bananas. Just like you, we are a very small business that so far have been paying every taxing agency you can imagine except paying ourselves. My Wife is ready to call it quites.
    Since we a small winery ( in two counties, one office, one production) In addition to Fed, State, Local fees, Counties we have Ag Commission, Alcohol, Tobacco and Fire Arms Excise Tax (AKA TTB), every state we sell wine to and countless other little leeches that want a piece of the action.
    This craziness has to stop!
    I was a die hard independent/democrat until I started my own business.
    Sometimes it seems all these rules and taxes are made up to the bureaucrats can stay in business. I say vote all of them out of office.
    There, feeling better now. Thanks.

    • Sydney says

      Oh man what a burn! California taxes us on everything, it suuucks. San Francisco is even collecting 10 cents for every plastic bag we use. It’s nice they are trying to be environmentally minded, but it still annoys me that they are collecting money for it because it feel like more taxes.

  26. frankie says

    Corruption is correct, that is why many people choose to do business or open or invest in overseas. But as some of you know, a few years back the government had been cracking down on oversea income tax. My friend has an oversea property that he had invested in and had been collecting rent from and due to the cracking down, he was advised to report it and it was the biggest mistake! He should have given up his citizenship instead. What the tax people don’t tell you is that once you report you have property overseas, the tax people will grab onto you and take everything, on top of the obscene amount of penalty. Their formula is tricky. They don’t use the rent you get for the past 10+ years, they use what the fair market value that they get (purposely high). In the end, he lost everything!

    • says

      Oh wow what a conundrum your friend got into. That’s SO sad he lost everything. I’d think it’d make sense to pay some taxes to the country overseas where the property is located not back to the US. But the US wants it’s fingers in every pot you have all over the world if you’re a US citizen.

      I was reminded recently of how messed up the tax rules are in California when reviewing their business registration renewal form – if you own a business,”any tangible property owned, claimed, used, possessed, managed or controlled in the conduct of a trade or business” is subject to business personal property tax. So the computers, furniture, and office supplies that you already paid sales tax on to purchase get retaxed by the state. The starting amount that’s taxable is $100,000 which a lot of small business owners can reach quickly, especially places like restaurants that have a lot of furniture and kitchen equipment.

  27. says

    I have to agree with you on this one. I firmly believe there needs to be a better definition of a small business when it comes to the tax code to help the smaller businesses succeed and grow. Then when we’re making the big bucks, go ahead and tax us–when we can afford it. Basically I think that the larger corporations out there have too much money on their hands. I call the point of having “too much money” as the point where you can hire lobbyists to get corporate tax benefits. When I can afford to do that, feel free to tax the hell out of me.

    • says

      Yeah I agree. There are local ordinances here that only apply to companies that have 50 or more employees etc. There should be more tax credits for companies that are just starting out. The tax code is already insanely complicated, so might as well add a few more modifications to help small business owners. We need to keep our economy and mom and pop shops growing.

  28. says

    I just started working from home, so I have been stashing away my money for tax time. I can’t wait to see what I owe-can you read the sarcasm…

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