I want to start doing my own taxes. I have never done them before but feel I want to be more hands on, and saving the money is not a bad idea. However, I have an irrational fear of messing up and getting audited. I have nothing to hide, it just seems like a major headache. I'm sorry if my terminology is off. I have been researching taxes like crazy and am now getting confused and losing confidence that I can do them. So here it is:
My wife started selling LuLaRoe this year. So far we have nearly made more purchases for resale (the clothing) than we have taken in sales. For the sake of this topic, lets say we bought $18,000 in clothing and have net sales of $20,000.
That leaves us with a gross sale of $2,000.
LuLaRoe removes sales tax and processing from our net sales, so lets say from our gross sales they take $500. Now our profit is $1,500.
Now we have our expenses (postage, supplies, clothing racks, ect). For this example I will say $3,000.
So the way I see it, our business is -$1,500.
We did use a credit card to start the business, and we still owe money back on that. I don't feel we have done poorly with our business, as we have taken some of the profit here and there to pay a bill. But most the money has been reinvested in the business. I just feel like we have lived better from the business than the numbers show. And that's where I feel like I have a problem. I feel like if the business has improved our family income, why do our numbers look so bad? Is it a first year business thing? Do I have red flags? I've kept the best records I can using excel spreadsheets.
Thank in advance for help, and apologies for my ignorance.
