Schedule C Sole Propietors

One of our primary focuses at CS CPA Group are Sole Proprietors.  Someone who has met a need or followed a dream into entrepreneurialism.  We love these brave souls that have stepped our on their own, and we are ready to be an advisor and guide to help them achieve their vision.  While there are hundreds questions that we can help answer, here are some of the concepts that the Sole Proprietor needs to understand in depth:

Self Employment Tax

There is one issue we hate to talk about – after the fact!  We have had too many conversations with sole proprietors when they are review their first 1040 tax return with a schedule C business and they find out about self-employment tax (Social Security and Medicare).  Every dollar earned as profit (up to the S.S. limit) from a Schedule C business is subject to 15.3% self-employment tax and this is before you calculate income tax!  We have some tried and audited methods to ensure you pay the legal minimum!

Business Expense Optimization

The first and most important analysis we complete is to ensure you are properly recording all legitimate business expenses.  Very often, we find business owners that paid for supplies or services out of their own pocket, when that expense is related to the business and would result in significant deductions. We take the time to ask about your business processes and how you keep your books.

Home Office Deduction

While the Home Office Deduction is not some great new tax saving strategy, we work with every business owner that works out of their homes to ensure we have captured all related costs of maintaining their home office. We also can maximize the Home Office deduction for those that may not want to keep track of every utility and internet bill.

Mileage Deduction

This is also a long standing deductible expense, but has the potential to land the taxpayer in hot water if not properly documented.  Our CPAs and experienced tax preparers can provide tips and tricks on how to maintain a mileage log that will hold up to IRS scrutiny.  Also, to answer one of the most asked questions that we get –  the 2020 mileage deduction is 57.5 cents per mile.

Are you ready to optimize even more?

If you know that your business is ready to thrive, we are ready to help you grow to your next stage. From converting to an S-Corp to avoid a portion of your self-employment tax to hiring employees to getting regular financial statements and getting year-round tax advice, CS CPA Group will be here to assist you find the best path to success.

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