Entrepreneurship is like jumping off a cliff and trying to build an airplane on the way down.
Since this is my first year doing taxes as a sole proprietor of an LLC, I'm curious to know how anyone else handles their tax stuff. The amount of business I do hasn't justified any type of book keeping software, so to date I've just been keeping receipts in a folder and tracking sales using the Paypal Here app. I'm assuming I need to classify 3 things: revenue, expenses, and capital? Is there a certain dollar amount to the IRS that has to qualify as capital (aka depreciable deductions?)
Also as I understand it, I need to make a table of all my tools, what I paid for them, assign a percentage of "personal use" and then use the MACRS table to determine the depreciation. Do you do the same thing with utilities? All my work happens in the attached garage, so it seems logical I should be able to count some amount of power, water and internet as business expenses. What about my car that is all stickered up with the S&S logo. Obviously I can count miles going to shows and to get materials as expenses, but is the cost of that vehicle (minus the personal usage percentage) valid for depreciation? Does that then make it a commercial vehicle and affect my insurance? What about the house? Now I see why business people wait so long to finish their taxes.
As you can tell, I haven't though all of this stuff out. Any experience that ya'll have had would be valuable information.