Any other small bidness owners here?

Jay Honeck

Jay Honeck

Touchdown! Greaser!
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Jun 6, 2008
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Ingleside, TX
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Jay Honeck
Just wrapping up the monthly agony of paying taxes. It's 12:15 AM, and all the parasites have been paid, leaving nothing left to speak of in the end. This after spending a full day hanging sheetrock, (we're remodeling another three rooms) followed by my regular shift on the desk.

Ah, the romantic life of a small business owner. :lol:

Any other gluttons for punishment here?
 
Jay Honeck said:
Any other gluttons for punishment here?
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Got an offer today to sell the whole thing, about ready to just take it. The agony of paying all those parasites every quarter is the main reason that sours the experience.
 
Let'sgoflying! said:
It sure is getting worse.
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Taxes were not any better the times I've owned a small business in the past.... but the regulations are worse now (part of the reason that I haven't jumped back into small biz again).
 
Yep. And it still beats going to the office.
Quickbooks is your friend.
 
Hmmm...maybe you need a better accountant, Jay. Or maybe a change of careers.

I own a small constuction company and I don't pay ****. My effective tax rate is far less than 10% (in '08 it was less than 5%). Everything is a write-off and then, after all the write-offs, our income is either sheltered or taken as dividends. At the end or the day our taxible income is roughly 20% to 25% or actual income.

Personally, I feel sorry for the W2 earners who, unlike me, really pay their fare share.

But this is spin zone mat'l.
 
I once ran a small business, with employees, full time. But I'm feeling much better now.

In addition to my dreary existence as a slave-wage earning W2 employee (pity me, Tim) -- with a liberal PTO policy and some nice bennies -- I run a mostly web based sideline that provides a modest amount of income from a modest amount of time and effort, and minimal tax and regulatory hassles. The best thing about my sideline business is that I know it could never grow to the point where it could replace my "real" job, so I'm not tempted to go that route again. :)
 
Could be worse Jay...

Join me on the farm where we get to purchase all of our land, fuel, tractors, parts, fertilizer, and seed at retail - then we sell our crops at less than wholesale...

denny-o
 
not me. my dad has since 1980. Dec. 31 is his last day.
 
he is sort of retiring in the sense that he has sold Woody's. He will still be working but this time he'll have a boss. I am not taking over, a local couple bought it.
 
tonycondon said:
he is sort of retiring in the sense that he has sold Woody's. He will still be working but this time he'll have a boss.
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Pluses and minuses.

I am not taking over, a local couple bought it.
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Too bad - think of the fly-ins!
 
timwinters said:
I own a small constuction company and I don't pay ****. My effective tax rate is far less than 10% (in '08 it was less than 5%). Everything is a write-off and then, after all the write-offs, our income is either sheltered or taken as dividends. At the end or the day our taxible income is roughly 20% to 25% or actual income.
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It's not so much the absolute tax rate, it is the number of different places that want their cut that has the high annoyance factor. Each of them with a different filing period, none of them talking to each other.
 
weilke said:
It's not so much the absolute tax rate, it is the number of different places that want their cut that has the high annoyance factor. Each of them with a different filing period, none of them talking to each other.
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I'd agree on that one. Having to pay federal, state, and local taxes, combined with the fact that each one has its own rules, times, etc...
 
Ted DuPuis said:
I'd agree on that one. Having to pay federal, state, and local taxes, combined with the fact that each one has its own rules, times, etc...
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I hope this is not spinzone material, but I believe that 10 million people would show up on payrolls tomorrow if there was a central way to pay all mandatory taxes+fees in a single monthtly transaction and if paying that monthly transfer immunized against payroll audits.

And htf do you end up with a fiscal year from 5/15 - 5/14 ??
 
timwinters said:
My effective tax rate is far less than 10% (in '08 it was less than 5%). Everything is a write-off and then, after all the write-offs, our income is either sheltered or taken as dividends.

But this is spin zone mat'l.
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I'm not sure how your business is set up, but dividend payments are taxable income from my s-corp. Dividends are "sheltered", if you want to call it that, from social security and employer withholding taxes, but they are carried over onto your personal taxable income. I believe that carry over vehicle is the schedule K-1 but I'm not positive on the document identity.
 
tonycondon said:
he is sort of retiring in the sense that he has sold Woody's. He will still be working but this time he'll have a boss. I am not taking over, a local couple bought it.
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And then when the new boss lays him off he can draw unemployment off him.
 
tonycondon said:
he is sort of retiring in the sense that he has sold Woody's. He will still be working but this time he'll have a boss. I am not taking over, a local couple bought it.
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Crazy. Was the delivery truck included in the sale?
 
CJones said:
Yeah.. Didn't he have a little S-10 that would never die or something?
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well, at one time he had a mid 80's (I think) full size chevy pickup that had just rolled over 100K miles when he bought it. The engine blew on the first night delivering pizza. He got another 100K miles of delivering pizza out of that thing on that engine although he did replace a few transmissions until a tree fell on it in about 1994.

Then there was the S-10 that I had as my first vehicle which I sold to him as a delivery car when I bought the Alero. It had this issue where the frame had rusted and shifted on the mounts enough that the linikage to the transmission wasn't quite right so it would slip out of Park and into Reverse. SOP was to not leave it running unattended and to put it in Neutral and apply the Parking Brake. One night a new driver didn't follow SOP and when they went back out with the next load of Pizza the truck was gone. It had backed itself through the full parking lot, across the street, and into the city park. Thankfully it hit a tree before it got to the river. It was sitting there with the wheels slowly spinning backed against a tree. Shortly after that Dad sold that pickup to his brother in law who I think is still using it as a farm truck. Last I heard they had blown a head gasket on it but fixed it and it had no doors.
 
Jay Honeck said:
Just wrapping up the monthly agony of paying taxes. It's 12:15 AM, and all the parasites have been paid, leaving nothing left to speak of in the end. This after spending a full day hanging sheetrock, (we're remodeling another three rooms) followed by my regular shift on the desk.

Ah, the romantic life of a small business owner. :lol:

Any other gluttons for punishment here?
Click to expand...

You don't want to know how much of that shhhh...stuff applies if all you "employ" is household help (think help for elderly, basic care stuff).
 
I've run my own business for over 35 years. I recently sold it and I am retiring on December 31st.

I started my business with a total of $250.00 in an old one car garage in 1976. Over the years I have been able to buy a house, almost have it paid off, only to have to mortgage it again to keep the business afloat.

It's been like caught in a storm in a small boat and surviving it through what often feels like just pure luck, then along comes another storm. I have been working up to seven days a week, only two one week vacations in the last 35 years.

At my peak I had 13 employees with a gross sales of close to a million dollars a year.
This last year, I have been the only employee.

As far as government and my little business is concerned, it has not really had all that much effect other than the taxes every month, which of course is the primary reason I had to lay off my entire staff. It was like trading dollars, a lot came in, a lot went out.

When I downsized my business I started making good money again, then came the collapse, and back to trading dollars.

It occurred to me that if I could do a reverse mortgage on my house, along with my SS, I don't have to do this anymore, which is exactly what I am doing.

If you like long hours, your money in spurts, usually a good distance between the spurts. Going in and out of debt. Continually dealing with assorted government agencies. Dealing with employees who think your a millionaire. Not being able to buy any big ticket item for yourself without angering at least a few of your employees who feel the money should have gone to them in the form of a raise instead, why then owning a small business is for you. Good luck with that.

Here is some free advise to those of you who are foolish enough to want or already have your own business.

There are only two ways of making money in a business of your own. Either be real small, or real big. G-d help your butt if you get caught between the two.

John
 
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Bob Noel said:
You don't want to know how much of that shhhh...stuff applies if all you "employ" is household help (think help for elderly, basic care stuff).
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If you employ them on the books it is almost more of a pia than having employees for the business.
 
timwinters said:
Hmmm...maybe you need a better accountant, Jay. Or maybe a change of careers.

I own a small constuction company and I don't pay ****. My effective tax rate is far less than 10% (in '08 it was less than 5%). Everything is a write-off and then, after all the write-offs, our income is either sheltered or taken as dividends. At the end or the day our taxible income is roughly 20% to 25% or actual income.

Personally, I feel sorry for the W2 earners who, unlike me, really pay their fare share.

But this is spin zone mat'l.
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You might want to be careful with that. The IRS expects you to pay yourself a reasonable salary that is taxable as regular income, before you take distributions taxable at the lower capital gains rate.
They've gotten a lot tough on that in recent years. Worth talking with your accountant.

But I agree, we get a lot of tax advantages wage slaves don't.

Disclaimer: Not a CPA, but an S corp biz owner.
 
Hmmm...maybe you need a better accountant, Jay. Or maybe a change of careers.
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Nah, we're just in the off-off-season. December is a very slow month here -- everyone on the island is losing money, and the owners that didn't plan for these lean times are going out of business.

We'll have another three months like this. Then, the insanity begins anew with Spring Break, and doesn't let up until Halloween.

Here, it's all "feast and famine", which is why we use this time to remodel.

I own a small constuction company and I don't pay ****.
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Nothing personal, but that pretty well sums up my experience with building contractors. After owning my own businesses for over 20 years, and employing dozens of contractors in various jobs, I no longer do business with ANY of them, unless forced to by law. Everything in your industry seems to be "fast and loose" -- and I'm not just talking about workmanship.

I had a flooring contractor come into my office just this past week -- I bought a pallet of ceramic tile from his company. He offered -- in front of my employees -- to waive the collection of state tax if I paid him cash on the spot.

Imagine, asking me to commit a misdemeanor (or is it a felony now?) in front of witnesses? He never batted an eye when I refused. (It's pretty funny, though -- when he made the offer, he had not yet sent me a bill, and didn't even know what I owed him for the tile, so I don't know how he expected me to pay him anything. :dunno: Another week has gone by, and he STILL hasn't sent me a bill.)

Many of my contemporaries who have survived in business for more than a few years have the same "I will do it myself" attitude. Funny how dealing with plumbers who show up late, treat you like crap, and then charge $800 to move a floor drain four inches makes you want to learn plumbing... :lol:

Of course, this puts us back in opposition with the same government who extorts the taxes, since you contractors have this wonderful love/hate relationship with the people who write "The Code". :rolleyes:

Personally, I feel sorry for the W2 earners who, unlike me, really pay their fare share.
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Although I have had years where I did extremely well, most years I end up making far less per hour than my employees. I have gone without pay in order to ensure that my employees were taken care of, and I know quite a few business owners who have done the same.

It's a life that's not for everyone, yet I wouldn't trade it for the world.
 
weilke said:
Got an offer today to sell the whole thing, about ready to just take it. The agony of paying all those parasites every quarter is the main reason that sours the experience.
Click to expand...

Here, it's a monthly agony. The state wants their cut, the locals want their cut, and the feds want their cut. Worse, in the hospitality business, most of these taxes are revenue -- not profit -- based. In other words, we pay them whether we make a nickel or not, unlike most taxes.

Interestingly, I figured out that 82% of the money I sent to the Feds yesterday goes to two enormous entitlement programs -- Medicare and Social Security. Just 18% is actually earmarked for day-to-day operations of the Federal Government.

I doubt too many people in the real world understand how huge those programs have become...
 
wsuffa said:
Taxes were not any better the times I've owned a small business in the past.... but the regulations are worse now (part of the reason that I haven't jumped back into small biz again).
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I will say this about Texas: The government is much less intrusive here than in Iowa or Wisconsin. I've owned businesses in all three states, and this one is by far the most business-friendly.

And yet it still sucks. :mad2:

I always marvel at the politicians who publicly rant and rave about how the economy is bad, and businesses are not hiring -- you know, the usual blather -- while at the same time have it within their power to change EVERYTHING for the better, and don't. The folks who don't own businesses do not -- cannot -- discern how two-faced their politicians really are.

But that's a Spin Zone conversation, there -- so we will step back from the precipice and just say that Texas rocks! :yesnod:
 
I run a company with 14 full time people..I pay 100% of the health insurance...a kick ass plan...very proud of the ability to do that for my team...

I make a decent salary, save some dough and still have money to invest in the company and pay myself and employees a nice bonus here at Christmas time...

It is a struggle as I watch regulation get deeper and deeper for no apparent benefit to anyone except the bureaucracy overseeing these regs....

All in all, I consider myself very fortunate...

I am thankful.
 
Our government started out relatively small, just a few guys is all it took to get the ball rolling. More like the snowball rolling, down a very long, steep hill. It now directly employs millions of people, and many, many, millions more indirectly. It has become a case of a very small percentage of our available work force is actually contributing to our gross national product, while that small percentage is expected to support all the rest.

That, of course, is impossible, so we borrow, even from governments that have social economic systems directly in opposition to our own, yet they have the money we don't have.

The problem with all of this is that every very long steep hill does have a bottom, usually a rock strewn fast moving river.

John
 
Kelvin said:
I run a company with 14 full time people..I pay 100% of the health insurance...a kick ass plan...very proud of the ability to do that for my team...

I make a decent salary, save some dough and still have money to invest in the company and pay myself and employees a nice bonus here at Christmas time...

It is a struggle as I watch regulation get deeper and deeper for no apparent benefit to anyone except the bureaucracy overseeing these regs....

All in all, I consider myself very fortunate...

I am thankful.
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What do you do?
Where are you located?
Are you hiring?

:D
 
Jay Honeck said:
Interestingly, I figured out that 82% of the money I sent to the Feds yesterday goes to two enormous entitlement programs -- Medicare and Social Security. Just 18% is actually earmarked for day-to-day operations of the Federal Government.

I doubt too many people in the real world understand how huge those programs have become...
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Hey, I live of those programs, dont you touch nuthin.
 
I went out on my own in 1995 just me and three other attorneys. We rented an inexpensive office a block from the courthouse. We purchase two computers and we worked off a 6' folding table and two folding chairs. We ended up buying used office furniture and with in 18 months my current partner and I parted ways with the then other three and have grown the business without other employees other than an secretary for several years which we now do not have.

I wouldn't say we are on easy street by any stretch of the imagination, there are days I love it and day's I hate it but I control my own desitiny and with that comes a good dose of stress. I've worked for folks that could pinch a penny until Lincoln cried and others that spent like a drunken sailor on shore leave. Now I get to decide.


CJones said:
What do you do?
Where are you located?
Are you hiring?

:D
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Chris if you have been to a concert east of the Ole Missisip, you have probably seen Kelvin's work. Worlds best concert and festival construction, stages, lighting equipment etc.
 
AdamZ said:
Chris if you have been to a concert east of the Ole Missisip, you have probably seen Kelvin's work. Worlds best concert and festival construction, stages, lighting equipment etc.
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Cool. I've done sound system setups and live mixing, but I tried to stay away from lighting and stage setup. ;)
 
Jay Honeck said:
Nothing personal, but that pretty well sums up my experience with building contractors. After owning my own businesses for over 20 years, and employing dozens of contractors in various jobs, I no longer do business with ANY of them, unless forced to by law. Everything in your industry seems to be "fast and loose" -- and I'm not just talking about workmanship.
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There are those, yes, especially across the south, and especially in residential contracting. I don't go there. I am a commercial contractor, take extremely good care of my one client (O'Reilly Auto Parts who I used to work for...ran their RE dept in the '90s), and cross all my "T's" and dot all my "I's". It's straight up, 100% above board, nothing fast and loose about it on either the tax end or operation end. And this is the way it is with most commercial general contractors because, even if they don't hold any allegiance to their client like I do, they're dealing with more sophisticated owners who have architects and engineers protecting them.

Chip Sylverne said:
You might want to be careful with that. The IRS expects you to pay yourself a reasonable salary that is taxable as regular income, before you take distributions taxable at the lower capital gains rate.
They've gotten a lot tough on that in recent years. Worth talking with your accountant.
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This has all be set up by our accountant.

She's awesome, she'll take you right up to that line everytime but she won't dare allow you to step over it. We're paying ourselves what she considers to be an acceptable salary but we turn right around and put almost all of that money our tax deferred retirement plans. The rest is taken in dividends. Just like you, we're running an S corp.

Chip Sylverne said:
But I agree, we get a lot of tax advantages wage slaves don't.
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Boy, howdy! When we first went into business, I can't tell you how many times I responded to my accountant with "I can do that AND not go to jail? YGBSM!"

Edit: As an aside, I've been through 5 audits of various types in the 8 years I've been in business. Nothing found in any of 'em, all lasted a small fraction of the time the auditors told me they would, and a few have simply walked away shaking their head at the overly anal detail with which my books are kept. I just smile and wave goodbye. My accountant loves me as much as I love her.
 
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We have a small U.S. eagle ring business I started as a hobby 13 years ago while flying back & forth from Chicago area to Florida, every week for almost 7 years. Long flights like that tend to get boring by yourself & most of the designs were sketched out in the cockpit

We only employ two people and its been a rewarding experience since the people we deal with are patriotic, most have served (we're licensed by the USMC), and the products are my own creations.

We haven’t had a lot of taxes to pay since the company (S Corp) doesn’t make piles of money. We also don’t have a lot of overhead since we make the rings one at a time as the orders come in.
No complaints here…
 
I admire people who start their own business. I tried to start a small engine repair business back in the 70s, and it didn't go too well. It did not last a year. I had to find another job to pay my bills, and before long I was spending more time at my paying job, and less time at my business. When my lease ran out, I had to let my shop go, and that was it. Much later, I tried to start an aircraft repair business. It really never even got started. I did not want to invest the amount of money into specialized equipment that I would need. That is on me. If I were a true entrepreneur I would have got a second mortgage on the house to do it. I just don't have the guts for it I guess. Anyway, for all you guys out there doing it on your own, good for you. I hope you all make it big.
 
Jay Honeck said:
Just wrapping up the monthly agony of paying taxes. It's 12:15 AM, and all the parasites have been paid, leaving nothing left to speak of in the end. This after spending a full day hanging sheetrock, (we're remodeling another three rooms) followed by my regular shift on the desk.

Ah, the romantic life of a small business owner. :lol:

Any other gluttons for punishment here?
Click to expand...

I own my own company, but we don't do local sales, so taxes are a bit less of a headache.

Internet biz has its pluses..

We've been around for almost 10 years and still clicking along.
 
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