Originally Posted by kmendez
Hi there, I legally live in the US and i own an online marketplace. I do not directly sale anything (Independent sellers, artists, other stores and companies can create a seller's account just like amazon) I just comission 5% of everything that gets sold. I'm going to list the especific information about how the bussiness works;
1) PAYMENT SYSTEM: The online marketplace uses Paypal adaptive payments, wich means that when someone buys a product the payment automatically splits in 3 parts (Vendor gets his payment directly to his paypal account, I get my 5% and Paypal gets its transaction fees) This means that money NEVER touches bank accounts just go directly to both Paypal accounts after transaction fees.
2) INCOME TYPES: Apart from sales comission I also recieve online advertising and PPC (PayPerClick) earnings from advertising networks, that income goes directly into my Paypal account aswell.
3) INCOME VOLUME: I's been only a few months and i already made almost $50,000.00 (sales and advertising income conbined) that's like 20- 25,000 transaccions per month (I have to check my records to be shure).
4) COSTUMERS: i live in USA , and my bussiness Pro Paypal account (They charge $10 monthly + transaction fees (0.30 - 2.9%) is US based aswell, but my customers are in Latin American countries and its getting quite popular so i assume that at the end o this year I'll have more than 25,000 transactions per month.
So, i would like to know how to do taxes the rigth way to not jeopardize my US residency,
So, i would like to know how to do taxes the rigth way to not jeopardize my US residency========>>UNLESS you are a sales EE receiving a W2 from your employer , you are an independent contractor. As you are not an employee and work on your own, you will pay taxes a little differently than employees do. Nobody pays the employer portion of social security taxes on money paid to you independent contractor because you, as a contractor are a self-employed person and must pay the taxes on your own. So, basically, as a self employer, aslongas the amount reported on line 29/ 31 on yur Sch C of 1040 is $400 or exceeds $400, you need to file your return and also aslongas the amt on your Sch SE of 1040 line 2/ 3 is $400 or exceeds $400, then, you need to pay self employment however on 1040 , you can deduct 50% of your self employment tax. As you are filing as a sole proprietor and/or a self-employed individual, you generally have to make estimated tax payments if you expect to owe tax of $1K, I mean tax liability after refundable/nonrefundable credits, or more when you file your return. You do not have to pay estimated tax for the current year if You had no tax liability for the prior year; you were a U.S. citizen or resident for the whole year; your prior tax year covered a 12 month period. For estimated tax purposes, your tax year is divided into four payment periods. Each period has a specific payment due date apr 15, June 15, sep 15, jan 15 of next year If you do not pay enough tax by the due date of each of the payment periods, you may be charged a penalty even if you are due a refund when you file your income tax return.