Sunday, August 5, 2007

Indie business Mindset: Success starts with homework


My business is manufacturing of pneumatic cylinders since 2005.

If I had a refund for the tax year of 2005 and I owe for the tax year 2006, why do I have to pay an estimated tax now for tax year 2007?



Refund or owe is not a determining factor in whether or not estimated tax payments are required. Payments are determined by your entire tax picture. For an explanation, take a look at Estimated Taxes posted earlier.

If I may, I am going to use your question as an example for other blog visitors. My goal for my blog and website and all my other writing and speaking is to get as much accurate, clear, simple information to as many indies as possible.

I also work at teaching indies how to get information. Many people who have read my book on tax basics send me beyond-the-basics type questions. Or people have unique situations like those of a cruise ship entertainer who lives on the ship, or a graphic designer who signed a really bad work-for-hire contract. I am still doing research on several of these kinds of questions received recently.

But with a lot of questions that I get it's obvious that no research effort has been done. A smart question goes something like this: "I have read your 5 or 6 posts on estimated taxes and still have the following question ..." [Categories are on the left. There's also ARCHIVES on my website.]

Do your homework, get some background on your question topic. If you know nothing, how will you know that my answer or anyone else's is correct?

My husband was an investigative reporter for a long time and he always did his homework. He told me that only if you really knew the background of the person your were about to interview would you be able to tell whether his answers had the ring of truth. Often he'd start with a question to which he already knew the answer.

Remember, you are a professional. You must have an indie business mindset in order to be successful.

-- June

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