Thursday, January 29, 2009
EINs in Germany
This is my question: During my first deployment in Iraq (2007-2008) I started selling books, DVD, and other items online in my free time as a hobby, after a couple of months I was receiving more than a few hundred dollars from Amazon, Ebay and other websites for my sales every two weeks, but the net income was very small ex: of $600 amazon deposit, only $50 would be real profit.
In order to get wholesale prices from the on line suppliers I got an EIN (Sole proprietorship, internet sales) from the IRS website and I kept selling. I really didn’t know a single thing about taxes, I didn’t keep any records or receipts of the books or dvds that I bought to resale online….. and I didn’t take it in consideration when I got the EIN from the IRS either, that the Army taxes office in Iraq couldn’t help me to file my taxes because of that EIN. So I didn’t file in 2008.
After we left Iraq I stopped selling because I don’t know what to do with this tax and EIN situation, I want to fix this and find out how to keep selling without getting in trouble.
I read in the IRS website that you can cancel the EIN number and retake at any time, do you think I should do that?
I ‘ve been trying to talk to someone that does taxes for Americans here in Germany but it’s not that easy.
I would like to hear what you would do if you were me.
Thanks a lot!!
Do not get rid of your EIN. Having an EIN really doesn't make much of s difference in your situation.
Very simply: Keep on selling. Claim the income on your tax return and reduce it by your expenses. You must keep a record of expenses. On your tax return, your tax preparer will put your social security # and your EIN.
I have clients in Iraq and in Germany. I think you'll be able to find someone in Germany who can prepare your tax return for you. The preparer just needs to know the basics of filing a return for a self-employed person. Start by asking at the base then at the bank.