I have stupid question along the lines of the tax plan....and I dont know if this belongs in another thread or in it's own but I was wondering so I thought I would ask.
I kind of need to set up the scenario for you to : for six years my Dad has managed the Vespa Washington store to be one of the top ten grossers in the country (for Piaggio, USA : the parent of Vespa). However...due to the bad money management practices of the owners, the store is going bankrupt.
So here is my Dad and all his employees including the service guys....out of a job. They've been talking about purchasing a store and reopening the franchise as the new owners...they've found a store in friendship heights that is a good size, good location, and is affordable. They'r eplanning on going through the small business beareau for the loan to start up.
Now into the thing I was wondering....In a couple of years it is very possible that my Dad and his partners will be grossing 250,000+...and all this after working it from the ground up. HOWEVER - their net income will be far less then that -- they'll be paying of the expenses of purchasing the bikes, the loan for the startup, the cost of real estate in a posh location of Washington DC...in fact they'll probably be making just enough net to get by with paying themselves.
So my question about the Obama Tax plan is the 250,000 Gross (Overall Income) or Net (Gross - expenses).
I'm curious because this is my family...and I can't see the business getting off the ground if they tax the Gross income when the net is going to be so small in the first few years. I havent been able to find any references to the net vs gross anywhere....so if you could show me where it is that would be awsome.
~Cate
PS....my Tax experience is limited...i know the big words....but other than that Dad helps me with my own
I kind of need to set up the scenario for you to : for six years my Dad has managed the Vespa Washington store to be one of the top ten grossers in the country (for Piaggio, USA : the parent of Vespa). However...due to the bad money management practices of the owners, the store is going bankrupt.
So here is my Dad and all his employees including the service guys....out of a job. They've been talking about purchasing a store and reopening the franchise as the new owners...they've found a store in friendship heights that is a good size, good location, and is affordable. They'r eplanning on going through the small business beareau for the loan to start up.
Now into the thing I was wondering....In a couple of years it is very possible that my Dad and his partners will be grossing 250,000+...and all this after working it from the ground up. HOWEVER - their net income will be far less then that -- they'll be paying of the expenses of purchasing the bikes, the loan for the startup, the cost of real estate in a posh location of Washington DC...in fact they'll probably be making just enough net to get by with paying themselves.
So my question about the Obama Tax plan is the 250,000 Gross (Overall Income) or Net (Gross - expenses).
I'm curious because this is my family...and I can't see the business getting off the ground if they tax the Gross income when the net is going to be so small in the first few years. I havent been able to find any references to the net vs gross anywhere....so if you could show me where it is that would be awsome.
~Cate
PS....my Tax experience is limited...i know the big words....but other than that Dad helps me with my own