Small Business Taxes Made Easy, Third Edition, 3rd Edition

5

INCOME

It’s just as easy to love a rich man as a poor man.

—YOUR MOTHER

Money In, Money Out, Wave Your Hands All About

You’d think income would be the easiest concept for a business owner to grasp. It seems completely obvious to you, right? Income is the money that came into the business. Clearly, it’s all the money that was deposited into your account.

But what if you don’t have a business account? Or you use your personal account most of the time instead? Then, how much is income?

The following question is typical of a new business owner:

I am self-employed as a carpenter. When someone pays me for a job I’ve done, and he pays me by check, ...