Pixelrage.net

2009 was the first fiscal year I’ve done my taxes as an LLC. Things were bad enough as a sole proprietor, but now I can truly say that I know why people in this country are so frustrated and upset at the way we’re taxed. It makes me wonder how it’s even possible to start a business in the United States.

As an LLC of one person, I wanted to simply use TurboTax or H&R Block to get my taxes done on my own. I wound up going with H&R Block Small Business, which wound up being the wrong choice. The Small Business edition is only for LLCs or other entities with more than one person working under them, not for 1-person LLCs (which are taxed similarly to sole proprietorships). Oops, what a waste of an extra $20.

The Rape of Small Business Owners

H&R Block was relatively easy to use. Since I own no property, have no kids and no gambling debt, I breezed through the process relatively quickly. On the upper right hand corner of your screen, your debt to the national and state government is calculated with each page you complete. Finally, once reporting my earnings, I noticed that I nearly owed the government(s) 5-figures. It’s a complete outrage.

It seems like 50% of what you make is taken away. How on earth is a start-up supposed to survive, considering that the “president & CEO” IS the company? How do start-up businesses afford to get an office? Does the government truly expect you to sacrifice (risk) a major part of your personal savings to keep your business going on a regular basis? I think it’s a crime, especially as an affiliate marketer. No matter what kind of affiliate marketer you are, 5-figures torn from your clutches is completely devastating.

Don’t Be Shy to Claim Away!

This April, I’ve learned the value of claiming business expenses, which shaved off a good $4,000 from that final figure. All it really does is alleviate the shock and awe of seeing a horrific number like that – in actuality, it’s money you never made,  but put toward things you needed to buy. Either way, money that doesn’t wind up in your pocket at the end of the day. In my case, it’s in GoDaddy’s pockets, as I own and maintain over 430 domain names which have become rather costly.

I suppose I can see why many start-ups and affiliate marketers either give up in complete frustration, or look toward alternate income methods. Affiliate marketing and multiple website maintenance is hard work [mostly because of stupid link building obligations] and it never ends.

This year, I’m putting a serious effort toward dropshipping. Either that, or I might go with my idea of joining tons of small affiliate programs and stopping them once they reach just under $600 so that I don’t have to report them :)