This is the kind of person that gets business funding...his parents had money or he inherited money...he got funded literaly so they can put him in debt his whole life...but nobody around him has ever questioned him.
A lot of business owners stumble into it after their hobby/side hustle takes off. I have a lot of sympathy for them because they weren't expecting things to be more than small time. People like this caller actively went looking to start a business. He has no excuse for not doing the basic research on this stuff. He isn't a guy that offered to paint his neighbours house for some cash and ended up with 5 employees due to people calling him up wanting his services. That would be a completely different story.
I knew a guy that was new to a business that hadn't filed for a few years. When I asked him about it he said "should be fine, I'll be getting a return" I had a pretty good idea of what he would owe but kept quiet other than encouraging him to file asap. I know a few guys that owe the governments sums of money they'll likely never pay back, it sucks but it's half the business, you have to decide to be a big boy when you run your own business.
Great advice! I took that class as a student and then I helped teach it. Fully half of my time on my small business is spent doing basic accounting and basic finance: Accounting 101 and Finance 101. The other half is creative efforts to add value. Never underestimate the importance of the boring dull, but essential, accounting basics.
And Quickbooks and an accountant who offers bookkeeping services to do the quarterly and annual tax reports and payroll and financials. Gotta give him credit for calling in!
His business is probably operating at a loss _because_ he's paying himself, but he doesn't understand that because he doesn't understand accounting, taxes, business, finances, economics, etc.
Yeah, that's terrifying. I feel like the IRS should flag this guy, somehow I don't think he would be paying taxes and keeping his books clean even if business was booming.
The American addiction of opening business when they don’t know ANYTHING about business surprises me every time. For gods sake take a couple of accounting classes finances and small business management at community college. You can do that for 1k in most states. People think business are run by crazy sales people running around selling and bsing theirs way through things.
How Americans can go out get married, have kids, buy homes, take out loans for businesses/education when they are already tens and thousands of dollars in debt is beyond me. I would like to know the secret to how they sleep at night.
These calls drive me nuts, when the caller doesn’t know what they’re talking about - when they’re talking about their own situation! Total cluelessness. “Not really .. yeah, I mean.. if you put it that way”. George face palms.
As soon as he stated he didn't know what to pay himself and mixing monies, I said out loud, no CPA, no taxes paid. This guy shouldn't be self employed!
@@peterrose5373 Government is BIG business, and successful businesses have a governance. They both pretend to be familial, and bad things happen when this is allowed to continue unchecked.
Not separating biz and personal finances is the #1 mistake any small biz owner can make. I didn’t do it for the first two years - spent every dime I made. Once we separated them we started stacking cash like a bandit.
@@ASimoneauas a sole proprietorship, it's bad business. As an LLC, it can "pierce the corporate veil" and essentially waive the protections an LLC would otherwise give you.
@@ASimoneau It's not illegal to _pay_ for personal expenses out of the business account, but it IS illegal to deduct those personal expenses as business expenses, and it's very difficult to do proper business accounting if you don't keep everything separate.
@@ASimoneau the best way is to keep them completely separate - if you want to pay personal expenses out of the business you should do a distribution from your business to your personal bank to keep everything clean on paper
I mean....he isn't filing taxes and admits to that on a national radio show....has no idea how much money he makes...living on credit cards, but is taking money from the business. Huh?
I’ve ran into this a bit. Buy and sell buy and sell and never get caught up. One day you start to realize if you just got a 9 to 5 with benefits you’d be better off
This is how the economy will fall. People stop paying debts and take out credit cards to get by. Just like every crash before it. Mortgages are always last
I have encountered a lot of small business owners that don't do a good job of determining their profit and loss. And to make matters worse, when they don't know their P&L they can't calculate their REAL hourly rate.
If he's not filing, they may not notice him for a while. As soon as he DOES file, they're going to wonder where the last several years of data is, but if they do notice him before he goes to them, they're going to be punitive.
What gets me is people like this who clearly have enough intelligence and skill to start and operate their own business, but on the other hand, lacking intelligence to manage simple finances, or file taxes. How does someone get to that point in their life?
I’m not sure how many Avi’s that there are in Philly, but I assume that it’s few enough for the IRS to figure out which one isn’t filing taxes for their business.
This is a classic case of people who should never have a small business! He should have went to Small Business Administration/SCORE first before starting a business. This is cringe worthly. 😬
Yeah, let's call a show with national listeners/viewers and air our laundry about not keeping up with taxes. I mean it amounts to this: weeelll. "I am a professional hit man and I just don't know if I am getting rid of the bodies correctly" that will draw some eyes your way. I mean if you want the irs to take note. Congratulations. Mission accomplished .
Epic Fail lmao , go get a job my guy, your drowning & not providing for your Girl, she’ll soon reconsider her options which if she’s a 5 out of 10 she already got 9 dudes hitting her up 😂😂
Geez 🤦🏻♂️, I swear so many people just want to have a business to tell people they have one. I have a brother in law who has one that doesn’t make money but tells everyone he’s a business owner and fluffs it up.
Yeah… just get a regular job at this point. If not then get shit in order, are u making a profit on the business great just clean it up, if not get a job. Then start the baby steps. Stop eating out, stop shopping anything that isn’t groceries. Stop being all over the place.
What he SHOULD do get a new wallet (to break any storage habits) and write on his business cards with a sharpie. Then store the business cards in one side and the personal cards in the other side-- equally accessible but in distinct places. And after that, he should ensure his working contract is clear about what the client agreed to and can get very comfortable writing Change Orders. He can pretty quickly present the client the change order (15 to 30 minutes lost?) to address their concern, instead of bending over and helping them out. In construction, your profit margins can disappear pretty quickly if you don't do things right. Subs are expensive, there's more overhead than you think, and taxes will take you time and effort. It's tough to keep the folders together as well-- most GC's aren't organized (at least in a business sense). You might quote a home to use 2" brick or 3.5" flat around the doors but then the client stops you and wants it to be a 7" fluted and a decorative crosshead-- because that's what they thought they were signing for. You already have the 2" and 3.5" trim on the truck and built it into your cost, and don't have the materials with you to do what they now want. It'll also take longer, since you have to cutback the siding. So you call your suppliers and write the change order-- $300 for the basic version of the fancy trim detail, plus $600 for labor, plus $20 for siding accessories, plus $80 for the round trip. They can either have you complete the job as the original contract was written, pay the $1000, or you can leave and attempt to collect the debt later (perhaps by getting a construction lien for the unpaid sum and then suing to collect).
Im not sure why people like this think they can make a living on their own with no knowledge of business or what it takes to run a company. The construction industy is full of people like this. Throwing garbage quality work around and making it very difficult for legitimate businesses
Both technically. Legally it depends on whether that personal expense is beneficial business wise or not. The IRS has strict guidelines on that stuff. It's best just to keep them completely separate.
How does one run a business without knowing how to log profits and losses. That's like the entire point of running a business. And to have a wife and kid while doing this crap
The best way to start a business is total up your household expenses, and then save one years worth of expenses then open your business and give yourself 11 months to make it and one month to find another job if you can’t
wow, I flip homes and this guy is a joke. i paid my 20k business credit off, profits are low this year. my taxes are paid. home just got paid off, my car is paid off. But I am poor on paper. he has a spending proproblem. I bet the wife or girl friend is sucking this guy dry.
We only got know to he has Buisness loan, credit card debt and unpaid taxes. I bet he must have 80k auto debt for a truck because he’s a ‘Buisness owner ‘ 😂😂
