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Crash64
10-17-2004, 12:46 PM
Hello,
I have worked in the administration field of web hosting for just over 2 years now. I was talking with a few co-workers at work, and the 3 of us got talking about how we would like to start up a completely free hosting firm. We sat down last night online and explored the idea it further. But, we could not answer one question, Are we going to have to pay tax's?

Our hosting firm would run like this. We would buy two packages both with WHM and cPanel and one with Fantastico De Lux devide thes up and offer them to people. We each would pool our money to pay for these packages. We would put some type of ad that paid out per click at the top of our site. Until we were reimbursed the money we invested. Then as we made money we would buy more space and bandwidth.

So can some one tell me can, we go right into this, or are we going to have to register with the IRS or something of that sort? or are we going to have to pay some sort of government fee (TAX)?
UltraMatrix.NET
10-17-2004, 02:30 PM
you might want check gov in this. if you in canada you can call gov canada. but i dont about otheres.
Crash64
10-17-2004, 02:50 PM
Well we all live in the US? So......
Uncle Mad
10-17-2004, 02:51 PM
Then i suppose you need, since you are indeed generating profit from other sources.

It's like filing income tax, you don't only file your gross salary, but also earnings/incomes from your shares, property and such.
Crash64
10-17-2004, 02:56 PM
Well since we arn't really looking to make a profit, all the profits would go to buying more space and bandwidth. None of use would be getting anything out of it. (Well for a while any way.)
Crash64
10-18-2004, 02:31 PM
So whom would I contact in the goverment? IRS?
Crash64
10-20-2004, 03:14 PM
Any One?
JTY
10-20-2004, 04:47 PM
Talk with the IRS, they are the tax people.
Zealus.com
10-21-2004, 02:19 PM
Talk with your accountant - you'll get better understanding :)

Basically, it boils down like this - whatever money you put is called "investment" and is not taxable, Whatever money you have earned is called "return on investment" and is taxable if gross return is more then investment made. That's the raw picture. Your accountant is the best source of such information. IRS, though the government organization, is not on your side in this case :)
rackley
11-18-2004, 04:40 PM
Well, if you have Google Ads on your site they will tax your payment, but i am in the UK and i am not taxed when using Google.
Daniel
11-20-2004, 03:13 PM
If you will receive any money from the sites you will probably have to pay taxes. If you are in the US and use AdSense, google will take the tax from the money. If you are in other countries you pay the tax yourself.
Crash64
11-21-2004, 11:48 AM
Well, if you have Google Ads on your site they will tax your payment, but i am in the UK and i am not taxed when using Google.

Yes, I just looked they tax US residents by using there Social Security Number. So let me ask the question with different variables

If we did this our and if our total cost is $300 USD per year. We startup and offer hosting then place google adsince on our site till we either brake even or make under $300 USD (In other words take a loss). The $300 USD will have been taxed using our SSN. Do we still have to file with the IRS or pay any sort of tax?
Crash64
11-22-2004, 09:05 PM
oops just saw this.....

If you will receive any money from the sites you will probably have to pay taxes. If you are in the US and use AdSense, google will take the tax from the money. If you are in other countries you pay the tax yourself.

No, we have no intention of charging the clients for there sites.