Do I have to pay taxes on this???
Hi All,
Sorry this is long, I just want to be thorough. I relocated from Tennessee to Indiana to pursue real estate in September of 2015. The job was paid primarily on commission, so I felt comfortable making the plunge to a new city with an income that was not guaranteed since I had done it before when I moved to Tennessee. I had a great relationship with the owners so the job that I was working in Tennessee agreed to pay out my commissions from deals that I closed before moving to Indiana. These commissions will continue to be paid until Feb 2016 until the projects are complete. My first question is, since Indiana has a 3% income tax do I need to claim it as income and pay the 3% since I am now living here? The company is not registered with Indiana as an LLC so I am not sure if it matters across state lines.
My second question is, when I moved I formed an LLC in Indiana in October 2015 and registered with the IRS to get an EIN. As you may have also experienced in RE, it can take some time before deals start closing and money rolls in. Consequently, I did not have any signifiant financial transactions with the LLC. The only thing that happened is that I received a check for $350 for helping someone with a lead on a house, but they paid me by check and it was made out to me and not my LLC. I have not cashed it because I want to keep my books clean and not have any "business" money in my personal checking account. It might be silly, but I have not opened up a business checking account because the minimum for the bank I want to use is $1,500 (anything under is charged a $10 per month fee for not having the minimum). Thankfully, I have closed some deals in 2016 so I will soon have the "business" money to put into the account that will allow me to open it without having to pay the monthly fee. Do I need to do something tax related with this $350 or not? I think the guy will end up sending me a 1099. Thirdly, do I need to do any taxes on my LLC if nothing was really done?
Any advise is greatly appreciated.
Thanks!