Net income

petersonra

Senior Member
Location
Northern illinois
Occupation
engineer
Can you just elaborate on that? You mean you know what your company charges and compared to your pay it would take about 8 hours of billable time for them to profit?
No it is more like I know what it takes to do all the paper shuffling to get a 4-hour job through the system and billed. Plus a lot of times there is a couple of hours of my time spent on it either before or after coming back from a service call that doesn't get billed but I get paid for.

I think there is a minimum $500 charge but that's barely 2 hours at the rate being charged. I think it used to be a minimum of 4 hours but somewhere along the line it changed to a minimum $500.

Plus these kinds of things disrupt my day. I spend most of the rest of the day complaining about it so I probably don't get anything else done that day. :)
 

kwired

Electron manager
Location
NE Nebraska
I'm curious how do you pay yourself, do you take certain amount each week as a salary? I worked for an owner who paid himself $25k a week.
Depends on how you are organized, corporation, LLC, sole proprietor.

Sole proprietor basically is paid by net profits as the business and individual are the same entity.

Other business entities are separated from owner so any profits not paid to owners stays with the business and business files separate income tax returns from the owner(s). I guess if your business pays you a salary you would be taxed on those earnings even if the business had a net loss for the year, that owner salary is nothing more than an expense to the business entity.

$25k a week is probably not a one man operation, especially in a business that mostly provides installs/services, unless they also sell very pricy items as part of what they do.
 

petersonra

Senior Member
Location
Northern illinois
Occupation
engineer
Depends on how you are organized, corporation, LLC, sole proprietor.

Sole proprietor basically is paid by net profits as the business and individual are the same entity.
It depends on how you elect to be taxed. You can elect to have the profits/losses of the business pass through to the owners. This is often referred to as a subchapter S entity. I think you can have any business structure you want and still elect to be taxed in this manner as long as you meet the requirements.
 
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