What are one-man operations earning per year?

Status
Not open for further replies.
The person who works in the school system making 80k plus benefits with vacation days and sick days are very hard to come by. They are out there but depends where you live. Being self employed in my opinion is that same as working for someone but a little more homework. If I work for an electrician and he sends me to a job its my responsibility to get it done. No different in my opinion if I was on my own. Only pain in the ass is looking at a job or doing billing when you don't feel like it. All depends on what you want in life. If you do the same, expect the same. I recently started my own company and i've been happy with it. it is a lot more time but its time how i choose.
 
HuntNJ said:
The person who works in the school system making 80k plus benefits with vacation days and sick days are very hard to come by. They are out there but depends where you live. Being self employed in my opinion is that same as working for someone but a little more homework. If I work for an electrician and he sends me to a job its my responsibility to get it done. No different in my opinion if I was on my own. Only pain in the ass is looking at a job or doing billing when you don't feel like it. All depends on what you want in life. If you do the same, expect the same. I recently started my own company and i've been happy with it. it is a lot more time but its time how i choose.
Click to expand...
There is a big difference from being the owner and being employee. Employee makes an oops, who is left holding the bag? The owner. Employee get tired of job and walks off, who is holding the bag? The owner. Job starts to go sideways employee stills gets paid, owner looses money.
Of course as owner it should be expected the greater risk should equal greater potential for rewards and if it's not then why be the owner. Employee shares very little risk (financial).
 
A lot depends on what you want out of life. If you want to work 40 hours a week and not worry about the business the rest of the time starting your own business is probably a bad idea because you will never work 40 hours a week. It will be more like 60 or 80 regardless of what you think it is.

Personally I have no desire to start my own business. The risks are much higher than most people believe and the reward is generally much lower, although there are a handful of exceptions as some people here have stated is the case for them. The reality is that something like 95% of all small businesses die in the first few years. That's not a very good track record.

There are some indirect benefits to having your own business. The tax benefits are grossly overstated though for most people. You can deduct all kinds of business expenses, but it's not like you made money on that it's money you spend on the business. That's why you get to deduct it. Unless you are cheating on your taxes you don't really gain anything by paying for these expenses yourself as opposed to having the employer pay for them. You do have more flexibility if you are the owner and you want a nice big truck as opposed to a van you can just do it. And you can use it on personal business, until the IRS catches you doing it and not paying taxes on that part of the truck expense. Then it's tax fraud. Although it's not like a whole lot of people ever get caught.

For most businesses is very hard to make more money by yourself than working with a small group. But if you don't want to have employees and the hassle that comes with having employees, chances are your not going to experience the benefits of having those people around you for the many times when they will come in handy.
 
petersonra said:
.

There are some indirect benefits to having your own business. The tax benefits are grossly overstated though for most people. You can deduct all kinds of business expenses, but it's not like you made money on that it's money you spend on the business. That's why you get to deduct it. Unless you are cheating on your taxes you don't really gain anything by paying for these expenses yourself as opposed to having the employer pay for them. You do have more flexibility if you are the owner and you want a nice big truck as opposed to a van you can just do it. And you can use it on personal business, until the IRS catches you doing it and not paying taxes on that part of the truck expense. Then it's tax fraud. Although it's not like a whole lot of people ever get caught.
Click to expand...
I have to party disagree. My expenses are a lot less than they are on paper. It's just the way the tax code is. Then you can do things like calling some of you income "rent" or reimbursements from your corp instead of income which cuts down on self employment tax. These things are well established and the IRS is fine with it.
 
electrofelon said:
I have to party disagree. My expenses are a lot less than they are on paper. It's just the way the tax code is. Then you can do things like calling some of you income "rent" or reimbursements from your corp instead of income which cuts down on self employment tax. These things are well established and the IRS is fine with it.
Click to expand...
There are some fine points to it but the huge amounts of money people think they will save on income taxes by deducting things is not the reality for most small businesses.

Then there are the things that people do that are really close to or over the line of being IRS legal. Mostly people get away with them because the IRS really does not care all that much about a few hundred dollars in taxes one way or the other.
 
AC\DC said:
I like a one man shop but I don’t want to do physical work my hole life.
is it not the goal of a business to expand so even if you take a “ vacation” or start another business the other is still making money for you?
I know it will always have to be managed but should it not be from a distance.
I want several business not just one. I have ADHD and already bored with current job.
Click to expand...
How about those handymen I see everywhere? No license, maybe insured, no codes to follow, just making as much money or more than us and always have work. My next business may just be doing that.
 
I don't know any handyman that is making what I am. The Repair company that are aka Handyman around here are legit business and don't touch my wire. I turn people in for touching my stuff.
 
Very few companies in my area pay journeyman over $25 an hour so the decision to become self employed was much easier. You can make more if you keep it simple as a one man operation and can get customers in affluent areas. You should become self employed for reasons beyond money. I think you should only become self employed if you have a strong desire to learn all aspects of operating a business and also would prefer to turn down certain jobs that your boss used to take. I'm not making much more than I was before but I absolutely love learning new things and being responsible for determining how the job is going to be done.
 
blueheels2 said:
I’m not making it yet but I think 250-300k would be the absolute max in my area. That’s total sales not bring home. I have a single man shop and I paid myself the equivalent of a 90k salary. Hope to push that up to 110 next year but we’ll see.
Click to expand...
Thats great to hear, thank you for sharing. I am a single man show and want to keep it that way so seeing what's being made out there is helpful
 
Amps said:
How about those handymen I see everywhere? No license, maybe insured, no codes to follow, just making as much money or more than us and always have work. My next business may just be doing that.
Click to expand...
The people that hire them should not be your target customer, they just want it done cheap, not realizing cheap can be dangerous.
I used to try to compete with those guys, but all you do is lose money. I recently had a builder that wanted me to wire his custom homes, when I told him I was too expensive for residential, he said he didn’t care, he wanted it done right, and knew of my reputation. His clientele didn’t mind spending money to get it done right.
 
hillbilly1 said:
The people that hire them should not be your target customer, they just want it done cheap, not realizing cheap can be dangerous.
I used to try to compete with those guys, but all you do is lose money. I recently had a builder that wanted me to wire his custom homes, when I told him I was too expensive for residential, he said he didn’t care, he wanted it done right, and knew of my reputation. His clientele didn’t mind spending money to get it done right.
Click to expand...
I like that..."I'm too expensive for residential".
 
petersonra said:
There are some fine points to it but the huge amounts of money people think they will save on income taxes by deducting things is not the reality for most small businesses.

Then there are the things that people do that are really close to or over the line of being IRS legal. Mostly people get away with them because the IRS really does not care all that much about a few hundred dollars in taxes one way or the other.
Click to expand...
I know of a contractor in my area who has a "company" boat. He paid for his 75k bass boat with company funds and then wrote it off as a business expense - entertainment of clients. I asked him who told him he could do that and he said his accountant. Man, what a crappy accountant...
He's gonna be in for a big surprise if he gets audited!
 
No he not, if he can prove he used/ uses for business purpose. Maybe he also uses to get to jobs on a lake. Learn the tax laws will open your eyes.
 
Last edited:
I heard of a contractor doing that and said he needed it for installing and repairing dock lighting. Not a bad idea. ;)
Wish I could afford to buy a $75k boat!
 
Dennis Alwon said:
If you are an efficient worker you make $100,000.
Click to expand...
If it is all labor charges yes.

If you happen to be in some sort of niche where you sell a lot of high priced items, you possibly could make more off items sold than off labor charges.

Self employed also may end up with somewhat inherent "personal benefits" from business property which they can take tax deductions on where if you are just employed by someone else you can't write off those items or expenses related to owning those items.
 
AC\DC said:
No he not, if he can prove he used/ uses for business purpose. Maybe he also uses to get to jobs on a lake. Learn the tax laws will open your eyes.
Click to expand...
you can also take vacations and deduct many expenses (travel, lodging, meals...) if you happen to conduct any business activity while on that trip.
 
electrofelon said:
There is no way I am aware of to deduct time. If you do a job and get screwed and not paid, any materials of course can come off as expenses but the time itself is time you will never get back 😥
Click to expand...
Correct. Though I was told that when I was an LLC. Now I am INC and an employee of the business. Maybe with a different entity it will work. Every one pays so far so have not pursued.
 
AC\DC said:
Correct. Though I was told that when I was an LLC. Now I am INC and an employee of the business. Maybe with a different entity it will work. Every one pays so far so have not pursued.
Click to expand...
You can write off bad debt as a business. But, it depends on how you account for business you get.

There are a lot of people playing fast and loose with the IRS rules on business deductions. Sometimes it is enough that the IRS notices and goes after them. Most times the amount is small enough they don't care.
 
Status
Not open for further replies.
Top