Maritime job and taxes

USA Discussion in 'Individuals' started by Alvaro Aicardi, Apr 12, 2017.

  1. Alvaro Aicardi

    Alvaro Aicardi

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    I started working in boats with salaries above average than the ones that I get on land based jobs.
    After an Alaska season I got about 30 k in three months after taxes.
    The pay before taxes was 45 k.
    So, my simple math tells me 15 k went to the IRS, social security and medicaid. That is about 33%.
    If I do the taxes with the standard deductions I get a refund of 5 k which leaves the IRS with 10 k of my
    hard earned money. These are all round numbers.
    By the way I do claim single status.
    Instead of doing the standard deductions I would like to deduct my own expenses in order to get
    back all the money that the government takes away from me.
    So if I get that percentage or amount that they take from my check, would that be the amount of money
    that I would have to spend in deductible expenses in order to break even?
    Because I work in the maritime field, what specific expenses can I deduct? Travel expenses like flights, lodging,
    car rental and the like or what else?
    When I pay for those expenses, do I have to pay with a debit card from the account the wages go into or
    can I use any credit card?
    There are many other jobs in the industry that pay straight (1099) money so I have to come up with some
    expenses if I do not want to end up paying a lot of my income as taxes.
    Is it convenient for me to open an LLC for this last case or for any employer and work as a contractor instead of
    as an individual?
    I strongly appreciate any advice.
    Thanks.
     
    Alvaro Aicardi, Apr 12, 2017
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  2. Alvaro Aicardi

    Cherie CPA @firm1040

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    Alvaro,
    As a 1099 consultant, you need to save everything and take to your CPA, let him determine what's tax deductible and what's not, (KEEP EVERYTHING) even if it's personal expense, sometimes personal expense that aids in your business is tax deductible. As for the other position, for expenses, it would be unreimbursed expenses such as mileage, travel, education, etc. Just so you're aware, these expenses are miscellaneous deductions and are added back for AMT purposes (if trump doesn't eliminate). When in doubt keep everything.
     
    Cherie CPA @firm1040, Jul 15, 2017
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  3. Alvaro Aicardi

    AGH the CPA

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    What it sounds like you are trying to do is claim 100% of your expenses against your income? Thats simply not going to happen as there are many things you pay for that are not deductible. There are even some things you pay for for business that are only 50% deductible (ie meals)

    also, FWIW, You will never get to keep 100% of what you net. The US tax code simply doesnt work that way. Most people do pay approx 20-40% of their pay in taxes. Thats what covers your military, your schools, your infrastructure and of course the US debt payments.

    Bottom line, you need to see a CPA with all your information so they can help you reduce your net tax exposure and give you some guidance about what the best structure for your work would be.
     
    AGH the CPA, Jul 17, 2017
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