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Subject:  sole-proprietorship Date:  10/1/2000  2:21 PM
Author:  CoreyHaines Number:  1933 of 15032

I'm 27 and have started a sole-proprietorship alongside my day job. It is a computer consulting company, basically contracting with someone to do his technical work. I have a few people who do the work for me, and I pay them. So, from my simplistic point of view, I send an invoice, get paid, receive an invoice from my "subcontractor" and pay him/her. The company is set up as a sole-proprietorship (filing a schedule C at the end of the year), and I have a couple of questions with regards to taxes and transfers between the company's income and my personal expenses.

As the company becomes more and more profitable, I have the money sitting in a checking account. I would like to use that money for personal use, basically receiving "pay." I don't want to pay myself a wage, since it seems like that would double the taxes paid on this money. I've been thinking of starting an investment account for the company, I noticed that Ameritrade will let you start a sole-proprietorship account.

Or, can I simply take this as income for myself straight out, being taxed with the Schedule C, rather than the standard income tax?

My big problem is that I'm not even sure where to start looking for information about my current situation. If someone could point me to a place to start and a place to continue my learning.

-Corey Haines
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