The majority of Direct Sales Reps in New York are paid in their own names, which requires them to report all income and expenses on Schedule C of their personal tax returns. We find that the majority of these Direct Sales Reps would benefit from setting up an S Corp or an LLC in order to operate their business at a lower tax rate, enjoy a lower risk of being audited, and protect their personal assets. The Personal Trainers & Fitness Instructors we work with save an average of $2,491 each year in tax while enjoying an audit risk that is approximately nine times lower than it was before they hired us.
Some other nuances in the Direct Sales Industry that require special accounting and tax treatment include Purchasing Samples, properly accounting for Inventory, properly classifying items purchased for Personal Use, Sales Tax Reporting, Commission Statement Analysis to ensure that you're maximizing your tax deductions, and payments to outside attorneys. Here at Michels & Hanley, we are intimately familiar with these elements and are equipped to help your direct sales business reduce their annual tax bills.
Some of the Direct Sales Reps we work for sell products for:
Contact us today to find out how we can help you and your Direct Sales Business.
Michael Hanley, CPA
Brian Michels, CPA