hey it's patti scharf CPA and co-founder of catching clouds the leader in
e-commerce accounting today I want to talk about whether or not the 2018 tax
law changes effect when you can deduct your inventory I've been asked this
question over and over and over this year and I think there's a lot of
confusion around the topic in fact I've even talked to other CPAs and there are
mixed answers so I'm gonna give you my opinion and kind of walk you through the
my thought process and stuff and hopefully it will will help clear some
of the confusion okay but before we get started I want to say that I have done
taxes for years but I also have not done taxes in years so make sure that for
your own personal situation you go talk to your own tax adviser
okay so let's get started why do you even care about this like what's what's
the whole point of knowing when you deduct your inventory so let's say
you're selling online and use you sold a million dollars this year and this year
you also went and spent four hundred thousand dollars on product so you
bought a whole bunch of product you went online you sold it you might have some
left over chances are if you're selling that much you probably have some left
over so knowing how much you can deduct it means like if you can deduct the
whole thing then your taxable income is six hundred thousand dollars just for an
oversimplification for this example taxable income would be
six hundred thousand dollars if you can't deduct any of it your
taxable income is a million dollars so that four hundred thousand dollars of
income that you get taxed on is a pretty big deal
the other reason you want to know is when you have a good handle on how much
inventory you're able to deduct you can start paying attention to whether you're
making profit on your specific sales because you don't want to be in a
position where you are losing $1.00 per sale because you know you can't make
that up on volume it just like drowns you faster okay so so that's why you
care about when you can deduct your inventory so what is inventory and I
feel like you can't really talk about inventory without talking about cost of
goods sold those two go hand-in-hand inventory are those product purchases I
was just talking about so if you bought 400 thousand dollars worth of product
that becomes inventory it stays inventory until you sell it when you
sell it that's called writing it off it's called
expensing it it's called a deduction it is your expense so the four hundred
thousand dollars becomes cost of goods sold inventory and cost of goods sold
are seasaw amounts you spent four hundred thousand dollars no matter which
way you look at it but maybe you have three hundred thousand dollars still in
inventory and you sold a hundred thousand or maybe you sold three hundred
thousand and you still have a hundred thousand left in inventory these two
amounts always balance out and match the amount
that you spent in cash the next concept you need to know about us cash versus
accrual these are two different accounting methods I did a whole video
on how to determine cash versus accrual so go check that out if you aren't
familiar with it now let's go on to the 2018 tax law changes now the biggest
change and this is what has everybody kind of in an uproar is the gross
receipts test now what this is is it says hey here's what it used to be hey
if you have five million dollars in gross receipts so basically you've
collected five million dollars from your customers or more then you have to be
accrual basis which means you have to record everything on the accrual method
if you're under that if you're a small business you can use the cash method
it's easier you don't need to worry you're pretty look pretty little head
about it okay it was actually the limit was 1 million if you're an inventory
based retail business so there are a lot of people that were like right at that
million mark or just above and they were having to file using accrual based
method and they're kind of grumpy about it ok so what happened with the tax law
changes is that the limit got bumped up to 25 million dollars so that's a pretty
big jump and a lot of people who are right in between that million and 25
million when yeh now I can be cash basis and so everybody's thinking yay I can
now deduct my inventory when I buy it not as products are sold because I'm on
cash basis and so that's how that works the problem is in this in this new law
it says if you have non incidental materials and supplies so things that
aren't really your core product that you're selling maybe it's a sleeve that
you know you include for packaging or you know it's not really what the person
is what your customers buying it's just part of the fluff around it
that stuff yes you can deduct it or it says it follows the taxpayers method for
financial statement purposes so what does this mean
when I first heard this and people were like yeah I get to just deduct whatever
I want to when I buy it just in my gut it just doesn't feel right because the
nature of cost of goods sold is it is literally cost of goods that are sold so
if you don't sell the goods there's no cost related to them so I really in my
heart think that this change of threshold saying above this your accrual
basis and below at your cash basis has nothing to do with the amount that you
record as cost of goods sold basically your cost of goods sold just
has to match up with whatever method you're choosing for your income so if
you're reporting your income in 2018 the costs related to those sales needs to be
included in 2018 if you are reporting income in 2019 the costs related to that
income needs to be reported in 2019 you can't like mix and match that way it's
just not what the nature of cost of goods sold is in my opinion with that
said I asked a whole bunch of accounts because I heard a lot of sellers saying
oh well I talked to my CPA and they said yeah that's legit and I'm like okay well
I'm not signing your tax return so do whatever you feel comfortable with but I
just don't think it's right I've heard that there's going to be more
clarification coming on or maybe people are just hoping that there's gonna be
more clarification about this but I think there's some confusion out there
about when inventory can really be deducted I would argue that this these
new tax laws changed nothing and you just have to report your cost of goods
sold when the goods are reported as income others may have another opinion
if you have another opinion and a good argument why go ahead and leave a
comment down below I think this is an
interesting case and I think it's weird so I think it's worth discussing I like
to discuss weird things so I guess that's it I hope you found this video
helpful if you did please like comment and share if you haven't already please
subscribe and I'll catch you later
For more infomation >> Do the 2018 Tax Law Changes Affect When You Can Deduct Inventory? - Duration: 7:57.-------------------------------------------
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Bay Area Concert! - Duration: 17:30.
hey guys welcome back to my channel its Lakhneet and yes I look like complete
shit I just finished my econ final online and it's been finals week and I'm
breaking out and it's freaking horrible but I'm happy now I'm done with the
second final so I'm going to the G-Eazy concert tonight so I'm about to get you
know lit up in there oh my god did she just say that anyway so I'm gonna be
right back and just put some makeup on and look much better for y'all here
still doesn't have a Napoleon but it's okay anyways so now ped not just to go
meet up with places we're getting a concert
so we just got into the uber on our way to shoreline yes we're going that
minutes late but it's concert hasn't started yet but sure people have started
walking in I just took a picture of me yes we're
morning like to others I take about 20 minutes okay guys just got off the /
we're like three minutes late hello traffic shit some words
controversy started I guess we're not late so they needed my sister for
everything but it's okay
sorry mix Hogtown with Gatorade and it just really was
we're gonna get some more and she's gonna buy it from me so I just picked up
have some egos tequila this thing was 17 fucking dollars but I need to get drunk
so here we go
damn food
what the fuck
your friend yes
and all these rolling
you and your friend
who do not oppose every drop in niggas house power
not to the man of stairs
sometimes a banished
company estimate last
so happy to be home I've been waiting on this shit for an hour
so peeping here so the fuck out
are we partying tonight
that's precisely what I can't before call to be thought that was always the
plan let's go
I just took care of my friend
are you ready for legendary nights right
they must say
threesomes in my fancy I like that the new greedy wife he grabbed my dick I get
a bite back
hey party tonight Assessor but talk to me
I've been rapping for about 12 or 13 years junior boss and some shit like
this so forgive me if I get in my feelings I have some moments tonight
is the ring everybody on the way in the back way up
there NASA like this follow me
ladies if you took some time getting ready you look yourself when you can't
before you left for the concert tonight and you felt like that bitch like the
most beautiful should make some noise for yourselves ladies she deserves
everything at one it works he is full/queen everything I thought I need
you by my side shooters have my breath on saw as fall asleep and now they wake
up right ahead of it and I'm doing things I never did before
fuck being selfish I'm just trying to give you want I'm going out my waist
make some motherfucking noise for Jeezy
okay bashing it what that was saying I stay passionate wasn't blowing money I
was stocking I figured what the fuck I want to throw in like from practice to
pay attention this shit ain't happening by accident
listen I'll slacker big day planned solid no cracks in it
Gigi activity
right
take a break
money
Bay Area I love one from and I'm so fucking proud to represent our region
all around the fucking world I love you I love you I love you thank you for
being us tonight thank you for fucking women we share some losing
murder peas and last but not least make some motherfucking noise for yourselves
with nothing with
by some things I'm gonna get lost I'll be fine
-------------------------------------------
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Survive Said The Prophet - found & lost | Official Music Video - Duration: 3:09.
Words of fear slip out like anger
In spite of how I truly felt inside
Maybe all I wanted was to not be alone
with you by my side
These train of thoughts linger as darkness falls in time
In too deep Inside these streets aligned
It makes me wonder how I even got myself here
in the first place?
To find it, and lose it
Get lost in this moment
Fate somehow brings me hope inside my heart
Anger, happiness, and sadness
Won't mean a thing when
Fate somehow brings me hope inside my heart
Fate somehow brings me hope inside
Fate somehow brings me hope inside
Fate somehow brings me hope inside
Fate somehow gives me the reason
gives me the reason
Damned to live this fate alone
Feel so far away from home
To find it, and lose it
Get lost in this moment
Fate somehow brings me hope inside my heart
Anger, happiness, and sadness
Won't mean a thing when
Fate somehow brings me hope inside my heart
These train of thoughts linger as darkness falls in time
In too deep Inside these streets aligned
It makes me wonder how I even got myself here
in the first place?
To find it, and lose it
Get lost in this moment
Fate somehow brings me hope inside my heart
Anger, happiness, and sadness
Won't mean a thing when
Fate somehow brings me hope inside my heart
Inside my heart
Inside my heart
-------------------------------------------
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Do you guys love animes? :3
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Survive Said The Prophet - found & lost | Official Music Video - Duration: 3:09.Words of fear slip out like anger
In spite of how I truly felt inside
Maybe all I wanted was to not be alone
with you by my side
These train of thoughts linger as darkness falls in time
In too deep Inside these streets aligned
It makes me wonder how I even got myself here
in the first place?
To find it, and lose it
Get lost in this moment
Fate somehow brings me hope inside my heart
Anger, happiness, and sadness
Won't mean a thing when
Fate somehow brings me hope inside my heart
Fate somehow brings me hope inside
Fate somehow brings me hope inside
Fate somehow brings me hope inside
Fate somehow gives me the reason
gives me the reason
Damned to live this fate alone
Feel so far away from home
To find it, and lose it
Get lost in this moment
Fate somehow brings me hope inside my heart
Anger, happiness, and sadness
Won't mean a thing when
Fate somehow brings me hope inside my heart
These train of thoughts linger as darkness falls in time
In too deep Inside these streets aligned
It makes me wonder how I even got myself here
in the first place?
To find it, and lose it
Get lost in this moment
Fate somehow brings me hope inside my heart
Anger, happiness, and sadness
Won't mean a thing when
Fate somehow brings me hope inside my heart
Inside my heart
Inside my heart
-------------------------------------------
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【第５回】次男ユンの湯けむり自己紹介だよ（English Subtitles） - Duration: 2:10.
Whoa, hey!
I'm the second of the five Hinoki brothers, Yun!
So like, we've got more facial expressions now.
I'm gonna try a bunch of them out right now!
First... I'm gonna open my mouth!
Next is closing and opening my eyes...
Blink, blink
And hey, our hair moves now, too!
See?
Huh? You think it's cute?
Yay!
Well, I'd really like to be able to do more,
like move my hands around and stuff.
It'll be fun to see what we're able to do from now on.
Anyway... Boing!
Welcome to the Hinoki brothers' private studio!
I'm supposed to introduce myself in this episode.
So... Here are my general specs! (Yun Hinoki/21 Years Old/Second Son/AB Blood Type RH positive)
They're showing up, right? (Yun Hinoki/21 Years Old/Second Son/AB Blood Type RH positive)
Can you all see them? (Yun Hinoki/21 Years Old/Second Son/AB Blood Type RH positive)
Okay, let's move on!
We've asked my other brothers to talk about me for the next part.
Guess we'll go through in order?
First is... Oh! This one's from Ryoma ❤
"I always count on him for his help..."
"But... I don't know if it's actually true that he's popular with girls."
There are a lot of troubles that come with being a guy, as you can see.
So you're fine not knowing that, Ryoma.
Even brothers have their secrets from each other.
Anyway! Next is... Huh?! Kanata...?
"I don't care."
You don't care?
That's okay. I don't care about you, either.
Anyway,
that's it from the second Hinoki brother!
With a heart that's always full of sparkles and poison ♪
Everyone's cute and trendy angel, Yun ❤
Hey, why don't we warm up together?
-------------------------------------------
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