I have a small business that sells advertising. It is classified as a Single Member LLC.

My customers pay me by check every month and I deposit these funds into a Bank Account set up with TIN # of Business.

My question is this: At the end of the year do these customers send me and the IRS a 1099 (I am not a contractor). I am trying to find out what is sent to the IRS? I just want to know when I am doing my taxes if I need to match up all 1099 (if sent to me) for my income? Or do I just keep track of my income through QuickBooks and report this? I just wanted to make sure they match if the IRS is getting something from customers. If they are not getting anything, how do they know what my income is?

Just trying to understand.

Thanks in advance for the help.

Did you happen to find out how many years it is necessary to go back for past taxes?

Also, was interest applied and at what rate?

I’ve seen the application which list prior years going back 8 years. This seems far to many back years to be actually “required”. Any info regarding this?

This whole scenario is incredible and it makes me even happier I left that sick joke of a city. I haven’t lived in LA for years, and now they’ve sent me the letter saying I owe money for 2005-2007. I didn’t even make money in 2005 (like, literally didn’t get a single client for my freelance copywriting that year; all of the work I found was through temp agencies and I certainly did pay my LA taxes for those things) but they’re saying even if I show them I didn’t make any money, I at least owe 103 per year, the minimum amount due, which I would have been exempt from if I’d known I needed to apply to be exempt from it. (the fact that you have to go get a special license to be exempt if you don’t make enough money to actually pay the taxes suggests to me that the law was set up specifically to try to gouge poor people where possible…)

This was a side thing I did just every so often to make a few dollars while I worked my regular jobs in hell-A, and my income for those three years was maybe a few hundred bucks. In 2005 when I set up my website and spent money to try to get started, I thought it would be a potential career. It wasn’t, I moved on to a real job but left open the possibility of doing work on the side, and now the dying city is just grasping at straws. How is it that here in 2009 they can figure out how to let me know about my “obligations” to them as a “small business”, but they couldn’t back then?

Looks like I’m screwed since I missed the 2/28/09 deadline. It’s so absurd – I’m creating work and bringing in money from other countries into this city with a book celebrating the English language and the United States. Reward from city fathers? A tax on my almost non-existent profits. Great.

Definitely ask for a penalty waiver for 2007. As far as 2008, when you file your federal taxes, remember that you´ll be liable for paying a city tax for anything that shows up as a schedule C (or 1099) for last year. Your best bet is to go into the office knowing your 2008 info now and if you owe, pay for both years.

I think I had to pay a grand total of 200.00. I hated doing it, but it´s over now.

You can be cute and likeable all you want, but the bottom line is that they want their money. And sometimes the counter-intelligence can be snotty. If they don´t like you, they will give you false info. Talk to a manager and nicely ask for a one-time penalty waiver. That´s the best you can probably do. But, eh, now you know, right?

Thanks!