Where's the Money? - Preview
Mountains of money, canyons of cash. But where’s yours?
Too Broke To Owe the IRS?
Your business checking account is overdrawn. Payroll is due tomorrow. You feel flat, busted broke. But your accountant tells you that your business made a profit of $50,000 and you are going to owe thousands of dollars in taxes to the IRS.
How is this possible? Is your accountant crazy? Where’s the money your accountant says you made?
This is one of the most frequently asked questions I receive as an accountant. Some people are shocked into disbelief that they owe taxes to the IRS when there is no money in their bank account. Many people simplistically believe that the balance in the bank determines the amount of taxes they owe. This is completely false, and in this article I intend to answer this question for once and for all time. Read and learn so you can plan and act appropriately.
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