I’m starting with a small business building websites on the side. I have a part-time job that is flexible with hours and having extra days off without pay. I would like to know if I take the day off from work and work on my website. Can I pay myself when it comes to doing my taxes?

Thanks in advance,
Scotty13

Hello Scotty:

Couple things.

The IRS doesn't care if you were supposed to be working for somebody else when you paid yourself.

The next thing is the type of entity you've chosen to do your business as. If you DIDN'T form a corporation or any other entity, you are a "sole proprietor". Sole proprietor's are taxes on what they make after their expenses are paid. What is takes as salary have NOTHING to do with what taxes you'll owe because your salary is NOT a deductible expense. So it doesn't matter what you call the money you take home with you. In your books, you can call it a draw...

It'll all work out at the end of the year, if you keep your books right.

excon