Thanks, MDM!! Answers below...
- Is the $800 "per month" or "total"? I'm guessing "per month" for the purpose of commenting.
Per month, yes.
- If you are running a business and intend to file taxes accordingly, you should have receipts for all expenses (or at least for amounts required by the IRS).
I do print receipts for all expenses for annual tax reporting, yes. (I simply prefer to go through the pain once per year, printing all receipts from each company in one go, vs doing the entire process monthly for one receipt each.)
Although, I agree with mlipps that once you can show <$800 profit for a given month you don't need to justify less profit for the purposes of the subsidy program.
Excellent news!
Seems you could say "...business income profit over $800 per month reduces the subsidy dollar-for-dollar" - is that correct?
My brain gets stuck when I ponder this. In think it
might be correct, but my brain isn't quite grasping if it's the case. Your rephrase might be successfully touching on the essence of my primary question.
It appears you are in a program that gives you some ongoing (monthly?) subsidy.
Yes. (Well, it says it will. Whether it actually does or not is hit or miss from month to month, which is a large part of why I want to keep my time-and-stress investment as low as possible.)
The sentence "The maximum that can be set aside (saved from the net income for the business's future) is $5000, then we are booted off the program." If you had, say, $100,000 profit it makes sense that you wouldn't need a subsidy. What happens, however, if you have $750 profit each month ($9,000/yr)? Do you continue to get the subsidy because you never use any "set aside"?
Yes. If my total profit is consistently less than $800/mo, such that I can't even make use of the set aside, I could continue receiving the subsidy indefinitely.
As it stands, my monthly profit over the years has been anywhere from $0-$3000/mo, depending on what's happening in each project and overall. It was at $0/mo for a good while, and has been hovering right around $800/mo lately. Through the lens of the CRA (Canadian version of IRS), there has actually been no profit at all for two years, due to a business disaster, but the subsidy program only looks at the most recent month, and does not entertain the bigger picture, tax perspectives, loan repayments, Corporation-specific costs, etc. Just what bare necessities were needed in the last month in order to bring in last month's income -the calculation can include only those. So, it's very skewed in any case, which makes it harder for me to understand and report to. I have to have an entirely different understanding/headspace to prepare each report, which is challenging for me.