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I cannot find it now, but there was recently a man who lied on his credit card applications about his income. I believe he ended up not being able to pay and that is when they found out that he was lying about how much he made. They sued and now he faces jail time. If I can find it I will post the link.
I understate income when I apply. As a young person I reckon they would think I am lying and ask to submit tax returns, banks statemtents, or some other documentation. I did it for American Express because it was simple, but I would not want to do it for everyone. I do not think lying is that bad though. There are people who make over 100,000 a year but end up filing for bankruptcy or becoming seriously deliquent. There are people who may only make 20,000 a year and are denied because their income is too little, but this person only spends what they have and would never think about filing bankruptcy.
I just pulled up an app for a chase slate for reference, they ask for "gross annual income"
While it is not defined anywhere I know of on the app, I think using the IRS definition will certainly be safe, which is basically whatever is on line 22 of your 1040 is defined as gross annual income. So anyone unsure could use that as a safe figure. If that figure drastically misrepresents what you feel you make, then I would think a manual adjustment from you could be in order. For most people it's pretty close. '
I seriously doubt a CCC is concerned about being 10% off on income.
@android01 wrote:It all depends really. I have an S-Corp where my reported income can vary wildly. In 2011 my reported 1040 income was $217,000. in 2010 it was $95,000. I take an annual salary of $50,000 (w-2) and rely on how well I conduct my business to determine if I keep any of my profits or reinvest them (depreciable assets) in my business. So my taxable incme varies greatly. 2012 is going to be close to $400,000, which unless I buy depreciable equipment, and if I don't, is going to cost me a tax bill that I can't by any means afford to pay. I am a perfect example of how success is penalized in this country.
So what figure do I use for applying for credit cards? $100,000. I'm going to need to apply for a few more just to pay the tax bill this year. How bad does it suck to borrow money to pay your tax bill after kicking butt all year to better myself? I don't want this to turn into a political discussion - please. Let's just say that I am very wary of this econimic cliff that's going to happen at the beginning of the year.
I've seen that happen in rapidly growing profitable companies that use accrual accounting. The IRS considers recievables (stuff you have sold and billed but haven't been paid for yet) as income. You wind up either raising prices in order to choke sales, or factoring (yech) to pay the MAN. In our case we wound up raising equity to pay the taxes. Worse problems to have.
EtoA: We had a classic C corp so the after tax income went into retained earnings funding inventory, equipment, tooling and such though recievables was the largest chunk.
@CS800 wrote:Never start something that could jeopardize your relationship with ANY creditor. You never know down the line you might need the small creditor again.
That said we do have some members with baller status on here
DaveSig, RockinRay, Big Daddy, Bibro and Crashem lol
Sorry if i missed some
Hey.. What about me???? Oh yeah,, I'm poor... Forget I said anything.
@cashnocredit wrote:
@android01 wrote:It all depends really. I have an S-Corp where my reported income can vary wildly. In 2011 my reported 1040 income was $217,000. in 2010 it was $95,000. I take an annual salary of $50,000 (w-2) and rely on how well I conduct my business to determine if I keep any of my profits or reinvest them (depreciable assets) in my business. So my taxable incme varies greatly. 2012 is going to be close to $400,000, which unless I buy depreciable equipment, and if I don't, is going to cost me a tax bill that I can't by any means afford to pay. I am a perfect example of how success is penalized in this country.
So what figure do I use for applying for credit cards? $100,000. I'm going to need to apply for a few more just to pay the tax bill this year. How bad does it suck to borrow money to pay your tax bill after kicking butt all year to better myself? I don't want this to turn into a political discussion - please. Let's just say that I am very wary of this econimic cliff that's going to happen at the beginning of the year.
I've seen that happen in rapidly growing profitable companies that use accrual accounting. The IRS considers recievables (stuff you have sold and billed but haven't been paid for yet) as income. You wind up either raising prices in order to choke sales, or factoring (yech) to pay the MAN. In our case we wound up raising equity to pay the taxes. Worse problems to have.
EtoA: We had a classic C corp so the after tax income went into retained earnings funding inventory, equipment, tooling and such though recievables was the largest chunk.
We are seriously changing to to a C-Corp. We're getting killed as an S-Corp.
@android01 wrote:
@cashnocredit wrote:
@android01 wrote:It all depends really. I have an S-Corp where my reported income can vary wildly. In 2011 my reported 1040 income was $217,000. in 2010 it was $95,000. I take an annual salary of $50,000 (w-2) and rely on how well I conduct my business to determine if I keep any of my profits or reinvest them (depreciable assets) in my business. So my taxable incme varies greatly. 2012 is going to be close to $400,000, which unless I buy depreciable equipment, and if I don't, is going to cost me a tax bill that I can't by any means afford to pay. I am a perfect example of how success is penalized in this country.
So what figure do I use for applying for credit cards? $100,000. I'm going to need to apply for a few more just to pay the tax bill this year. How bad does it suck to borrow money to pay your tax bill after kicking butt all year to better myself? I don't want this to turn into a political discussion - please. Let's just say that I am very wary of this econimic cliff that's going to happen at the beginning of the year.
I've seen that happen in rapidly growing profitable companies that use accrual accounting. The IRS considers recievables (stuff you have sold and billed but haven't been paid for yet) as income. You wind up either raising prices in order to choke sales, or factoring (yech) to pay the MAN. In our case we wound up raising equity to pay the taxes. Worse problems to have.
EtoA: We had a classic C corp so the after tax income went into retained earnings funding inventory, equipment, tooling and such though recievables was the largest chunk.
We are seriously changing to to a C-Corp. We're getting killed as an S-Corp.
We started that way and that made it much easier to raise equity when the growth required it. Got a Nolo Press book and did a DIY. Grew every year for over 20 years. Hired a lot of people and paid a lot of folks mortgages. Good times.
@Tommy5746 wrote:I think we have all done it.. at least a little bit... You know when your applying for that credit card you reallllly want.. and you want everything positive possible on your side.. Soy uo slightly exaggerate your income.. Lets say you make 30k a year.. maybe you put down 33k? How many of you guys have done this before?? How much do you add on? I dont think its that wrong! Just as long as you dont go crazy saying you make 90k a year when you only gross 20k
That is extremely insulting to assert that we all have lied about our income. I have never done it, I usually only state my base income and leave out the extra's.
I think you owe this community an apology,