TAX QUESTIONS

[weetam]

My aunt rents a store at $700.00 per month in New Jersey. She operates this small store by herself. The store sells mainly prepared foods, candy and video rentals. She is currently collecting disability so does not file a personal tax return. The store is her only other means of income. Does she have to file income tax on the income collected from the store? She does keep any records, so does not know her profit at the end of each month. But, there is a profit. Also, she sells products, like prepared foods, that are taxed in New Jersey, but does not charge her customers tax. Must she include sales tax when she sells certain items? Thank you

 

[loku]

Income from store

Yes, she is required to keep records and file income tax returns on income from the store. She may or may not owe tax, depending on how much income she makes.
She is also required to collect sales tax from her customers and remit it to the state. If the state audits her, they will make her pay the sales tax she should have collected.