https://transparencyofadreamer.wordp...sing-in-amway/
Below are excerpts. The blog owner claims to have made a net gain due to a tax refund. He doesn't explain how he arrived at that refund but apparently his losses in Amway lowered his tax liability for whatever income tax was already withheld from either his paycheck (job) or from paying estimated taxes in advance for a business or some other venture. It's quite scary and illustrates how some people can hang on in Amway for so long even when suffering losses. The IBO's are programmed to "think" they actually made money!
Based on what they have taught me, even though I barely had any increase in my overall organization (ie: I was pathetically lazy, didn’t put any work in and barely increased the size of organization – #sadface) I STILL DID NOT LOSE MONEY!
2013 total Cost Run Down:
Communikate: $443.40
Digital Delivery: $300.00
Premier Membership: $599.40
Major Functions: $595.00
Major Function Hotels: $750.00
Business Support Materials: $240.00
Total Business Cost: $2927.80
Lets bring it all together here, folks.
Total Amway Payout in 2013: $2112.36
Total Cost To Run Business: -$2927.80
= $-815.44
Just like I said last year – “Oh No! I’ve been scammed! I’ve lost money! My upline lied to me! I didn’t put in any work to sponsor anyone this last year and its everyone’s fault but mine! The business doesn’t work! What a total scam!!!”
Hold on now Mr. Negative – Due to running my own business in a country that incentivises business owners to run their own business I received tax benefits that entitled me to a refund for the 2013 year in the amount of $2409.76. Lets do this again, shall we?
Total Amway Payout in 2013: $2112.36
Total Cost To Run Business: -$2927.80
Total Tax Refund For 2013: $2409.76
= $1594.32
So, as I wrap up I hope I made my point very clear – you will not lose money running your own Amway Business powered by World Wide Dreambuilders…. IF you are diligent with your finances, if you don’t blow your budget your coach sets with you. You WILL lose money running your own Amway Business powered by ANY training system IF you don’t have a budget, if you don’t ask for help to set a budget, if you ignore your budget etc.
If your potential sponsor is affiliated with WWDB and is doing what they are taught, you should be educated on some of the numbers I shared above in regards to cost for access to your training and mentorship system.
9 comments:
I was able to figure out how the $1594.32 was arrived at. Fuzzy Math.
This reminds me of the Earned Income Tax Credit the government has in place for "the working poor" so they don't have to pay any income tax. Trouble is the "Amway Earned Income Tax Credit" is not anywhere in the Tax Code and sends red flags to IRS auditors!
For the last time, a tax refund = a loss! If you make 10,000/yr. with a 15% tax base, you would ow e $1,500 in taxes (if there are no expenses to be used as deductions.)
If you make that same $10,000 and incur $300 in expenses, THIS is how it breaks down: 10,000 - 300 = 9,700. $,9,700 x 15% tax base = 1,455 owed to the government - a difference of $45. You paid $45 less in taxes, but it cost you $300 in expenses to recover that $45. You, Sir are the loser to the tune of $255. Way to go!
And for the record, your 'payout' from Amway came as a result of orders from you and/or downline. It cost you far more than 2112.36 in products to fulfill the Personal Use part of C.O.R.E. You simply got a rebate. A rebate is not income, it is simply money you paid out and they are returning to you.
You may have a paltry income from retailing (another part of C.O.R.E.). How's that home-delivery working? On-line, you say? I'll just bet they are overwhelming your ordering site to get the products, right? You can barely keep up.
One would be better off taking those discretionary dollars and making small investments with a 401(k). Even a CD guarantees the principal. You won't make much but you won't go backwards. How nice it would be to have those CDs in an emergency instead of trying to borrow from you upline who is broke.
I know that many IBO's are taught to blame themselves for failure or not working hard enough. But if this IBO is truthful about not even making an effort, then he is not entitled to any business deductions as he was simply running a hobby business. Why should taxpayers foot the bill for his functions and other training materials?
Not to mention unbillable hours which are countless. That's the dirty little secret.
Im thinking about quitting amway, but at the time, I don't want to disappoint my friend, and he is also and ibo.
Ultimately, the decision is yours to make but it should be made based on YOUR business, not your friends. If you are losing money, you need to make the decision based on how your business is performing. Good luck in whatever you decide.
If you don't have the guts to quit cold turkey, you can ease into it by stopping all expenses: no tools, no functions, only buy the Amway products that you want. Your friend is not getting a dime out of this unless he is a Platinum, so it won't impact his income. When your membership is up for renewal, just let it lapse.
-- AnonTB
Let me add that a good way to flag an audit is to generate a loss on your side business, so that it lowers the taxes you pay on your day job. And, if audited, most Amway deductions won't pass. Tools, functions and most meetings are considered motivational or social, and don't meet the IRS criteria for deductible training. If you're unlucky and get audited, you're in for a world of hurt with penalties and interest.
-- AnonTB
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