The business end of your operation is the part almost everyone dislikes. It's more fun climbing trees than it is crunching numbers. Keep your business finances separate from your personal finances, separate checking accounts, everything. Learn to be meticulous about getting receipts for all supplies: rope, chainsaws and parts, fuel, oil, every single item you buy to operate your business. This includes envelopes, stamps, copier paper, ink for the copier, a million different things you have to purchase to keep your operation humming. Any permits, fees for business licenses, any regulatory expenses can also be deducted. Instead of keeping records of fuel/oil,and expenses for vehicles the tax authorities allow you take off X cents per mile if you use your personal vehicle for business. You'll just have to keep track of both to see which is most beneficial to you. Insurance on business vehicles, workman's comp payments, advertising expenses, referral fees, etc. are all expenses which lower your tax liability.
Your income is what you charge the customer for your services, the amount that comes in from sale of goods (if for instance you sell logs or firewood from the trees you remove. Sale of equipment you decide to liquidate is income, especially if you've depreciated that equipment. Set up a system to keep track of all these items, perhaps find someone to do this scutwork fror you. It is amazing how these small things in the end amount to a large amount, and that large amount (expenses) is subtracted from your income, which then gives you your net profit (or loss). Most new operations will see a net loss initially because start up expenses will exceed income for a time. It is also possible to carry a loss from one year over to the next year's net profit, thereby reducing that profit which causes you to pay less taxes. It's part of being in business, so learn to do it well. That'll keep you from getting those nastygrams from your new partner, the IRS-or if you do get the nastygram, you'll have the paperwork to back up your figures. Makes it a lot easier to sleep at night. Good luck!