Starting Your Business -
Financing
Small
Business Taxes In The US
By
Chris Simpson
Taxes are paid differently
when you own a small business than personal taxes. You may use different forms
and depending on how in depth you need to go, you may need to hire an accountant
to do them.
This article will show you
some of the different things that are required for small business taxes. Please
remember these are only meant to help you. If you have questions or want to make
sure you have done it correctly, please contact your local accountant or contact
the IRS.
When you work for yourself
you need to pay Social Security and Medicare taxes. This is called
self-employment tax. You can use a Form 1040 to help figure out how much you
need to pay. The government has set up percentages for Social Security and
Medicare. These rules and laws could change from year to year, so you will want
to make sure you go to irs gov to get the latest information.
You must use either a tax id
number or your social security number when you file these taxes. The government
will issue these if you do not have one or both of them.
You must pay self employment
taxes if you make over $400 in a year. If you make under $400 you don't have to
claim it on your taxes. This amount is your gross earnings. The taxes are based
off of the amount you earned for the year.
Some may think if you work
your business part-time that you don't have to claim it. This is a myth. You are
considered self employed if you make any amount of money whether you worked the
business full time or part time. If you do things for people or people purchase
things from you and you make money, you are self employed unless it was a one
time thing and you never do it again.
When you pay your taxes, you
can do it quarterly or yearly. If you make a large amount of money you should
consider filing quarterly. If you don't, or you can save diligently, you can put
an estimated amount in a savings account. When you file your taxes at the end of
the year, you will have that money and hopefully it will be enough to cover the
whole amount.
There are several types of
business structures that may change the way and the amount that you file for
taxes. It will also determine the form you will need to use when you file. There
is a sole proprietorship, partnerships, corporations, s corps, and limited
liability companies. There are websites that will help you determine which
structure is right for you. You may also want to contact an accountant or
attorney to help you with this determination.
Keeping receipts and all
important documents is another important thing with your business. You need to
keep receipts for every item purchased whether it was a tablet of paper or
advertising in a newspaper. These are items you will be able to add to the forms
and you will need the receipts as back up to the form.
When you are first starting
your home business, it's a good idea to decide how you are going to file your
taxes. Visiting a website like irs gov is one way to get all the information you
will need. Another way is to contact an accountant or lawyer. Paying taxes is a
must when you are self employed. Filing right from the beginning will be a
benefit to you in the long run.
About the Author:
Chris Simpson is dedicated
to helping people find honest and legitimate
work at home opportunities
and home based business ideas. Our website offers free articles and resources to
help those actively searching, to learn how to
earn extra money .
Article Source:
ArticleRich.com
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