If taxes were the first thing that came to mind when they first dreamed of opening their own business, many entrepreneurs probably wouldn't be in business today!
But there is help out there.
Business Taxes 101
First, many small business owners have to decide on what kind of company they will be 'filing as'.
Different business tax structures each have their advantages. However, many new business owners usually opt for the simpler sole proprietorship or general partnership structure before graduating to the alphabet soup of LLC, C corp or S corp entities.
The next step is filing for an EIN number with the IRS. The EIN (or Employer Identification
Number) is your permanent number and can be used immediately for opening a business bank account, applying for business licenses, and filing a tax return.
Then comes the the nitty gritty of profit and day-to-day expenses. And here is where many small business owners and independent contractors go slightly bonkers keeping track of income, outgo, related receipts and storing those pesky records in an orderly way.
If you're lucky enough to have someone on your team with bookkeeping experience or a knack for numbers, great. Provide small business software like Quicken or other finance management tools and assign the job to them.
More likely, you'll find small business accounting is usually best assigned to a CPA, especially as your small business begins to grow.
The good news? Business deductions!
Despite the headaches of keeping your books, the IRS is very generous when it comes to helping businesses grow, and will allow the small business owner to shave thousands of dollars a year off the costs of operation. These include initial start up costs, promotion and advertising, travel and transportation, health care, office equipment, education, and more.
the Web, find more information and helpful resources on small business taxes with advice from the experts including tips and techniques on avoiding common mistakes, keeping the books and paying your small business taxes on time...
Small Business Taxes & Management-Find U.S. publications in a business library for a fee, but peruse
the rest of the comprehensive free resources available including
and links to related small business issues, IRS and tax info.
Business and Self-Employed Tax Center
- Get the inside scoop from the IRS on paying taxes on your small
business with online workshops, resources for self-employed and
independent contractors, plus detailed info on EIN numbers and
related forms and publications.
Business Owner's Toolkit - Tax Center - Advice
and detailed information and how to avoid the usual pitfalls when
paying payroll, U.S. federal, state and sales tax on your small
business, along with tips on taking the proper deductions.
Link | Tax and Payroll - Comprehensive info on UK business
issues including VAT, National Insurance, capital allowances,
business expenses, records and reporting, plus info on filing
business taxes online.
Tax Fact Sheets - User friendly, jargon-free guides to UK small
business concerns with overviews on starting up, incorporation,
capital gains, and more.