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What forms do you file with the state and fed for business taxes
Posted on 2/17/24 at 6:50 pm
Posted on 2/17/24 at 6:50 pm
New to owning a business. Registered with state (Texas) and federal gov't. I started on Jan 1 so don't have to deal with taxes for awhile. What is filed with the governments to report income and decide tax burden? I've only done W-2 to this point in my life.
6
Posted on 2/17/24 at 7:03 pm to Thundercles
How is your business structured?
Posted on 2/17/24 at 9:32 pm to LSUFanHouston
Sole proprietorship
Posted on 2/17/24 at 10:28 pm to Thundercles
ID 10T form
Posted on 2/18/24 at 7:59 am to Thundercles
Sole proprietorship income/losses are directly attributable to you. It goes on your 1040 with a Schedule C. I don’t know what your business is, but consider forming a sole member LLC. It’ll be taxed the same way but you limit your personal liability by separating into an entity.
Posted on 2/18/24 at 4:29 pm to AllbyMyRelf
quote:
but you limit your personal liability by separating into an entity.
Possibly.
Won't protect him from his own personal negligence or actions.
If he punches customer in nose, he's liable regardless if he has an LLC.
Now if an employee of his LLC punches a customer, yes, he is protected.
Posted on 2/18/24 at 4:37 pm to texn
The question I'm really getting at is, how do I tell them how much money I made? I've always been W-2 so my company tells me and I tell the government who says "yeah that sounds right."
Now my income is going to include that and a combo of Shopify, Square payments, cash sales, and Paypal. Do I aggregrate all those numbers on a form and file and they say "you owe this much"?
Now my income is going to include that and a combo of Shopify, Square payments, cash sales, and Paypal. Do I aggregrate all those numbers on a form and file and they say "you owe this much"?
Posted on 2/18/24 at 6:07 pm to Thundercles
The income reporting goes on a Schedule C. If you expect to owe more than $1000 in taxes a year, you’re supposed to be paying estimated quarterly tax payments. Your tax calculation is calculated using the Schedule SE.
I have now exhausted my tax knowledge.
I have now exhausted my tax knowledge.
This post was edited on 2/18/24 at 6:24 pm
Posted on 2/18/24 at 6:09 pm to texn
quote:Usually when people talk about limiting liability, they’re not talking about intentional torts of an individual but about contractual damages or bankruptcy of the business.
Possibly. Won't protect him from his own personal negligence or actions. If he punches customer in nose, he's liable regardless if he has an LLC. Now if an employee of his LLC punches a customer, yes, he is protected.
Posted on 2/18/24 at 6:21 pm to Thundercles
quote:
he question I'm really getting at is, how do I tell them how much money I made? I've always been W-2 so my company tells me and I tell the government who says "yeah that sounds right." Now my income is going to include that and a combo of Shopify, Square payments, cash sales, and Paypal. Do I aggregrate all those numbers on a form and file and they say "you owe this much"?
I find it fascinating that you’re running a business but don’t know the answer to this question.
You’re probably not alone at all, but it’s still fascinating from the sidelines.
Posted on 2/18/24 at 9:34 pm to slackster
quote:
I find it fascinating that you’re running a business but don’t know the answer to this question.
I can't tell if this is a jab or an observation. It's not like this stuff is inherent knowledge or proactively taught. The biggest challenge I'm having is that the spread of information is so wide, it's hard to actually pin down what's right for me.
A business is also only a technical definition-- this is super small and a one man show that won't do much revenue this year most likely. Minimal consequences so put more energy into building, marketing and selling and would figure the rest out later.
Posted on 2/18/24 at 10:16 pm to Thundercles
quote:
I can't tell if this is a jab or an observation. It's not like this stuff is inherent knowledge or proactively taught. The biggest challenge I'm having is that the spread of information is so wide, it's hard to actually pin down what's right for me. A business is also only a technical definition-- this is super small and a one man show that won't do much revenue this year most likely. Minimal consequences so put more energy into building, marketing and selling and would figure the rest out later.
How will you tell whether or not you are making money (income over expenses)? That might be a start in the right direction.
Posted on 2/18/24 at 11:29 pm to Dead Mike
quote:
How will you tell whether or not you are making money (income over expenses)? That might be a start in the right direction.
I track the income and expenses. I know all the numbers and will continue to know the numbers. What I am asking is how does one functionally inform the government of this when the time is due, and how do I square it up with what they believe to be the numbers? Like I said, as a w-2 earner I just take the numbers given to me by employer and tell the government the info and they have the same info sent to them and as long as those are look right I'm good to go.
I do not know how this works when you are the one owning the numbers. Like what form, what do you submit alongside, what documents are they looking for. So I can at least see what people have filed before and can start to poke in the right direction.
The responses to this question are reinforcing my point of "the spread of information is so wide it's hard to actually pin down what's right for me."
Posted on 2/19/24 at 12:00 am to Thundercles
IRS Topic 407 - Business Income
This might be helpful, and straight from the horse’s mouth.
IRS Publication 334 - Tax Guide for Small Business
Much more in-depth, but it’s a comprehensive guide to small business taxation.
This might be helpful, and straight from the horse’s mouth.
IRS Publication 334 - Tax Guide for Small Business
Much more in-depth, but it’s a comprehensive guide to small business taxation.
Posted on 2/19/24 at 6:25 am to Thundercles
Based on the information you’ve provided, you will need to fill out a schedule c on your 1040.
Google it and you will see that it has places for you to report your gross receipts, cost of goods, business expenses, info on business use of a vehicle, etc. this will calculate your taxable net income from the business and then it should flow through to your 1040.
Texas does not have state income tax but still may require reporting business income. Your tax software should walk you through it.
Google it and you will see that it has places for you to report your gross receipts, cost of goods, business expenses, info on business use of a vehicle, etc. this will calculate your taxable net income from the business and then it should flow through to your 1040.
Texas does not have state income tax but still may require reporting business income. Your tax software should walk you through it.
Posted on 2/19/24 at 10:12 am to Thundercles
You are going to use Schedule C of the 1040 to report your busines revenues and expenses. That will result in a net income or loss. Then other forms may be necessary, soch as Schedule SE for self-employment tax, or Form 4562 for depreciation.
Additionally, depending on your business, you may have sales tax obligations for Texas. If you have employees, you will have employement tax obligations.
Texas does not have a state income tax and if you did not set up an LLC, you won't have a state margin tax filing.
The best thing you can do right now is keep good track of your revenue and expenses. Keep up with it. Get Quicbooks Online or Freshbooks or somethhing simiar. Don't wait until year end. All those programs can download from your bank account (you do have a seperate business bank account right??) to make this stuff easier to track.
When it is tax time, you may seriously want to consider hiring a CPA, considering the questions you are asking are very basic (I don't mean that as an insult... no one knows until they know, right?) I'm not sure if at first, do it yourself via Turbotax is the best option.
Additionally, depending on your business, you may have sales tax obligations for Texas. If you have employees, you will have employement tax obligations.
Texas does not have a state income tax and if you did not set up an LLC, you won't have a state margin tax filing.
The best thing you can do right now is keep good track of your revenue and expenses. Keep up with it. Get Quicbooks Online or Freshbooks or somethhing simiar. Don't wait until year end. All those programs can download from your bank account (you do have a seperate business bank account right??) to make this stuff easier to track.
When it is tax time, you may seriously want to consider hiring a CPA, considering the questions you are asking are very basic (I don't mean that as an insult... no one knows until they know, right?) I'm not sure if at first, do it yourself via Turbotax is the best option.
Posted on 2/20/24 at 8:32 pm to Thundercles
quote:
I can't tell if this is a jab or an observation. It's not like this stuff is inherent knowledge or proactively taught. The biggest challenge I'm having is that the spread of information is so wide, it's hard to actually pin down what's right for me. A business is also only a technical definition-- this is super small and a one man show that won't do much revenue this year most likely. Minimal consequences so put more energy into building, marketing and selling and would figure the rest out later.
An observation. You are probably among a majority of business owners. Tax code is complex plus people know their business, not taxes.
Still fascinating to me on the sidelines.
Posted on 2/20/24 at 10:20 pm to Thundercles
How big/small is the business? Your probably need a cpa. We had a book keeper doing our quickbooks when we were really small to cut down on expenses and then hired a cheap cpa. I’d suggest doing the same. For me it’s peace of mind that everything done properly.
Posted on 2/20/24 at 10:38 pm to Thundercles
LSUFanHouston may piggyback off of this if I misspeak (I’m not a tax guy), but all you have to file is your tax return based off of the information from your records. There will not be any other forms you need to send off with the returns like you would with your W2 (back when we mailed them off)
You should receive 1099s from the various sites you sell on, but those are for your records. They have filed their forms w the IRS already and have reported how much they paid you; IRS will reconcile all of the 1099s with what you report.
You should receive 1099s from the various sites you sell on, but those are for your records. They have filed their forms w the IRS already and have reported how much they paid you; IRS will reconcile all of the 1099s with what you report.
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