A thorough awareness of your federal tax obligations is one of the main concerns of climbing the ladders of success if you are gearing up for a business start-up. Not only knowledge about income taxes but also, information about payroll taxes hold responsible to help you sustain the recent trends in business blizzards. Give an unwavering glance at the following five tips that you must mold into action if you are looking for a successful kick-start for your business.
Business Structure: Choosing your business type is of utmost importance when looking for the ideation of a brainstorm. Some common types include sole proprietorship, partnership and corporation. You may also decide to be honed as an S corporation or Limited Liability Company. You must report your business activities using the IRS forms which are precisely considerable for your business type.
Business Taxes:Income tax, self-employment tax, employment tax and excise tax constitute the four basic categories of taxes. The type of taxes your business pays varies according to the type of business start-up you are bracing up for. Payment of taxes are done in accordance with a general estimation of taxes.
Employer Identification Number: An EIN might be a must have for federal tax purposes. If you do need one, we are available to guide you through the online process of applying for it. You can always give us a call to get to know whether an EIN is an absolute necessity for your type of business set-up.
Accounting Method:An accounting method is a basic preset that keeps track of your income and expenses reporting. A consistent accounting method is to be used for any new business. The cash method and the accrual method are the two most commonly used methods. Under the cash method, you normally report income in the year that you receive it and deduct expenses in the year that you pay them. Under the accrual method, you generally report income in the year that you earn it and deduct expenses in the year that you incur them. These rules does hold steady even if you receive the income or bear the expenses in a future year.
Employee Health Care:The Small Business Health Care Tax Credit helps small businesses and tax-exempt organizations pay for health care coverage they offer their employees. A small employer is eligible for the credit if it has fewer than 25 employees who work full-time, or a combination of full-time and part-time. Beginning in 2014, the maximum credit is 50 percent of premiums paid for small business employers and 35 percent of premiums paid for small tax-exempt employers, such as charities.
For 2015 and after, employers employing at least a substantial number of employees (generally 50 full-time employees or a combination of full-time and part-time employees that is on the same scale as 50 full-time employees) will be subjected to the Employer Shared Responsibility provisions.
Have a business idea? Call us at once. We will help you connect the dots and get the bull charging. The more you hesitate the tighter you get a hug from the bear. Time to substantiate your ideas into an up and running, successful business house.