The
form of business you operate determines what taxes you must pay and how you pay
them. The following are the five general types of business taxes.
Income
Tax
All
businesses except partnerships must file an annual income tax
return. Partnerships file an information return. The form you use
depends on how your business is organized. Refer to Business Structures to
find out which returns you must file based on the business entity established.
The
federal income tax is a pay-as-you-go tax. You must pay the tax as you earn or
receive income during the year. An employee usually has income tax
withheld from his or her pay. If you do not pay your tax through
withholding, or do not pay enough tax that way, you might have to pay estimated
tax. If you are not required to make estimated tax payments, you may pay
any tax due when you file your return. For additional information refer to Publication 583.
Estimated
tax
Generally,
you must pay taxes on income, including self-employment tax (discussed next),
by making regular payments of estimated tax during the year. For additional
information, refer to Estimated Taxes.
Self-Employment
Tax
Self-employment
tax (SE tax) is a social security and Medicare tax primarily for individuals
who work for themselves. Your payments of SE tax contribute to your
coverage under the social security system. Social security coverage
provides you with retirement benefits, disability benefits, survivor benefits,
and hospital insurance (Medicare) benefits.
Generally,
you must pay SE tax and file Schedule SE (Form 1040) if either of the following
applies.
- If your net earnings from
self-employment were $400 or more.
- If you work for a church or a
qualified church-controlled organization (other than as a minister or
member of a religious order) that elected an exemption from social
security and Medicare taxes, you are subject to SE tax if you receive
$108.28 or more in wages from the church or organization.
Note: There
are special rules and exceptions for aliens,
fishing crew members, notary public, state or local government employees,
foreign government or international organization employees, etc. For additional
information, refer to Self-Employment Tax.
Employment
Taxes
When
you have employees, you as the employer have certain employment tax
responsibilities that you must pay and forms you must file. Employment
taxes include the following:
- Social security and Medicare taxes
- Federal income tax withholding
- Federal unemployment (FUTA) tax
For
additional information, refer to Employment Taxes for Small
Businesses.
Excise
Tax
This
section describes the excise taxes you may have to pay and the forms you have
to file if you do any of the following.
- Manufacture or sell certain
products.
- Operate certain kinds of
businesses.
- Use various kinds of equipment,
facilities, or products.
- Receive payment for certain
services.
Form
720 - The federal excise taxes reported on Form
720, consist of several broad categories of taxes, including the
following.
- Environmental taxes.
- Communications and air
transportation taxes.
- Fuel taxes.
- Tax on the first retail sale of
heavy trucks, trailers, and tractors.
- Manufacturers taxes on the sale or
use of a variety of different articles
Form
2290 - There is a federal excise tax on certain trucks, truck
tractors, and buses used on public highways. The tax applies to vehicles having
a taxable gross weight of 55,000 pounds or more. Report the tax on Form 2290. For additional information, see the instructions for Form 2290 .
Form
730 - If you are in the business of accepting wagers or
conducting a wagering pool or lottery, you may be liable for the federal excise
tax on wagering. Use Form
730, to figure the tax on the wagers you receive.
Form
11-C - Use Form 11-C, Occupational Tax and Registration
Return for Wagering, to register for any wagering activity and to pay the
federal occupational tax on wagering.
Excise
tax has several general excise tax programs. One of the major components
of the excise program is motor fuel. For additional information, refer to Excise Taxes.
Emergency, Evening
and Early Morning Appointments Available
For a Personal and Legally Privileged Consultation in our
New York City Offices call (212)
974-3435 Payroll
Taxes, Trust Fund Recovery Cases, Income and Sales Tax Controversies. We
negotiate Payment Plans, compromise Tax Debts, and resolve all Civil and
Criminal tax issues, including Innocent Spouse Relief and Separation of
Liability. Selig &
Associates provides the most aggressive Tax
Representation allowed by law.
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