The Guide to Small Business Tax
A Home Business Article Contributed by Izzat Youssif
What's Small Business Tax
small business tax is the government cut of your profit. Your small business business need to pay 16% of it's profit in taxes. You may ask why your small business tax is higher than your regular tax. If you work for somebody else then your tax will be close to 8% and your employer pays the other 8%, but you are the employer you pay the whole 16% for your business. Part of small business tax pays for your social security and Medicare.
You can only pay small business tax if you are a small business owner, but large companies pay a different type of tax. If you are still puzzled about small business tax and need to learn more simply call your local H&R; and they will explain it more in details.
What Can I Write off As a Small Business Tax Expense
If you hire employees, then you can write off their wages as a tax expense. Because wages are part of the things that you need to run your business. If you run a day care service than you can write off some of your rent for the area in your home that you use for your day care. If you use your car for your business then you can write off the cost of gas per miles used for business only.
If you use a phone line for your business then you write off the bill if all the calls are for your business only. Don't write off everything though. If you write off something that you don't use for your business then that will get you into problems with the IRS and you will get a lot of penalties so it's not a good idea. Like coffee or treats that you offer your customers or employees can't be written off because it doesn't involve your business. You need to be careful about what you write off.
If you get puzzled about anything and need to know whether or not to write off than take to the local H&R; block. They're tax professionals and can answer your questions easily.
When is My Small Business Tax Payment Due?
It's due every three month of the calendar year if your business is doing good, but it will be due at the end of a calenderer year if your business is doing alright. That's about January or February.
How to Keep Yourself from Getting into Tax Penalties
First record keeping is very important if you don't want get small business tax penalties. Keep track of everything that your business use such as your phone bill, your rent, and the car miles you paid for. If you keep track of all these things then your tax payment process will go smooth. Even if the IRS decide to look into any tax penalties, good record keeping will came very handy because they care a whole deal for evidence. Make sure you keep track of your payroll and how much you paid each employee.
