Filing taxes means reporting the money your business made or lost during the year to the IRS. Tax returns must be filed annually by both individuals and businesses.
Steps to File Small Business Taxes for the First Time
- Gather Financial Records
- Determine Tax Deductions
- File Correct Forms for Business Structure
- Meet Deadline
When starting a business, choose a business structure carefully as each has different tax liabilities. The structure needs to suit your business for easier tax filing.
Filing Requirements for Different Business Structures
- Sole Proprietorship: File Schedule C and Form 1040. Also, file Schedule SE.
- Partnerships: File Form 1065 if transactions qualify for deductions.
- C Corporation or S Corporation: Must file an income tax return unless exempt.
- Limited Liability Company (LLC): Filing rules vary based on tax status. File for expenses even with no income.
Understanding these requirements will help in accurately filing taxes and avoiding penalties for incorrect filings.