Tax Collection and Payments
It is a form of direct tax collected by the state government to fund public services and infrastructure development. The tax amount varies state to state based on income or salary. Employers deduct the tax from employee salaries and remit it to the state. Self-employed individuals pay the tax directly. The tax differs from income tax and applies in addition to it. Failure to pay can lead to penalties.
Sales Tax and Deductions
If you are a professional photographer, understand your sales tax obligations. Sales tax applies to the fees charged for services. Some states consider photography services taxable, others don’t.
Tax Planning and Payments
For more complex situations, like multiple income streams, consider talking to a professional. For quarterly estimated taxes, look at your business bank account for the last 3 months. Add up all income earned. Add up all expenses spent. Subtract. Take about 25% out. That’s your estimated quarterly tax payment. How much you should pay during the year depends on your situation. Paying too little can result in penalties; too much loans money to the government interest-free. Consult a CPA on managing payments.