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Small Business Tax Questions: How to Get Answers

April 16, 2019
Small Business

As a small business, you probably have many tax questions. Even though you have already filed for your company, you now have to prepare for the 2019 year. You can talk to your lawyer with these questions, or you can ask a tax professional like a CPA. Here are some common questions we get from small businesses.

What Are the Deadlines to Make Quarterly, Estimated Payments?

If you are self-employed, along with filing annually, you may be required to file quarterly estimated payments. You are required to pay the self-employment Medicare and Social Security taxes as well as your personal income taxes. Your taxable business income can be calculated by estimating your total revenue for the year and subtracting any deductions or expenses. Once you have an estimate of taxable income, you’ll pay a portion each quarter of the year. So, if your business has a total revenue of $50,000 and you spend $10,000 in expenses, you have $40,000 in taxable income. You’ll divide that into four payments due at the end of each quarter. The 2019 deadlines are April 15, June 16, September 15, and January 15 of the following year.

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Do I Have to Pay Self-Employment Taxes if I Become an LLC?

The short answer: yes. Becoming an LLC is not a tax designation and as such does not automatically exempt you from self-employment taxes. As a sole proprietor or a partnership, you are still expected to pay the self-employment taxes. If you are a company that has more than one employee and makes around $20,000 per year or more, you could be a great candidate for an S-Corporation, which requires you to pay yourself a salary. In this case, only your salary would be subject to self-employment taxes.

Should I Be Utilizing Tax Deductions for My Small Business?

Absolutely. From the get-go, you may not think you have much to deduct from your revenue, but expenses can add up quickly. Think about everything you buy for your business; from the pens you write with to the software you use. Some of it is inexpensive, and you might not think it’s worth keeping track of. But the great thing is that a lot of little expenses can add up. Do you drive a lot for your business? You can deduct that. If you’ve paid for education for your business, you can deduct that as well. Utilizing a CPA to file your taxes will help you determine what’s deductible and what isn’t.

At Halon Tax, we know you have a lot of small business tax questions. That’s why our software comes with the backing of CPAs and customer support. We also link with QuickBooks Online so that all of your earnings and expenses are right at your fingertips. For more information about us, give us a call today at 612-293-8094.

Amy Schwende

Amy is a tax attorney with 10 years of public accounting experience. She has served a wide range of clients throughout her career with a focus on S corporations, partnerships, and their owners. In her free time she enjoys biking, reading, and spending time with her family.

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