Federal Taxes

Learn more about keeping your business compliant with federal tax requirements.

  • Plan Estimated Tax Payments to Avoid Penalties

    America's tax system is "pay as you go." Although you may end up owing more on tax day, the taxes you are are supposed to be paid into the system over the course of the year. For wage income, this is done via wage withholding. For other income, this is done through estimated tax payments.

  • Home Office Deduction Can Convert Personal Expenses into Business Deductions

    The home office deduction can help you save money on your taxes if you regularly and exclusively use part of your home for business.

  • Tax Avoidance Is Legal; Tax Evasion Is Criminal

    Individuals and business owners often have more than one way to complete a taxable transaction. Tax planning evaluates various tax options to determine how to conduct business and personal transactions in order to reduce or eliminate your tax liability.

  • Tax Year and Accounting Method Choices Affect Your Tax Picture

    Your tax year affects your taxable income. All the income received or accrued within a single year is reported on that year's tax return, along with all the expenses paid or accrued, and the end of the year is the cut-off point for many tax-saving strategies.

  • Obtaining Your Business Identification Number

    It is essential that you clearly identify your business to the IRS by using the correct identification numbers and industry codes. Trouble finding the correct code to describe your business may mean you are operating more than one trade or business. This article discusses the use of various taxpayer identification numbers by businesses and tips for determining if you have more than one business for tax purposes.

  • Bonus Depreciation Rules Clarified for Luxury Autos

    The interaction between 100 percent bonus depreciation and the IRS's luxury automobile rules is complex, so the IRS is hoping to clear up any confusion.

  • S and C Corporations Create Different Tax Consequences

    An S corporation is a pass-through tax entity, while a C corporation is a completely separate taxpayer from its owners.

  • Sole Proprietorships, Partnerships and LLCs Are Commonly Used Entities

    Choosing the business structure that best meets your needs is a critical decision: you must consider both non-tax and tax ramifications. This article looks at three of the most popular choices: sole proprietorships, partnerships and limited liability companies.

  • Business Income Can Include Income Not Derived from Sales or Services

    Sole proprietors must distinguish between Schedule C business income and other types of income when filing tax returns.

  • How to Compute Business Income

    Computation of business income begins with reporting your gross receipts or sales. If your business makes or buys goods to sell and maintains an inventory, you're entitled to deduct the cost of goods sold from your revenues in computing your gross profit from your business. Valuation of inventory and identification of inventory items is important to accurately determine your income.

  • Properly Substantiated Meal and Entertainment Expenses Are Deductible

    As a small business owner, you may entertain clients or customers. While this is often a business necessity, the costs can really add up. You'll be glad to know that the IRS allows you to take a deduction for 50 percent of your qualifying business meal entertainment expenses.

  • Business Related Travel Expenses Are Deductible

    The category of travel expenses, one of the most commonly encountered types of business tax deductions, is discussed.

  • Start-up Costs and Organizational Expenses Are Deducted over 180 Months

    Expenses incurred in preparing to open a new business are deducted over 180 months, rather than all at once as they would be if the business were already operating. Typical costs include investigating whether to open a business, ordering supplies needed, and training employees.

  • Due Dates for Returns and Payments Depend upon Business Form

    Your filing and payment obligations and due dates generally are based on the legal form in which you operate your business: sole proprietorship, partnership; or limited liability company (LLC); C corporation or S corporation.

  • Monitor Your Tax Situation to Minimize AMT

    Because some taxpayers, particularly wealthy taxpayers, were so successful in legally minimizing their tax bills, Congress came up with another way to tax them: the alternative minimum tax (AMT). Unfortunately, the AMT now catches even "middle income" taxpayers in its net.

  • Understanding Federal Income Tax Obligations

    Every small business owner must have a basic understanding of federal income tax law. Knowing the law helps you avoid paying too much in taxes and protects you from the risk of paying too little.

  • Protect Yourself When Outsourcing Payroll

    Using a payroll service can reduce the aggravation associated with your employment tax responsibilities, but you remain responsible for ensuring that the obligations are actually met.

  • Tax Credits Commonly Available to Small Businesses

    Credits for providing health insurance, starting a retirement plan, providing child-care, improving access for the disabled, or providing work to disadvantaged individuals are among the credits that many small business owners may wish to explore.

  • Using Credits Can Reduce Your Tax Bill

    Once you have scoured your records for every available tax deduction, you need to be as diligent in chasing down any credit that you can claim. In addition to claiming all of the tax deductions that you can, you can further minimize your income tax bill by claiming all of the tax credits available to you.

  • Certain Employee Benefit Payments Are Tax Deductible

    You can generally deduct the cost of providing employee compensation and benefits as a business expense.

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