I have collected information here to assist you with the overall requirements by the IRS so that you can plan your business a little better. However, as we all know there will be adjustments to these points raised below from time to time and you would be best to confirm anything you read on this page with the relevant department. You can simply do this by the internet at http://www.irs.gov/ when you think you need to.

The first pointy I would like to raise is the type of business you are in – this will determine what taxes you must pay and how you pay them. Here are the four basic types of business taxes.

– Income Tax

– Self-Employment Tax

– Employment Taxes

– Excise Tax

Let's run through them –

1. Your Income Tax

Just about all businesses apart from partners must file an annual income tax return. You should note here that partners file an information return. The form you use to do this depends on how your business is organized.

The federal income tax is a pay-as-you-go tax. You must pay the tax as you earn your money or when you receive income through the year. In most cases, an employee usually has income tax withheld from his or her pay. Note – If you do not pay your tax throughholding, or do not pay enough tax, you may have to pay an estimated tax. If you are not required to make estimated tax payments, you will need to pay any tax that falls due when you file your return. For additional information refer to Publication 583, Starting a Business and Keeping Records at the IRS.

Tax For Those Who Are Self Employed

Self-employment tax often called SE tax, is a social security and Medicare tax primarily for individuals who are self employed. Payments of SE tax contribute to your coverage under the social security system. It is important to know that Social security provides retirement benefits, disability benefits, survivor benefits, and hospital insurance (Medicare) benefits.

You must pay SE tax and file Schedule SE (Form 1040) if either of the following applies.

1. Your net earnings from self-employment were $ 400 or more.

2. You had church employee income of $ 108.28 or more.

Your Employment Taxes

In relation to employees, you as the employer have a number of employment tax duties that you must pay and forms you must file. These include the following:

1. Social security and Medicare taxes

2. Federal income tax withholding

3. Federal unemployment (FUTA) tax

You can gain additional information at Employment Taxes for Small Businesses

Excise Tax

You will have excise taxes levied on you if your business does the following:

1. Manufacture or sell certain products.

2. Operate certain kinds of businesses.

3. Use various kinds of equipment, facilities, or products.

4. Receive payment for certain services.

Excise taxes can refer to activities, such as on wagering or on highway usage by trucks. Excise Tax has several general excise tax programs. One of the major components of the excise program is motor fuel. For more details, refer to Excise Taxes at the IRS.

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Source by Bill Darken