Tax Pro Plus: Small Business Tax Tips - Starting A Business

Plan ahead!

A business plan is an essential road map for business success. A well thought-out plan helps you to think objectively about the key elements of your business venture and prioritize your decision making. Following are some tax items you should consider when writing your business plan.

• Decide on a Business Structure. Are you starting this business by yourself or do you have a partnership? Should you be incorporated? Have you thought about becoming a limited liability company (LLC)? Your decision will affect the business’s future tax structure.

• Get a Tax ID. Not every business needs an employer identification number (EIN) from the IRS, but if you have employees, run a partnership or meet certain IRS criteria, you must obtain one. You also may be required to start paying estimated taxes.

• Register with Tax Authorities. Employment taxes, sales taxes and state income taxes are handled at the state-level. You’ll need to learn more about your state’s tax requirements and how to comply with them.

• Hiring Employees. When hiring employees, you’ll need to set up records for withholding taxes, reporting to federal and state governments, as well as verifying employee eligibility. You’ll also need to obtain workers’ compensation insurance and pay the required unemployment insurance taxes.

Meeting with your tax professional before developing a business plan is a great strategy on your part. A tax adviser can help you make the tough decisions that make the most sense for your business.

At Tax Pro Plus, we specialize in helping small businesses create a financial plan.  Call us if you have questions at 310-827-4829.