Taxes and Stuff for a New Small Business
And how actually reading through the IRS website isn't so bad after all...
Well, here's what I've done.
I looked up "The Tax Club" on BBB, and it was a no go. I should have done that in the first place.
Next, I took a deep breath, and dedicated about 5 hours to reading through the IRS website (small-business section). It can be complicated, but if you just skip what's not pertinent to your situation, the volume lightens up a LOT.
I found a lot of answers, all that I was looking for at the time (I was freaking out if I had to pay or do anything quarterly), and I also know where I can go to find more answers if and when I need them.
http://www.irs.gov/businesses/small/index.html
Basically, since I'm a single-owner LLC (with no employees) and don't make "big money" yet, I don't have to report or do anything until year-end tax time.
In a nutshell, just keep track of everything... EVERYTHING. And keep your personal and business finances completely separate.
I've decided I'll fork out the $99 for Quicken (accounting software that will help me keep track of everything), and use it's tax integration with TurboTax at the end of the year.
I've also considered using GnuCash (an open source accounting suite) because I am a BIG believer in open source software.
And yes, good luck indeed! lol ;)
Update: Jan 2008
Okay, I'm getting all kinds of nutty forms in the mail. I honestly try and read through them and it's ridiculous. For instance, form 941... should be straightforward, it's NOT. It's so abstract and hard to understand I'm going to have to CALL the IRS tomorrow to find out what I need to do...
Fortunately, they have wonderful contact information for me :)
YAY! -.-
Also, GnuCash is absolutely wonderful! Got a chance to really try it out and it's very efficient, I love it! http://www.gnucash.org/
Update Jan 23, 2008
WOW! I called, was on hold for about 5 min, and the agent was extremely polite and very helpful.
I had questions about form 940 and 941 (I received them in the mail, and do I need to fill them out even though I don't have employees?) and she (Ms. Ross, agent #2915204) said to disregard those forms if I have no employees.
She said to treat my business as a Sole Proprietorship, and that I only needed to submit those types of forms (1040, Schedule C, Schedule SE, etc.) by April 15th!
Ahhh, makes my life a little easier. I can probably even just use HR Block online! lol
Anyway, here's the list of Sole Proprietorship Forms.
Update April 12th, 2008
How to File Taxes for a Sole-Member LLC
So yeah... I didn't know if I needed to file my LLC separately, or just put it all on my own personal Schedule C or WHAT! After looking around, I found the answer, and here it is:
Are you the only member of your LLC?
If you are a sole proprietor who formed an LLC, yourself being the only member, you do not need to file Form 1065 for your LLC.
You can simply file Schedule C with your Form 1040 and include all LLC income and deductions there.
It is also important to know that this doesn't affect the liability limitation of your LLC. The way your business is taxed has nothing to do with liability. (YAY!)
Obviously, make sure to get all your expenses and such in there! Like: office supplies, fees, equipment, office rental costs, gas mileage!, etc.
I am so glad that I started my LLC, because after owning and operating it for almost a year, it becomes obvious that the business type was created for the lone entrepreneur like me, because evertime something like this comes up, the answer is better than I thought it would be. :)
Oh, and by the way, I just used HR Block Online and it was very convenient and simple. I was able to do my personal and business taxes in the same go since I'm a single member LLC. Also, as sort of a note for myself, using it next year as well will be the way to go since they can pull ALL the data from this year... including (I am hoping) the amortized/depreciating crap like my new computer. :P
