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Tax time is always a busy time for many businesses. If you own a small business, it is possible that you can file your own business taxes without the help of a professional. There are many ways that you can do this whether you operate as a sole proprietorship or as an LLC. Depending on what you classify your business different tax forms will be needed to help you report your business expenses and income.
Gather all Records
Business tax filing will require you to gather all of your necessary business documents. Prior to even filling out any tax forms to report your income from your business, you should be sure to have all the documents in front of you that you are planning on reporting.
If you use a computer spreadsheet or other program to keep your transactions on record and organized throughout the year, it will be a lot easier for you to calculate your deductions and income versus trying to remember all sales that you made during the year. There are various tax programs that will allow you to import your business tax info directly onto your tax return.
Find the Correct Tax Forms
Before filing your business taxes you need to figure out the correct IRS tax forms that you need. You need to make sure that you report your earnings to the IRS and be sure to pay them. However, depending on the type of business you operate, the form you choose will vary.
Most small business owners use a sole proprietorship that allows them to report all business expenses and incomes on a Schedule C attachment to their personal income tax return. This means that if you operate your business as an LLC, and you are the sole owner of your business, you are allowed to attach Schedule C to your tax return. However, if you are a corporation or choose to treat your LLC as one, you must submit a separate corporate tax return on Form 1120.
Watch Out for Deadlines
Keep in mind that there are different deadline filing dates. For example, if you use a Schedule C form, there are no separate filing deadlines that apply. These forms are also subject to the same April 15 deadline as other taxes.
If you are using Form 1120 for your C-Corp, you must file it by the 15th day of the fourth month following the closing of the tax year. If you are using Form 1120S for an S-Corp, you will need to file it by the 15th day of the third month following the close of the tax year, which is March 15th for most taxpayers.
Overall, filing your own business taxes should be pretty simple since you can get additional help from different tax programs regarding the type of forms you will need and how to report your income accurately. Certain tax programs will even search over 500 tax deductions to get you every dollar you deserve.
