U.S.A. Small Business Tax InformationA Handy Reference for U.S. BookkeepersUpdated to February, 2012The Bookkeeper's Notes on U.S. small business tax information ... everything in one place ... to use as a handy reference.You can scroll down to find what you are looking for or click on one of the QUICK LINKS to go right to the spot. You'll find small business tax information on U.S. self employment income, U.S. employee payroll taxes and the latest IRS news relevant to your business. Use this search feature to quickly find the information you're looking for.  Custom Search HI. I'm so glad you've come to visit bookkeeping-essentials.com today. :0)
Bookkeeping-essentials.com was designed to be a bookkeeping resource for work from home business owners like YOU. So please, feel free to snoop, peek and poke about. I really hope you like what you find and come back often. This page will change as I collect more information on small business tax information relating to the sole proprietor in the United States ... so I'm going to apologize in advance for those of you who don't like lots of changes. You can expect for the first while that I will rearrange the information until I get it in a format I like. I am not a U.S. tax professional. I am a Canadian citizen ... just learning about U.S. small business tax information. I recently took a U.S. online course on basic bookkeeping. I suggest you always double check my numbers to IRS publications (and with your accountant) as I may not fully understand the topic yet. If you see an error in the U.S. small business tax information section of this website, I would really appreciate it if you contacted me to let me know. Here's what I have so far. Notice to Site Visitor I developed this U.S. small business tax information page as a handy reference for myself. While I do my best to ensure it is accurate and complete, I make it available for your use with the understanding that I cannot be held liable for errors and/or omissions. Small business tax information is subject to frequent change and should NOT be confused with advice ... so professional advice should be sought prior to acting on any of this information. Please make yourself familiar with my site policies prior to relying on any of the information on this site. Quick Links to U.S. Small Business Tax InformationU.S. Calendar Deadlines
U.S. Self Employment Income
U.S. Employee Payroll Taxes
About IRS Due Dates and Late Charges
IRS Interest Rates
From the Bookkeeping Forums
Owning and operating a business in the United States means you have some legal responsibilities. Internal Revenue Service (IRS) requires regular reporting of employment taxes and business taxes. Each state has their own tax related requirements as well. These regulations are often referred to as government compliance requirements.
Tax compliance returns and payments should be filed on time. Failure to report and remit by due dates leads to costly penalties and interest charges. This site provides some U.S. (and Canadian) bookkeeping information you need to know to put more money in your pocket and avoid these charges.
Even if you can't pay the taxes owing, always file compliance returns by their due dates to avoid pricey penalty charges. Late filing or failure to file penalties for tax returns are 5% of the tax owing each month to a maximum of 25%. Interest charges on the balance owing will still apply along with a late payment or a failure to pay penalty of one half of one percent per month to a maximum of 25%. Small Business Tax Information Source: IRS Publication 17> What if I made a mistake?> Penalties> Civil Penalties What is considered the "official" receipt date at the IRS? Every sole proprietor needs small business tax information about filing deadlines and due dates ... so you can avoid costly penalty and interest charges. So how does IRS determine their "official" deadline date? Here's what I found. Business compliance deposits and returns received after the due date will be considered on time if you can prove it was mailed in the U.S. on or before the due date. It must also have been properly addressed with sufficient postage. Monthly tax deposits of $20,000 or more must be received by IRS on or before the due date. If the due date falls on a weekend or a federal (not state) public holiday, then you have until the next business day. There are two exceptions to this rule for excise taxes: "For deposits of regular method taxes, if the due date is a Saturday, Sunday, or legal holiday, the due date is the immediately preceding day that is not a Saturday, Sunday, or legal holiday. Under the special September deposit rules, if the due date falls on a Saturday, the deposit is due on the preceding Friday. If the due date falls on a Sunday, the deposit is due on the following Monday. For more information see the Instructions for Form 720." IRS allows private delivery services by DHL Express, FedEx and UPS. Don't forget to request written proof of the mailing date. Private delivery services do not deliver to P.O. box addresses. Only the U.S. Postal Service delivers to an IRS P.O. box address. Bookkeeper's Handy Reference Source: IRS
Make sure you discuss your situation with a professional who can give you small business tax information tailored to your specific circumstances. Bookkeeper's Small Business Tax Information on ... Here are some links to economic and market data which may be useful small business tax information when putting together your business plan. Visit TD Wealth Management's Market Resource Center. You will find analysis of global economic performance with emphasis on North America provided by TD Economics. You'll also have access to a market snapshot, interest rate headlines and investment calculators. New York Times Markets Overview highlights U.S. and world markets, currencies, consumer rates ... to name a few. About.com has a good introductory article where you can learn about economic indicators entitled A Beginner's Guide to Economic Indicators. I was unable to find the U.S. equivalent of Canadian Business.com's nice concise summary of Economic Indicators. The Economist.com does have some Weekly Indicators: Economic and financial indicators. I'll keep looking for a concise U.S. small business tax information source for economic indicators. Trading Economics United States Stock Market Chart - Dow Jones Industrial Average gives you the monthly historical values over a two year period. They also have a banner of economic indicators quoting the interest rate, growth rate, inflation rate, jobless rate, exchange rate and more. I like the historical value chart because I can visually see trending. Here are links to two currency converters mentioned on the IRS website ... XE Currency Converter and World Currency Converter. You can pick which you prefer. Monitor Bank Rates.com monitors Savings Rates. You key in your zip code and it finds the best rates near you. Do you have a favorites Market Watch resource you use to help you prepare your business plan? Why not share it with other small business owners and bookkeepers in The Bookkeeping Forum - Favorite Bookkeeping Resources. Business financial calculators, websites, where to find U.S. federal budget information and the U.S. Internal Revenue Code (IRC) are all found in this forum. Bookkeeper's U.S. Small Business Tax Information for February 2012Source: IRS Tax Calendars - Publications 509 and 1518
*Due date is February 10th for filing Forms 940, 941, 944, 945 for the fourth quarter of 2011 if you timely deposited all required payments. **March 31 if filed electronically Small Business Tax Information Source: IRS Publication 15 Circular E Employer's Tax Guide and IRS Publication i941 Instructions for Form 941 - Employer’s QUARTERLY Federal Tax Return
Small Business Tax Information Deadline Footnotes In the week there is a federal (not state) public holiday, your Wednesday deposit date is delayed until the next business day. *EITC payments are reported and claimed on Form 1040 by the employee in 2011. **Employees who earn $20 or more in tips during a month must report them to their employer. Employees who do NOT report their tips to their employers will report them on Form 4137. Beginning in 2011, this will result in the employer receiving Notice 4520 from the IRS requesting payment of their share of FICA taxes on unreported tips. ***EPTS = Electronic Federal Tax Payment System see Publication 966 The Secure Way to Pay Your Federal Taxes. Business users can schedule payments up to 120 days in advance of the desired payment date. The IRS that the Treasury no longer maintains the Federal Tax Deposit Coupon (form 8190) system. It was discontinued on December 31, 2010. (Reference: IR-2010-02) Bookkeeper's U.S. Small Business Tax Information 2012 Tax SeasonSource: IRS Tax Calendars - Publications 509 and 1518
2011 PAST DUE Deadlines and Due DatesSource: IRS Tax Calendars - Publications 509 and 1518
Small Business Tax Information Deadline Footnotes Note 1 - If an employee claimed exemption from income tax withholding in 2010, the employee must file a new Form W-4 for 2011. They should use the IRS withholding calculator. If a new form was NOT submitted by the employee, the employer must begin income tax withholding. Note 2 - If you paid your estimated tax payment by January 15, you have until April 18 to file. Note 3 -You don't have to make the January personal tax estimated payment if you file your Form 1040 for 2010 and pay your tax by January 31, 2011. See IRS Publication 505 for more small business tax information on individual estimated tax payments. EPTS = Electronic Federal Tax Payment System see Publication 966 The Secure Way to Pay Your Federal Taxes. Business users can schedule payments up to 120 days in advance of the desired payment date. FICA = Federal Insurance Contributions Act; FITW = Federal Income Tax Withholding Over Payment of Taxes Interest Rates
Under Payment of Taxes Interest Rates
Taxpayers other than corporations - under and overpayment rate is the federal short-term rate plus 3% points. Corporations - underpayment rate is the federal short-term rate plus 3% points and the overpayment rate is the federal short-term rate plus 2% points. Large Corporations - underpayment rate is the federal short-term rate plus 5% points and the overpayment rate over $10,000 is the federal short-term rate plus 0.5% points. Source: IRS Newsroom Bookkeeper's Small Business Tax Information on ... AFRs are the IRS imputed interest rates. This small business tax information is useful as the rates are used for corporate loans to shareholders. They are also used for installment sales where a customer purchase is extended credit for more than 6 months ... and no interest rate was stated. Short term is 3 years or less, mid-term is over 3 years up to 9 years, and long-term is over 9 years. You can find an historical index of the AFR on the IRS at irs.gov/app/picklist/list/federalRates.html . The rates are usually available the 3rd or 4th week of the preceding month.
Click here for ALL February 2012 AFR
Introductory Course on U.S. Payroll $9.95 USD
Are you new to payroll bookkeeping? One type of small business tax information that you must keep up with if you have employees is payroll tax ... so are you wondering what U.S. employee payroll taxes are all about?The Bean Counter has a free online introductory payroll course. The introductory payroll course is available in e-book format as well for $9.95 ... or you can order a CD or paperbound book so you can work away from your computer. The course is designed for business owners who have no formal bookkeeping training or on the job experience. The Bean Counter's So You Want to Learn Bookkeeping! Payroll is broken into an introduction and 8 lessons. Here is the course outline as described on the website dwmbeancounter.com: The Introduction provides an overview of payroll, employees, and your requirements as a business. Lesson 1 Types Of Compensation discusses and explains that an employee's compensation includes not only direct payments (salary and wages) but also indirect benefits known as fringe benefits or "perks". Lesson 2 Types Of Deductions discusses and explains the different types of deductions that are taken from an employee's salary or wages such as social security, medicare, federal and state income tax, and other deductions such as health insurance and retirement plans. Lesson 3 Calculating Payroll uses a fictitious company called Mom's Secret Recipes to illustrate what calculations are needed and how to do them in order to correctly calculate and pay your employees. Lesson 4 Payroll Taxes and Withholdings discusses and reviews how an employer reports and deposits amounts deducted from their employees' wages and salaries and also how an employer is required to "match" amounts deducted for social security and medicare. Lesson 5 Payroll Records illustrates and discusses the records needed by employers to properly documents and record their employee's wages and salaries and deductions taken. Lesson 6 Self Employed reviews and explains what self employment tax is, who is required to pay this tax, and how to properly calculate, report, and deposit this tax. Lesson 7 Government Regulations presents a brief overview of the federal and state laws, rules, and regulations that you as a business owner or manager need to be aware of. Lesson 8 What You Should Know summarizes and reviews the major points covered in this tutorial. If there is some small business tax information you would like me to present and/or track ... or that you would find helpful, please contact me with your suggestion.
More U.S. Small Business Tax
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Once you have looked over the U.S. small business tax information found on this page, I invite you to get a cup of tea, take a few moments to relax ... and discover some of the informal chats on good bookkeeping practices to be found on this site.
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