Those starting a new business can sometimes become overwhelmed with the complexities associated with business related tax issues. As such, here are some useful and simple tax tips for new businesses worth considering. Getting any business off to a good start often means knowing in advance what to expect with regard to tax obligations. For example, the business structure can have a big impact on overall taxation. From partnerships to proprietorships and corporations, there are many options available to business owners when it comes to structuring a business.
Working with an experienced CPA is often the best way to make the most logical and advantageous choice in this regard. In addition, there are four specific types of business taxes that must be considered when operating a business. This includes self-employment tax, income tax, employment tax and excise tax. The type of taxes that a business will ultimately pay may be determined by which type of business structure is chosen. Many business owners choose to pay taxes using an estimated tax payment option.
Employer Identification Number
Equally important is to secure an employer identification number when starting a business. This is important for federal tax purposes. Working with a CPA, a new business owner can acquire an employer identification number quickly and easily. Another important concern when establishing a new business is the type of accounting method that will be used. Two of the most common types of accounting methods in use today include the cash method and the accrual method. This is another instance where consulting with the CPA is often the best option when making this determination.
Coverage For Employees
Finally, employee health care is a key aspect of establishing a small business. There is something known as the small business health care tax credit that can assist small businesses when covering the expenses associated with health care coverage for employees. The specifics with regard to the small business health care tax credit should be discussed with a CPA to determine whether or not a business is eligible for this particular type of tax credit. Consider these simple and useful tax tips for new businesses when establishing a business. Early planning and preparation can go a long way in making the formation of a business easy, convenient and stress free. Contact Li, Friezen & Grossetta, CPAs, PC today to learn more about experienced Tucson CPA services.