How Do I Keep Track of All These Tax Deadlines?
If you own a business, particularly if it is a new business, you are probably concerned about how to track tax deadlines. Fortunately, the Internal Revenue Service has developed several methods to help with this very problem. First, though, you must know which taxes you are required to pay.
The tax and information return you must file depend on your business structure. There are four general types of business taxes: income, self-employment, employment, and excise.
Almost all businesses must file annual income tax returns. Partnerships are a bit different because they must file information returns. Although you may never have thought about it, you pay your individual income taxes as you earn your money. It is a pay-as-you-go system. The same is true for businesses paying Federal income taxes. Four times each year, businesses estimate the amount of taxes they owe and pay them. This is known as paying estimated taxes.
If your business is structured as a sole proprietorship, you must pay Social Security and Medicare tax. The Social Security tax earns points for you in the Social Security system, which provides retirement, disability, and other benefits later in life.
If you have employees, you must make certain contributions on their behalf: Social Security, Medicare, Federal unemployment (FUTA), and income tax withholding.
Certain businesses must also pay a Federal excise tax.
When Must I Pay?
There are two types of employment tax due dates: information returns and deposit dates. Tax deadlines generally fall on January 31, February 28, and March 31. Quarterly returns are due on January 31, April 30, July 31, and October 31.
The timing of deposits depends on the type of deposit and your deposit schedule. FUTA deposits are due on the last day of the month following the end of the applicable quarter. Your Federal income tax and employment taxes, however, are due either monthly or semiweekly, depending on the deposit schedule your business is required to use.
The Internal Revenue Service recognizes that Federal taxes are a quagmire for many people. For this reason, it has developed several tools to ease compliance.
If all you need is a quick reference for taxes and due dates, you can view the IRS’s online calendar, which allows you to filter and sort events. The calendar is also available for tablets and smartphones. Second, the IRS offers an RSS feed to send calendar reminders one or two weeks before relevant due dates. Third, you may download the IRS desktop calendar, which allows you to access tax events on your computer. This tool automatically updates new events when they are added by the IRS. Finally, you may subscribe to the IRS’s small business calendar. There, you can download tax events into your calendar. This option, however, does not allow you to edit the events manually. For general information, call our office today.
This article is a service of KCKW Law Firm. One of our primary services is to assist business owners in making the right legal and financial decisions so that they save money in the long-run and avoid the unnecessary costs of litigation. We advise our business clients on a whole host of issues, including guiding them through the right choice of business entity, location of business entity, start up agreements, intellectual property protection, employment structuring, insurance, financial and tax systems that you need to start your next business and succeed right out of the gate. Many of our business clients are on our membership program, where they save money for monthly legal counsel consultations. Call us today to schedule a time to get started!