What is Self-Employment Tax? If you work for yourself, you’re required to pay a self-employment tax, which comprises Social Security and Medicare taxes. When you work for a business, your employer takes out 7.65% of your gross income to pay the federal government to fund Medicare and Social Security, while your employer pays the other […]
What is an S Corporation? When you’re a business owner, you can elect to have your entity be classified as an S corporation for federal tax purposes using Form 2553. An S corporation is a pass-through entity, which means your business does not pay income tax at a corporate level. Instead, you and your shareholders are […]
Schedule C determines whether your business income is a profit or a loss. Completing a Schedule C will require a lot of documentation, and it comprises several parts. You may learn that if you complete a Schedule C, it may also involve other tax forms. Here is what you should know about Schedule C (Form […]
First enacted in 1939 in the aftermath of the Great Depression, the Federal Unemployment Tax Act (FUTA) was established to support involuntarily unemployed individuals. Imposing an unemployment tax on employers, this federal law supports states that need additional money to pay out benefits to their residents. FUTA taxes are not withheld from employee wages but […]
Here are a few tax tips you might consider before the end of the year, which could potentially reduce your taxes when Uncle Sam comes knocking in April. Generally, you want to lower income and accelerate deductions now if you expect next year’s tax situation to be similar to this year’s. Not all of these […]
If you’re a small business owner, you may want to review your business tax situation well before December 31 to determine what strategies you can implement to minimize your tax liability this year. The general strategy of reducing income and accelerating deductions now is appropriate if you expect next year’s tax situation to be similar […]
