<p>In today's fast-paced digital landscape, small businesses are turning to e-commerce platforms as an additional avenue for showcasing their products. Although traditional brick-and-mortar stores remain a popular choice for conducting business, launching an online store presents a more efficient and dynamic approach to reaching customers.</p><iframe width="560" height="315" src="https://www.youtube.com/embed/HwwA1GdJrbE?si=nvCLFxoDlX9GOoZm" title="YouTube video player" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen=""></iframe><p>Embracing the world of e-commerce not only offers numerous advantages over physical storefronts but also opens up new opportunities for small businesses to thrive.</p><p>In this article, we'll walk you through the six easy steps to establishing a successful online store for your growing business.</p><h2 class="wp-block-heading" id="h-1-develop-your-products">1. Develop Your Products</h2><p>Developing your product is the <a class="link" href="https://1800accountant.com/blog/how-to-start-a-small-business-step-4-product-development">most important part</a> of opening an online store and starting your small business. However, there are three things you’ll need to focus on before moving on to further steps in opening an online store.</p><h3 class="wp-block-heading" id="h-niche">Niche</h3><p>One of the most important ways to develop your product and small business is to build your niche. This will give you an edge, not only in the beginning stages of business development but as your small business grows.</p><p>To start an e-commerce business with an advantage, consider profitable niches to expand or open your small business online. If you haven’t chosen a niche market, consider opening an online store in <a class="link" href="https://www.thebalancesmb.com/best-selling-niches-to-make-money-online-4109702" target="_blank" rel="noreferrer noopener">these profitable niches</a>:</p><ul><li>Beauty treatments</li><li>Dating and relationships</li><li>Fitness and weight loss</li><li>Gadgets and technology</li><li>Health</li><li>Online content (coaching, courses, podcasts, etc.)</li><li>Personal finance</li><li>Pets</li><li>Self-Improvement</li><li>Wealth Building through investing</li></ul><p>You should also search for businesses to model yours after. You’ll want to replicate what they’re doing in their marketing and social media postings and work with other industry professionals.</p><h3 class="wp-block-heading" id="h-name">Business Name</h3><p>As you develop your small business, you’ll need a <a class="link" href="https://www.thebalancesmb.com/put-your-business-name-to-the-test-2294885" target="_blank" rel="noreferrer noopener">business name</a>. No matter what your business entity is, a business name will provide a brand and an identity.&nbsp;</p><p>When choosing your online store business name, you’ll want to keep a few things in mind, such as:&nbsp;</p><ul><li>The business names of your direct competitors</li><li>How your company differs from the competition</li><li>How your company will solve problems</li><li>The target audience for your online store and small business</li></ul><p>To make sure your business name is the right name, you’ll want to come up with a name that addresses the above issues. Then, you’ll test your company name by using five to seven potential company names. Some things to remember are that your online store name should:</p><ul><li>Be able to be read clearly and quickly</li><li>Be easy to pronounce</li><li>Express or imply a desirable message</li><li>Not contain negative words</li><li>Represent who you are and is authentic to your brand</li><li>Spark interest in employees and potential customers</li></ul><p>If you are unsure whether your business name is available, you can also use a business name generator. This can be a great option because it combines keywords with other words to create a business name.&nbsp;</p><p>You can also use some business name generators to see if domains are available, making this even better if you want both a business name and a domain name.</p><h3 class="wp-block-heading" id="h-marketing-angles">Marketing Angles</h3><p>Finally, as you develop your products, you’ll also want to <a class="link" href="https://www.entrepreneur.com/article/283832" target="_blank" rel="noreferrer noopener">develop marketing strategies</a> for your small business. There are several ways you can do this online:&nbsp;</p><ul><li>Contribute to industry-specific forums.</li><li>Create video content through YouTube.</li><li>Offer free products or free services to your customers.</li><li>Use press releases to provide essential company events or news.</li><li>Use social media to upload photos and videos.</li><li>Utilize e-mail marketing to engage and grow your customer base.</li></ul><h2 class="wp-block-heading" id="h-2-pick-a-domain-name">2. Pick a Domain Name</h2><p>If you don’t already have a website, you should pick <a class="link" href="https://www.sba.gov/business-guide/launch-your-business/choose-your-business-name#" target="_blank" rel="noreferrer noopener">a domain name</a>. Similar to your small business name it’s also vital to choose a domain name that resembles your small business brand and mission.</p><p>After you pick your domain name, you’ll want to register it. That way, only you can use it for as long as you own it. It’s also a great way to protect your brand and identity too.&nbsp;</p><p>If you can’t register your domain because someone else has your domain name, there are still options available. Your domain name doesn’t need to be the same as your:&nbsp;</p><ul><li>DBA (“doing business as” name)</li><li>Legal business name</li><li>Trademark name</li></ul><p>To register your domain name, you’ll work with a <a class="link" href="https://www.icann.org/en/accredited-registrars?filter-letter=a&sort-direction=asc&sort-param=name&page=1" target="_blank" rel="noreferrer noopener">registrar service</a>. Make sure you choose one that offers you the customer service and price that you want. Finally, you’ll need to renew your domain registration regularly.</p><h2 class="wp-block-heading" id="h-3-choose-an-e-commerce-solution">3. Choose an E-Commerce Platform</h2><p>E-commerce platforms provide small business owners with the opportunity to promote, market, and sell their products to both existing and potential customers.</p><p>With a multitude of e-commerce solutions available, selecting the ideal one for your small business can be challenging. If you're uncertain about the most suitable e-commerce platform for your specific needs, consider the following factors to help guide your decision-making process:</p><ul><li>Ease of use (to create and upload content)</li><li>Ease of use (as a business owner and as a consumer)</li><li>Fees</li><li>Point of sale systems</li></ul><p>Fees play a pivotal in determining the e-commerce solution you’ll use. Various fees for you to consider include listing fees, transaction charges, and percentage rates for each transaction. Additionally, most e-commerce solutions will also require a monthly subscription fee for their services.</p><h2 class="wp-block-heading" id="h-4-build-your-store">4. Build Your Store</h2><p>After choosing your e-commerce solution, now it’s time to build your store. The exact store you’ll create will vary because of the e-commerce solution selected. Some e-commerce solutions specialize in different industries, such as food services, grocery stores, and retail.</p><p>The e-commerce solution you choose may also play a role in a few elements of your online store, such as how the store integrates with other websites, the design of your online store, and the ease of searching through your store for products.</p><h2 class="wp-block-heading" id="h-5-accept-payments">5. Accept Payments</h2><p>You can accept payments from several payment options. Depending on your small business, how you accept payments may also vary. There may also be fees per transaction the e-commerce solution requires as well.</p><p>Fortunately, <a class="link" href="https://fitsmallbusiness.com/best-pos-system-software/" target="_blank" rel="noreferrer noopener">many POS systems</a> accept payments from in-store and online customers.</p><h2 class="wp-block-heading" id="h-6-market-and-grow-with-1-800accountant">6. Market and Grow&nbsp;with 1-800Accountant</h2><p>Starting an e-commerce business can be an excellent option for growing your small business. Launching an online store is a simple, powerful, and streamlined way to reap numerous advantages and drive growth.</p><p>As you scale and promote your small business, partnering with professionals can help alleviate unnecessary stress. Collaborate with a seasoned <a class="link" href="https://1800accountant.com/services/industry/ecommerce">e-commerce CPA</a> at 1-800Accountant to help nurture and propel your business to new heights.</p>

In today&#8217;s fast-paced digital landscape, small businesses are turning to e-commerce platforms as an additional avenue for showcasing their products. Although traditional brick-and-mortar stores remain a popular choice for conducting business, launching an online store presents a more efficient and dynamic approach to reaching customers. Embracing the world of e-commerce not only offers numerous advantages [&hellip;]

Starting an e-commerce business in 6 easy steps.

start-e-commerce-business

Starting an E-Commerce Business in 6 Easy Steps

<p><a class="link" href="https://1800accountant.com/blog/business-entity-llc">LLCs</a> are one of the most common business entities, and their members enjoy limited liability and other benefits, making them great business entities. However, LLCs can convert to C Corps to benefit their shareholders even more.&nbsp;</p>
<p>Tax consequences are worth considering before ending an LLC and <a class="link" href="https://1800accountant.com/blog/form-c-corp">beginning a C Corp</a>.&nbsp;When you convert an LLC to a C Corp, there are requirements worth knowing, too. Here’s what you should consider when converting from LLC to C Corp.</p>
<h2>What’s the Difference Between an LLC and a C Corp?</h2>
<p>C Corps and LLCs are two business entities <a class="link" href="https://www.forbes.com/advisor/business/llc-vs-c-corp/%23choosing_between_an_llc_and_a_c_corp_section">with significant differences</a> between them. C Corps and LLCs differ in their business structure, tax payment requirements, and tax structure:</p>
<div class="rte-table-container">
  <table>
    <thead>
      <tr class="table-data-container">
        <td></td>
        <td class="cell-0">LLCs</td>
        <td class="cell-0">C Corps</td>
      </tr>
    </thead>
    <tbody>
      <tr class="table-data-container">
        <td class="cell-0">Ability to Issue Stocks</td>
        <td>Unable to issue stocks</td>
        <td>Can issue multiple classes of stock</td>
      </tr>
      <tr class="table-data-container">
        <td class="cell-0">Tax Entity Type</td>
        <td>Pass-through entities, taxes pass through from the company to owners</td>
        <td>Not pass-through entities, shareholders pay corporate and personal income taxes (double taxation)</td>
      </tr>
      <tr class="table-data-container">
        <td class="cell-0">Tax Options for Members</td>
        <td>Members can choose to be taxed as a C Corp or S Corp</td>
        <td>Not applicable</td>
      </tr>
      <tr class="table-data-container">
        <td class="cell-0">Tax Payment Method</td>
        <td>Owners file and pay taxes on the LLC's profits on their personal tax returns, avoiding double taxation</td>
        <td>Double taxation occurs, with corporate taxes and shareholder taxes on dividends</td>
      </tr>
      <tr class="table-data-container">
        <td class="cell-0">Earnings Retention</td>
        <td>May not have easy earnings retention due to taxation on distribution shares</td>
        <td>Generally has easier earnings retention on dividends, which are taxed when distributed</td>
      </tr>
    </tbody>
  </table>
</div>
<h2>When Is It a Good Idea To Convert from an LLC to C Corp</h2>
<p>When you’re thinking of when to convert your LLC to a C Corp, it’s wise to focus on your company’s next steps. As your LLC experiences growth, you may feel compelled to convert it to a C Corp.</p>
<p>A few indicators will tell you when it's good timing to convert your LLC. It's a good idea to learn how to convert from LLC to C Corp when you’re seeking to:</p>
<ul>
  <li>Offer common stock to shareholders&nbsp;</li>
  <li>Offer limited liability for directors, employers, officers, and shareholders.</li>
  <li>Lower self-employment taxes</li>
  <li>Raise money from investors</li>
</ul>
<h2>What Do I Need To Do To Convert My LLC to a C Corp?</h2>
<p>You must follow several steps for an LLC to C Corp conversion. No matter how you convert your LLC to a C Corp, you'll need to do these things:</p>
<ul>
  <li>File Articles of Incorporation with your state's Secretary of State office.&nbsp;</li>
  <li>Draft bylaws for the new C Corp.</li>
  <li>Appoint a corporate board of directors.</li>
  <li>Elect officers.</li>
  <li>Hold an initial board meeting.&nbsp;</li>
  <li>Issue stock certificates.</li>
  <li>Obtain <a class="link" href="https://1800accountant.com/services/ein-tax-id-filing">a new EIN</a>.</li>
</ul>
<p>On top of these requirements, additional steps vary depending on how you choose to convert your LLC to a C Corp. Each way you can convert your LLC to a C Corp affects what you'll need to complete the conversion.&nbsp;</p>
<h2>The <a class="link" href="https://howtostartanllc.com/form-an-llc/can-you-switch-from-an-llc-to-a-corporation">three ways to convert</a> your LLC to a Corp&nbsp;</h2>
<ul>
  <li>Statutory conversion&nbsp;</li>
  <li>Statutory merger&nbsp;</li>
  <li>Non-statutory conversion</li>
</ul>
<h3>Statutory Conversion</h3>
<p>The first way to convert your LLC to a C Corp is by doing a statutory conversion. This option is new and not available in every state but is the fastest.&nbsp;</p>
<p>A statutory conversion comprises four steps, which are to:&nbsp;</p>
<ol>
  <li>Prepare a conversion plan.&nbsp;</li>
  <li>Approve a conversion plan.</li>
  <li>File a certificate of conversion.</li>
  <li>File forms with the Secretary of State.&nbsp;</li>
</ol>
<p>Statutory conversions are unique because this transfer offers valuable features for LLC owners. By converting your LLC to a C Corp through a statutory conversion:</p>
<ul>
  <li>The transfer of all of your LLC’s assets and liabilities happens automatically.</li>
  <li>Your LLC members will automatically convert to C Corp shareholders.</li>
  <li>You won’t have to do additional actions for statutory conversions, which are requirements for other conversion methods.</li>
</ul>
<h3>Statutory Merger</h3>
<p>A statutory merger is the second way you can convert your LLC to a C Corp. This process comprises five steps, and it may be best for LLC owners in states which don’t offer statutory conversions.</p>
<p>To do a statutory merger, you’ll need to:&nbsp;</p>
<ol>
  <li>Form a new corporation that’s separate from your LLC.</li>
  <li>Have your LLC members approve a merger of the current LLC and the new C Corp.</li>
  <li>Have your LLC members exchange their membership rights for C Corp shares.</li>
  <li>File a certificate of merger and any additional required state paperwork.</li>
  <li>Dissolve your LLC.</li>
</ol>
<p>Similar to statutory conversions, statutory mergers allow your LLC assets and liabilities to transfer automatically to your C Corp.</p>
<p>The last way to convert your LLC to a C Corp is by doing a non-statutory conversion. This option may be the most difficult for some LLCs, and it may be the most pricey option too.&nbsp;</p>
<h3>Non-Statutory Conversion</h3>
<p>To do a non-statutory conversion, you’ll need to:&nbsp;</p>
<ol>
  <li>Form a new corporation.</li>
  <li>Transfer assets, liabilities, and ownership interests with separate LLC and C Corp agreements.</li>
  <li>Dissolve your LLC.</li>
</ol>
<h2>3 Tax Consequences of Converting LLC to a C Corporation</h2>
<p><a class="link" href="https://www.fortenberrylaw.com/convert-llc-to-corporation/">Three tax consequences</a> of converting LLC to C Corp apply for newly formed C Corps.</p>
<h3>Lose your pass-through status</h3>
<p>Your new C Corp's tax status is the first tax consequence worth knowing. When you convert your LLC to a C Corp, it will lose its pass-through taxation status, and this will cause your newly formed C Corp to experience double taxation.&nbsp;</p>
<h3>Changes in Taxation</h3>
<p>The second tax consequence will result from your LLC conversion to a C Corp:&nbsp;</p>
<ul>
  <li>As a C Corp, your company and your shareholders will experience taxation.&nbsp;</li>
  <li>Your new C Corp will be taxed on its annual profits first.&nbsp;</li>
  <li>After the company pays its dividends to shareholders, shareholders pay a second tax.</li>
</ul>
<h3>May be taxable for LLCs</h3>
<p>Finally, the conversion of an LLC into a C Corp may be taxable for some LLCs:</p>
<ul>
  <li>This can occur in LLCs that spend money borrowed and then deduct the money spent as expenses.&nbsp;</li>
  <li>As a result, LLC members may experience an income gain based on LLC profits caused by the conversion.</li>
  <li>You'll want to work with an experienced accountant to avoid this unintentional tax issue.</li>
</ul>
<h2>Work with Accounting Professionals To Ensure a Smooth Transition</h2>
<p>Transitioning from an LLC to a C Corp can be complex, filled with many steps and potential tax issues. Each method of conversion, whether it's statutory conversion, statutory merger, or non-statutory conversion, comes with its own set of challenges and nuances.</p>
<p>The experts at <a class="link" href="https://1800accountant.com/">1-800Accountant</a> can simplify this process. Our team of <a class="link" href="https://1800accountant.com/services/entity-formation">tax professionals</a> can guide you through each step, help with the necessary paperwork, and get in front of any potential tax consequences. We help ensure your business transition is smooth and beneficial, so it's a smooth and hassle-free switch from an LLC to a C Corp. Schedule a free business consultation today!</p>

LLCs are one of the most common business entities, and their members enjoy limited liability and other benefits, making them great business entities. However, LLCs can convert to C Corps to benefit their shareholders even more.&nbsp; Tax consequences are worth considering before ending an LLC and beginning a C Corp.&nbsp;When you convert an LLC to [&hellip;]

A business presentation in an office setting discussing the transition from llc to c corp, with a speaker pointing at a flip chart and attendees focusing on the presentation.

Converting-LLC-to-C-Corp_blog-header

Converting From LLC to C Corp: 3 Tax Consequences To Consider 

<p>Many people aspire to be their own boss. Setting their hours and making their own business decisions is liberation for some. You're no longer a tiny cog in the wheel!</p><p>But it also comes with increased pressure and responsibilities, taxes included. Now that you're self-employed, you'll have to pay your taxes directly to the IRS and make quarterly tax payments four times per year. And if you miscalculate, you could open yourself up to penalties and increased IRS scrutiny.&nbsp;</p><p>Read on to understand self-employment taxes, how to calculate them, and when to pay them.</p><h2 class="wp-block-heading" id="h-what-is-self-employment-tax">What is Self-Employment Tax?</h2><p>Self-employment tax refers to taxes paid by an independent contractor that goes to the federal programs of Medicare and Social Security.&nbsp;</p><p>Employers typically pay the Medicare and Social Security tax through FICA on their employees’ behalf. Employers withhold employee wages to pay one part of it, and they pay another portion themselves.&nbsp;</p><p>Self-employed individuals must pay both of those portions on their own.</p><h2 class="wp-block-heading" id="h-self-employment-tax-rate-for-2021-and-2022">Self-Employment Tax Rate for 2022 and 2023</h2><p>The IRS set the self-employment tax rate at 15.3 percent. That rate is the sum of two parts: A 12.4% Social Security tax rate and a 2.9% Medicare tax rate.&nbsp;</p><p>Your self-employment income is subject to the Medicare tax, but higher incomes are not subject to the Social Security portion beyond a set point. In 2022, only your first $147,000 in earnings were taxed at the Social Security rate. For the 2023 tax year, the Social Security tax applies to your first $200,000 in self-employment earnings.</p><h2 class="wp-block-heading" id="h-who-has-to-pay-self-employment-tax">Who Has to Pay Self-Employment Tax?</h2><p>Anyone with $400 or more in earnings from self-employment will be held liable for Social Security and Medicare taxes.&nbsp;</p><p>If you work multiple jobs and have at least one employer withholding income for FICA payments, you may or may not need to pay additional taxes, which will depend on the relative income and the amount paid by your employer.</p><h2 class="wp-block-heading" id="h-how-to-calculate-self-employment-tax">How to Calculate Self-Employment Tax</h2><p>Your self-employment tax total is calculated according to your net income, including wages and tips. Assuming your income doesn't exceed the set thresholds, you will pay 15.3 percent of your net earnings in self-employment tax.&nbsp;</p><h2 class="wp-block-heading" id="h-how-to-pay-self-employment-tax">How to File Self-Employment Taxes</h2><p>You can pay self-employment taxes <a class="link" href="https://www.irs.gov/payments/direct-pay" target="_blank" rel="noreferrer noopener">online through IRS Direct Pay</a>. You can calculate and report your self-employment taxes with IRS Form 1040, Schedule SE.&nbsp;</p><p>However, to make payments online, you must use your Social Security Number or an Individual Taxpayer Identification Number.&nbsp;&nbsp;</p><h3 class="wp-block-heading">Paying with a Social Security Number</h3><p>If you’re eligible for a <a class="link" href="https://www.ssa.gov/ssnumber/" target="_blank" rel="noreferrer noopener">Social Security Number and card</a> but don’t have one, you can apply for a number and card with the Social Security Office online. The government will use this number to identify you and your records for tax purposes.&nbsp;&nbsp;</p><h3 class="wp-block-heading">Paying with an Individual Taxpayer Identification Number</h3><p>For individuals who need to pay taxes but are ineligible for a Social Security Number, you can register for an <a class="link" href="https://www.irs.gov/pub/irs-pdf/fw7.pdf" target="_blank" rel="noreferrer noopener">Individual Taxpayer Identification Number with Form W-7</a>.&nbsp;</p><h2 class="wp-block-heading">Paying Self-Employment Tax with Estimated Taxes</h2><p>When an employer pays taxes on your behalf, they don't wait until the end of the year to make payments. These taxes calculated according to income are supposed to be paid throughout the tax year as you earn the income.&nbsp;</p><p>For independent earners, that means <a class="link" href="https://1800accountant.com/blog/quarterly-estimated-taxes">paying quarterly estimated taxes</a>. You can pay quarterly estimated taxes online and calculate your estimated payments using IRS Form 1040-ES. 1-800Accountant created an easy-to-use <a href="https://1800accountant.com/calculators/quarterly-tax-calculator" target="_self">quarterly estimated tax calculator</a> that you can use to see estimated year-to-date quarterly tax payment liability.</p><p>If you want to avoid fines or penalties for underpayment, you should make your estimated payments according to these quarterly deadlines in 2023:&nbsp;</p><ul><li>First Quarter Payment: April 18, 2023</li><li>Second Quarter Payment: June 15, 2023</li><li>Third Quarter Payment: September 15, 2023</li><li>Fourth Quarter Payment: January 15, 2024</li></ul><h2 class="wp-block-heading">Tax Deductions for the Self-Employed</h2><p>Handling these regular tax payments can be a significant financial burden for independent contractors, especially if they're not prepared. On the bright side, a wide variety of tax deductions available can help you increase your savings and balance some of the money you've lost to taxes.&nbsp;</p><p>If you’re self-employed, you are legally operating your own business, which means you can claim many legitimate costs as <a class="link" href="https://1800accountant.com/blog/maximize-small-business-tax-deductions">small business tax deductions</a>.&nbsp;&nbsp;</p><h3 class="wp-block-heading">Self-Employment Tax Deductions</h3><p>While being self-employed subjects you to extra taxes, you can claim some tax payments as deductible business expenses. You can deduct the portion of your self-employment taxes that an employer typically pays from your adjusted gross income.&nbsp;</p><h3 class="wp-block-heading">Home Office Deduction</h3><p>Many people work from home, but not everyone can claim a deduction for their home office. You can claim and deduct expenses related to your home office if it is your principal place of business. You must use a specific area of your home exclusively and regularly for work purposes.&nbsp;</p><p>If you meet those requirements, you can count a proportional amount of your home costs as a business expense, including utilities, internet, and rent or mortgage payments.&nbsp;</p><h3 class="wp-block-heading">Health Insurance Premiums</h3><p>Anything your employer would generally pay is likely eligible to be claimed as a tax deduction, including health insurance premiums.</p><p>As long as a spouse’s insurance plan cannot cover you, you can deduct the premiums for your health insurance or HMO from your taxable income using the <a class="link" href="https://1800accountant.com/blog/4-things-know-claiming-self-employment-health-insurance-tax-deduction">self-employment health insurance tax deduction</a>.&nbsp;</p><h3 class="wp-block-heading">Internet and Phone</h3><p>Depending on what you do, your internet and phone use may be essential for your work. You can deduct a portion of the costs for those services according to their proportional business usage.&nbsp;</p><h3 class="wp-block-heading">Meals or Travel</h3><p>If you travel exclusively for business purposes, you can claim all your lodging and travel costs as business expenses.&nbsp;</p><h3 class="wp-block-heading">Vehicle</h3><p>If you use your vehicle for a business purpose other than driving to and from a workplace, you can deduct related costs according to its use. With careful records, you can keep track of all your vehicle costs and deduct the qualifying portion.&nbsp;</p><p>A simplified option for deducting vehicle costs is to add up the miles you drive for business and deduct them according to the IRS’s standard mileage rates.&nbsp;</p><h3 class="wp-block-heading">Interest</h3><p>While the principal on many loans can’t be deducted, you can deduct the interest on loans, including your home mortgage, even if you don’t have a home office.</p><h3 class="wp-block-heading">Education</h3><p>The IRS sees continuing education as a regular and necessary part of the job. Any money you spend to help you do your job better or keep up with industry developments is money you can deduct for education expenses.&nbsp;</p><p>This also covers any fees you pay for professional publications or association memberships.&nbsp;</p><h3 class="wp-block-heading">Insurance</h3><p>Do you have a separate insurance policy covering a workplace or work-related need? If so, you can claim those premiums as tax deductions as well.&nbsp;&nbsp;</p><h3 class="wp-block-heading">Workplace Operation</h3><p>For those with an office separate from their home, you can deduct the rent and utilities for that office as work expenses. You can also remove any other costs related to maintaining your workplace.&nbsp;</p><p>Whether you have a separate office or not, you can deduct costs for office supplies, software, or technology used exclusively for your business and most costs related to employees and staff.&nbsp;&nbsp;</p><h3 class="wp-block-heading">Startup Costs</h3><p>The IRS also allows new businesses to claim deductions for startup costs. This includes many one-time expenses involved in setting up your workplace and establishing your work infrastructure.</p><h2 class="wp-block-heading">Self-Employment Taxes Made Easy with 1-800Accountant</h2><p>There are many opportunities to minimize your tax burden, and we urge you to take advantage of all that apply to you. Unfortunately, few self-employed individuals have the time or expertise to claim the savings they deserve.&nbsp;If that sounds like you, your best option to save money and avoid penalties is to work with the professionals at 1-800Accountant, America's leading virtual accounting firm for <a class="link" href="https://1800accountant.com/services/small-business-taxes">small businesses</a> and <a class="link" href="https://1800accountant.com/services/industry/freelancer-self-employed">self-employed individuals</a>. We'll provide financial advisory, calculate your quarterly estimated taxes, and more, so you can focus on growth.</p>

Many people aspire to be their own boss. Setting their hours and making their own business decisions is liberation for some. You&#8217;re no longer a tiny cog in the wheel! But it also comes with increased pressure and responsibilities, taxes included. Now that you&#8217;re self-employed, you&#8217;ll have to pay your taxes directly to the IRS [&hellip;]

A woman working at a desk with a computer, papers, and a coffee cup, with text overlay about "self-employment tax what to know for 2023.

self-employment-tax

Self-Employment Tax: What Is It, How to Calculate It, and When to Pay in 2023

<p>As a small business owner, you'll have questions about your business, business procedures, and taxes. You may have entity-specific or business tax questions, making receiving the correct answers urgently.</p>



<p>When tax season arrives, small business owners will have questions but only a little time to receive proper answers, assistance, and next steps. Here are answers to small business tax questions that small business owners are asking.</p>



<h2>Top 10 Small Business Tax Questions</h2>



<p>Here are the top 10 questions and answers to common tax questions that small business owners have:</p>



<h3>1. Can I Use Scanned Copies of Receipts for Tax Purposes?&nbsp;</h3>



<p>Scanned copies of receipts are okay to save and submit for tax purposes, and the IRS allows this as long as your receipts are identical to the original receipts. Your scanned receipts should also contain identical information to your original copies.</p>



<p>If you experience a tax audit but have scanned copies of your receipts, you'll want to save these records. With an audit, the IRS may require you to submit paper copies of your scanned receipts.</p>



<h3>2. How Do Taxes Work with a Small Business?</h3>



<p>Small businesses will<a class="link" href="https://www.sba.gov/business-guide/launch-your-business/choose-business-structure" target="_blank" rel="noreferrer noopener"> file and pay</a> their taxes based on their business entity. Businesses can choose their tax year when they file taxes for the first time.</p>



<p>Federally:</p>



<ul>
<li>Corporations pay income tax on their profits, and their shareholders pay personal income tax from the corporation's dividends.</li>



<li>Partnerships and sole proprietorships pay personal income tax and self-employment taxes.</li>



<li>S corporations pay taxes as pass-through entities, and their shareholders pay personal income tax.</li>



<li>Sole proprietors pay both personal taxes and self-employment taxes.</li>



<li>Multiple-member LLCs can elect to pay taxes as a corporation, partnership, or S corp. Single-member LLCs can pay taxes as sole proprietors.</li>
</ul>



<p>Depending on where you operate your business, your business may also have local and state taxes. If so, you may also have to pay employment taxes and state income taxes.</p>



<h3>3. How Much Can a Small Business Make Before Having To Pay Taxes?</h3>



<p>A small business's exact amount before paying taxes depends on its entity. Corporations can use Form 1120 to determine how much they'll pay in taxes.</p>



<p>Other business entities, such as LLCs, partnerships, S Corporations, and sole proprietorships, have different considerations for determining their income. These entities require their business owners to report income on their personal income tax returns, which means you'll have both business and nonbusiness income on your tax return.</p>



<p>Independent contractors and sole proprietors will have to pay taxes if they earn $400 or more.&nbsp;</p>



<h3>4. What Business Expenses Can You Claim On Taxes?</h3>



<p>The IRS <a class="link" href="https://www.thebalancemoney.com/deductible-business-expenses-3192959" target="_blank" rel="noreferrer noopener">has two requirements</a> for what business owners can claim as their business expenses.&nbsp;</p>



<p>Business expenses must be both ordinary and necessary. Ordinary expenses are expenses similar businesses or trades commonly pay for, and necessary expenses assist you in doing your business.</p>



<p>You can claim considerable business expenses as tax deductions:</p>



<ul>
<li>Advertising</li>



<li>Automobile expenses&nbsp;</li>



<li>Entertainment and meal expenses&nbsp;</li>



<li>Maintenance and repairs</li>



<li>Home office expenses&nbsp;</li>



<li>Transportation expenses</li>
</ul>



<h3>5. What Information Does a Small Business Need For Taxes?</h3>



<p>Small businesses will need several documents to file their <a class="link" href="https://1800accountant.com/services/small-business-taxes">small business taxes</a>. These documents include the following:</p>



<ul>
<li>Business assets and business expense information</li>



<li>Financial statement</li>



<li>Home office expenses for business owners using their home as their primary business site.</li>



<li>Vehicle use information if you’re seeking a tax deduction for business vehicles.</li>
</ul>



<h3>6. What Is The Easiest Way To Pay Estimated Taxes?</h3>



<p>The easiest way to pay estimated taxes is to use the Electronic Federal Tax Payment System (EFTPS). Businesses and individuals can use EFTPS to make estimated tax payments weekly, bi-weekly, monthly, or on a different schedule.</p>



<h3>7. What Is The Penalty For Not Paying Quarterly Taxes?</h3>



<p>The penalty for not paying quarterly taxes is 0.5% of the amount not paid for each month or part of the month that the quarterly tax remains unpaid. There's a maximum penalty of 25% for not paying quarterly taxes.</p>



<h3>8. What Will Trigger an IRS Audit?</h3>



<p>Although IRS audits are infrequent, there are red flags that <a class="link" href="https://aofund.org/resource/top-10-irs-audit-triggers-and-what-do-if-audited/" target="_blank" rel="noreferrer noopener">trigger an audit</a>. Small businesses may experience an IRS audit for:</p>



<ol>
<li>Undergoing significant changes in business expenses and business income.</li>



<li>Filing an incomplete tax return.</li>



<li>File a tax return with errors.</li>



<li>Mixing business expenses with personal expenses.</li>



<li>Not making a business profit for several years.</li>



<li>Not filing a tax return if a business experiences a financial loss.</li>



<li>Operating a business that deals with a lot of cash.</li>
</ol>



<h3>9. Which Receipts Can I Claim on My Taxes?</h3>



<p>As you collect your <a class="link" href="https://www.irs.gov/businesses/small-businesses-self-employed/what-kind-of-records-should-i-keep" target="_blank" rel="noreferrer noopener">business receipts</a> throughout the year, it may become difficult to know which receipts to keep for taxes.</p>



<p>&nbsp;You can claim receipts related to the following:</p>



<ul>
<li>Expenses&nbsp;</li>



<li>Gross receipts&nbsp;</li>



<li>Purchases</li>
</ul>



<p>Receipts related to expenses will show costs your business incurs other than purchases. You can claim expense receipts, including:</p>



<ul>
<li>Account statements</li>



<li>Canceled checks</li>



<li>Cash register tape receipts</li>



<li>Credit card receipts and statements</li>



<li>Invoices</li>
</ul>



<p>There are additional receipts related to business expenses that you should keep to claim as a tax deduction. The IRS requires you to prove these expenses to claim entertainment, gifts, transportation, and travel.&nbsp;</p>



<p>Gross receipts are another receipt type you can claim on your taxes. You can claim gross receipts, including:</p>



<ul>
<li>Cash register tapes</li>



<li>Deposit information&nbsp;</li>



<li>Form 1099-MISC</li>



<li>Receipt books</li>



<li>Invoices</li>
</ul>



<p>Purchases are the last receipt type that you can claim on taxes. You may use information from your purchases to claim credits or deductions on your tax return from:&nbsp;</p>



<ul>
<li>Canceled checks</li>



<li>Cash register tape receipts&nbsp;</li>



<li>Credit card receipts and statements</li>



<li>Invoices</li>
</ul>



<h3>10. Who Has To Pay Quarterly Taxes?</h3>



<p>There are three groups of people who have to make <a class="link" href="https://1800accountant.com/services/quarterly-estimated-taxes">quarterly tax payments</a>:&nbsp;</p>



<ol>
<li>Corporations</li>



<li>People without enough tax withheld&nbsp;</li>



<li>Self-employed workers</li>
</ol>



<p>Corporations may need to pay quarterly taxes if they expect to owe at least $500.</p>



<p>Second, if you need more taxes withheld, you should make quarterly tax payments. There are two criteria the IRS has for who needs to pay quarterly taxes for those not withholding enough taxes, and you'll need to meet both requirements to pay quarterly taxes in this group.</p>



<p>The first criterion is that you'll owe at least $1,000 in federal taxes after adding your tax credits and withholding. The second criterion is that your refundable credits and withholding cover the following:</p>



<ul>
<li>Less than 90% of your tax liability for the current year</li>



<li>100% of your liability for last year</li>



<li>110% for taxpayers with an adjusted gross income of $150,000 for taxpayers filing individually, or $75,000 for taxpayers who are married and filing jointly</li>
</ul>



<p>Third, self-employed workers, including freelancers and independent contractors, should pay their quarterly taxes if they owe $1,000 or more in taxes.</p>



<h3>Work with Expert Accountants To Help Navigate Small Business Taxes&nbsp;&nbsp;</h3>



<p>Small business taxes encompass different requirements for different entities. Federal, local, and state tax requirements and multiple business entities make it critical to get your small business questions answered.<br>When you need to answer small business tax questions, it's best to work with experts. Work with the expert accountants at <a class="link" href="https://1800accountant.com/services/business-tax-advisory">1-800Accountant</a> for your small business tax needs.</p>

As a small business owner, you&#8217;ll have questions about your business, business procedures, and taxes. You may have entity-specific or business tax questions, making receiving the correct answers urgently. When tax season arrives, small business owners will have questions but only a little time to receive proper answers, assistance, and next steps. Here are answers [&hellip;]

Text overlay reading "common tax questions from small business owners" on a background of scattered paper slips with tax-related terms.

Common-Tax-Questions

10 Common Small Business Tax Questions Owners Are Asking

<p>If you’ve been building a side hustle as an Etsy seller, and you’re wondering, “do I have to report Etsy income on my taxes?” you’ve come to the right place. Etsy is home to many artists and craftspeople selling their goods online – but you need to remember to report Etsy income when it’s time to file your returns. Some people work full-time as online sellers, making and distributing their products through online marketplace facilitators like Etsy, while others may only do it as a hobby in their spare time.</p><p>Whichever of those categories you fall into, you should be proud of yourself for the work you’ve put into becoming a small business owner. It’s not easy to find an audience and carve out a niche in the crowded world of internet commerce.</p><p>Whether you’re aware of it or not, you’re running a small business! That’s not a simple feat. And all of the money you make through selling your goods is income you’re earning as a self-employed <a class="link" href="https://1800accountant.com/blog/business-entity-sole-proprietorship">business owner of your sole proprietorship</a>.&nbsp;</p><p>Of course, running a business and earning income carry their own obligations, unfortunately. If you haven’t made very many Etsy sales yet, or if most of your income overall comes through an employer, your Etsy income is unlikely to have any effect on your situation for the tax year. However, you are required to report Etsy income to the IRS.&nbsp;</p><p>Do your due diligence to make sure you’re following the rules and avoiding any potential pitfalls! Here’s the process for reporting this income.</p><h2 class="wp-block-heading" id="h-lookout-for-form-1099-k-to-report-etsy-income"><strong>Lookout for Etsy Form 1099-K to Report Business Income</strong></h2><p>As the platform is processing your sales, Etsy is required to report those sales and give you a record of your overall income if you meet certain minimum sales amounts. Etsy will create and provide this report to you on form 1099-K. Receiving this tax form is the first important indicator that you will need to file all of your Etsy income on your tax return.&nbsp;</p><h2 class="wp-block-heading" id="h-what-is-a-1099-k">What is a 1099-K Form?</h2><p>The <a class="link" href="https://www.irs.gov/businesses/understanding-your-form-1099-k" target="_blank" rel="noreferrer noopener">IRS form 1099-K</a> is simply a report of the total gross sales that were paid to you on a platform. You might not have seen that same number released to you, depending on what the platform takes.&nbsp;</p><p>Etsy and similar platforms are required to create a 1099-K if you made more than a certain amount of online sales or received more than a set amount of money in business income. When they submit a 1099-K, they submit it simultaneously to you, the marketplace seller, and to the government. That means both you and the IRS are informed about the income you should be reporting on your taxes.</p><h3 class="wp-block-heading" id="h-can-you-deduct-business-expenses-when-you-report-etsy-income">Can you Deduct Business Expenses When You Report Etsy Income?&nbsp;</h3><p>You're required to report Etsy income on your income tax return. However, the good news is that you can claim deductions for business expenses as well. Because your Etsy shop is effectively a small business, you can deduct from your taxable income costs associated with operating your business.</p><p>Here are a few <a class="link" href="https://1800accountant.com/services/industry/freelancer-self-employed">self-employment deductions</a> you may be able to claim as an Etsy merchant:&nbsp;</p><ul><li>Platform fees</li><li>Marketing costs</li><li>Supplies and materials used for making your products or running your business</li><li>A portion of rent/mortgage/utility costs if you <a class="link" href="https://1800accountant.com/blog/home-office-deduction">qualify for a home office deduction&nbsp;</a></li><li>Other professional fees and subscription costs, including continuing education and skill development&nbsp;</li><li>Healthcare premiums if you are not eligible for healthcare through an employer or a spouse&nbsp;</li><li>Retirement savings contributions&nbsp;</li><li>Self-employment taxes for Social Security and Medicare</li></ul><h2 class="wp-block-heading" id="h-what-taxes-do-etsy-sellers-pay">What Taxes Do Etsy Sellers Pay?&nbsp;</h2><p>Everything explained so far above has to do with income tax, which is the largest tax you’re responsible for as an individual taxpayer in the United States. However, there are a couple of separate but related taxes and tax issues that you should be aware of.&nbsp;</p><h3 class="wp-block-heading" id="h-self-employment-tax">Self-Employment Tax</h3><p>If you earn wages through an employer, you’re probably used to having a part of your salary withheld to pay for income taxes and something called FICA. Employers withhold 7.65% of your income to pay into Social Security and Medicare on your behalf, and then they pay another 7.65% of your income out of their money but in your name.&nbsp;</p><p>The self-employment tax refers to this second 7.65% which is usually paid by the employer. If you are in business for yourself, then you are responsible for paying both halves for a total of 15.3%.&nbsp;&nbsp;</p><h3 class="wp-block-heading" id="h-quarterly-estimated-taxes">Quarterly Estimated Taxes</h3><p><a class="link" href="https://1800accountant.com/services/quarterly-estimated-taxes">Quarterly estimated taxes</a> are actually a part of your taxable income obligations, but they’re also something you might not be used to if you’re accustomed to working for an employer.&nbsp;</p><p>Income taxes in the United States must be paid as you earn throughout the year and not at the end of the year. Employers usually handle this on their employees’ behalf. However, if you make most or all of your money as an independent small business, you will need to do this yourself.&nbsp;</p><p>You can pay your taxes as you go by making quarterly estimated tax payments. You estimate the total taxes you will owe, and then you pay a quarter of it at a time. The IRS sets four annual deadlines for these four tax installments. The four quarterly estimated tax deadlines are:&nbsp;</p><ul><li>First quarter tax deadline: April 15</li><li>Second quarter tax deadline: June 15</li><li>Third quarter tax deadline: September 15</li><li>Fourth quarter tax deadline: January 15 of the following year&nbsp;</li></ul><h3 class="wp-block-heading" id="h-sales-tax">State Sales Tax</h3><p>On top of the income and income-related taxes, Etsy sellers also have to be concerned about state sales tax. This is a tax on the customer transactions themselves, and the laws on these are set entirely at the state level.&nbsp;</p><p><a class="link" href="https://1800accountant.com/blog/etsy-store-sales-tax">Etsy store sales tax rules are complicated</a> because it depends on where each customer is located and the relationship your business has with that state. You must pay sales tax on purchases made in states where your business has a significant presence or “nexus” of business activity.&nbsp;</p><p>This means that if a single customer from a state buys a product of yours, and you aren’t located there, you probably won’t owe sales tax there. However, if you start selling to more customers there, you will likely have to remit some sales tax money to that state. Exact minimum requirements and sales tax percentages vary depending on the state.&nbsp;</p><p>Etsy and other similar online platforms have the infrastructure to collect and remit sales tax, but they don’t always do it automatically if you don’t instruct them to. Make sure you’re getting the right taxes taken out of your sales.&nbsp;&nbsp;</p><h2 class="wp-block-heading" id="h-1-800accountant-makes-reporting-etsy-income-a-breeze">1-800Accountant Makes Reporting Etsy Income a Breeze</h2><p>There are numerous requirements and challenges that come with <a class="link" href="https://1800accountant.com/services/small-business-taxes">doing small business taxes</a> and reporting Etsy income, but you don’t have to figure it out on your own. Work with a professional from 1-800Accountant and ensure that you’ll be prepared when tax season comes around.&nbsp;</p><p>An expert ecommerce tax accountant can make filing your tax return a simple and efficient process, and you’ll be able to rest easy knowing that you’re saving as much money as possible. Get help from an <a class="link" href="https://1800accountant.com/services/industry/ecommerce">Etsy accounting professional</a> and focus on the creative work you do that earned you this income in the first place!</p>

If you’ve been building a side hustle as an Etsy seller, and you’re wondering, “do I have to report Etsy income on my taxes?” you’ve come to the right place. Etsy is home to many artists and craftspeople selling their goods online – but you need to remember to report Etsy income when it’s time [&hellip;]

A person in a yellow sweater packaging a handmade soap bar at a craft table surrounded by various natural ingredients and materials.

report-etsy-income

How to Report Etsy Income to the IRS

<p>For business owners, equity is a vital tool that you can use to your advantage. There are different equity types that serve different purposes within your business. Here’s an overview of what equity is and how to calculate equity in a business.</p>



<h2>What does equity mean in business?&nbsp;</h2>



<p>Equity comprises the net value of a business; it’s the result of a company's assets minus its liabilities. The bookkeeping term <a class="link" href="https://1800accountant.com/blog/common-bookkeeping-terms">equity</a> is important because it gives you an idea of:&nbsp;</p>



<ul><li>How much the shareholders would receive if they sold their stake in the company&nbsp;</li><li>Money left over for shareholders following asset liquidation and debt repayment</li><li>The net value of a business</li></ul>



<p>For businesses, equity can have multiple meanings for the value of their finances. Equity can refer to:&nbsp;</p>



<ul><li>Balance sheet</li><li>Liquidation</li><li>Real estate&nbsp;</li><li>Stocks&nbsp;</li></ul>



<p>When referencing the<a class="link" href="https://1800accountant.com/blog/bookkeeping-101-what-is-a-balance-sheet"> balance sheet</a>, equity refers to the total of common stock, paid-in capital, preferred stock, and retained earnings. This form of equity is shareholders’ equity.</p>



<p>Equity from liquidation is what remains following a business's bankruptcy and liquidation.&nbsp;</p>



<p>This form of equity is ownership equity. If your business is in a poor financial state before liquidation, there’s a chance that there won’t be ownership equity following debt repayment.</p>



<p>The third variation of equity in business is real estate. In this instance, equity is what remains after deducting the fair market value of your property from the balance you owe on your mortgage.</p>



<p>Finally, when referring to stocks, equity refers to the ownership interest that a business has. Investors can buy equity shares either as common stock or preferred stock. With stocks, equity represents the amount investors can receive as cash for the share.</p>



<h2>What are the different types of equity?</h2>



<p>Businesses use different types of equity, which illustrate what business owners, investors, and shareholders can learn about your company.&nbsp;</p>



<p>There are <a class="link" href="https://www.investopedia.com/ask/answers/012115/what-are-components-shareholders-equity.asp" target="_blank" rel="noreferrer noopener">multiple equity types</a> that a business may use to determine its value:</p>



<ul><li>Common stock&nbsp;</li><li>Negative equity</li><li>Positive equity</li><li>Preferred stock</li><li>Retained earnings&nbsp;</li><li>Treasury stock</li></ul>



<p>Common stock indicates that a person owes shares in a corporation. These shareholders represent an ownership stake in a company that allows them to receive profits from its operations.&nbsp;</p>



<p>Common stock shareholders receive distributions made by the company through dividends or stock repurchases. As a common stock shareholder, you can:&nbsp;</p>



<ul><li>Elect board members with one vote per share&nbsp;</li><li>Meet with other investors to elect board members</li><li>Vote on major decisions affecting your business, including who sits on its board and what projects it pursues&nbsp;</li></ul>



<p>Preferred stock differs from common stock with dividends and voting procedures:</p>



<ul><li>Preferred stock has a set dividend rate, which can be fixed or variable based on company performance&nbsp;</li><li>These shareholders aren’t able to vote to elect a board of directors or for major company decisions</li><li>This type of stock also allows you to participate in distributions made by the company through dividends or stock repurchases</li></ul>



<p>Businesses can experience positive equity or negative equity. Negative equity is an indicator that a company has more liabilities than assets. Positive equity indicates that a company has sufficient assets to pay its liabilities.</p>



<p>Retained earnings are the percentage of net earnings not paid to shareholders as a dividend. Businesses can use these earnings to pay debts or to reinvest.</p>



<p>Treasury stock represents the number of shares that a business repurchases from investors. On a balance sheet, you’ll list this stock as a negative number within the equity section.</p>



<h2>How To Calculate Business Equity in Accounting</h2>



<p>Businesses can calculate equity accounting in a few steps:&nbsp;</p>



<ul><li>Calculate your total assets&nbsp;</li><li>Calculate your total liabilities&nbsp;</li><li>Subtract your total assets from your total liabilities&nbsp;</li></ul>



<p>To calculate what is equity in business, you first need to determine the value of all the assets:</p>



<ul><li>This includes current assets and long-term assets&nbsp;</li><li>Current assets are assets you can convert to cash in a year or less</li><li>Long-term assets are assets that can’t be converted to cash within one year</li></ul>



<p>Next, you’ll subtract assets from all of your liabilities:&nbsp;</p>



<ul><li>This includes current liabilities and long-term liabilities&nbsp;</li><li>Current liabilities are debts owed within one year</li><li>Long-term liabilities are debts that can’t be paid within one year</li></ul>



<p>The resulting number is equity.</p>



<p>Here’s an example of equity: A small business has total assets of $3 million and total liabilities of $500,000. From this, you would deduct the $3 million in total assets from the $500,000 in total liabilities to get an equity of $2.5 million.</p>



<h2>How Can You Use Equity To Grow Your Business</h2>



<p>If you want to grow your business, but don't have access to the capital required, then equity is an option. As a business owner, <a class="link" href="https://www.forbes.com/sites/forbesbusinesscouncil/2021/09/15/how-private-equity-can-help-build-your-business/?sh=6f6e115068b6" target="_blank" rel="noreferrer noopener">there are ways</a> you can use equity for business growth, or you can work with private equity investors for business growth.</p>



<p>Equity allows you to give away part of the ownership of your company for investing. You can then use this money to invest in a new product or service to make more money for both parties involved.</p>



<p>The next way you can use equity for business growth is to work with private equity investors. These investors can work with businesses to propel business growth, and there may be business advantages in doing so. By partnering with private equity investors, you’ll get liquidity. You can also choose to remain invested in your business as well.</p>



<h3>Work with a Professional&nbsp;</h3>



<p>Equity can be a useful tool for growing and sustaining business growth over time. It has several uses and provides a good overview of your business value.&nbsp;</p>



<p>When it’s time to determine your business equity, or receive help for your small business bookkeeping needs, work with the professionals. Work with an accounting professional at <a class="link" href="https://1800accountant.com/services/bookkeeping">1-800Accountant</a> for all of your bookkeeping and accounting needs.&nbsp;</p>

For business owners, equity is a vital tool that you can use to your advantage. There are different equity types that serve different purposes within your business. Here’s an overview of what equity is and how to calculate equity in a business. What does equity mean in business?&nbsp; Equity comprises the net value of a [&hellip;]

An equity chart displaying an increase over time.

Equity-&#038;-How-to-Calculate_blog-header (1)

What Is Equity in Business and How to Calculate It

<h2>What is Small Business Saturday?</h2>



<p>Small Business Saturday is part of a trio of events that kick off the holiday shopping season. It's meant to encourage consumers to take a break from the Walmarts and Amazons of the world and embrace the businesses that make up the backbone of their communities. Small Business Saturday always happens on the Saturday after Black Friday, which falls on November 26th this year.</p>



<p>Small business owners should be prepared to maximize opportunities during this critical day. The additional revenue helps businesses end the holiday season strong, propelling them toward a fruitful new year. If you have yet to prepare or are searching for additional tips, check out these great Small Business Saturday ideas to help get the word out and engage your new customers!</p>



<h2>How to Promote Small Business Saturday</h2>



<h3><strong>1. Get the Word Out</strong></h3>



<p>Ramp up your communications with existing customers, so they remember not to spend their entire gift budget during Black Friday! Encourage word of mouth among them and reward their loyalty with a discount. Here are some other ideas to help you raise awareness among customers and prospects.&nbsp;&nbsp;&nbsp;&nbsp;</p>



<ul>
<li>Let them know you’ll be fully stocked with popular items.</li>



<li>Cross-promote your products with other small businesses.</li>



<li>Invest in paid social media campaigns.&nbsp;&nbsp;</li>



<li>Build an <a class="link" href="https://www.campaignmonitor.com/blog/email-marketing/2020/03/how-to-build-an-email-marketing-funnel-for-conversions/#:~:text=An%20email%20funnel%20is%20a,right%20time%20to%20elicit%20action." target="_blank" rel="noreferrer noopener">e-mail marketing funnel campaign</a> that leads up to Small Business Saturday.</li>
</ul>



<h3><strong>2. Extend Store Hours</strong></h3>



<p>Small Business Saturday takes place during a busy holiday weekend, so accommodate your customers and prospects by extending store hours. Make sure to display signage with the modified hours and let your customers know via every touchpoint available, including social media and email. They'll appreciate the heads-up.&nbsp;</p>



<h3><strong>3. Make Direct Contact with Customers</strong></h3>



<p>Most of the foot traffic you receive on Small Business Saturday will be local. A great way to raise awareness is to mail coupons and specials to consumers who live within a few miles of your business.</p>



<p>And if you have an existing mailing list, consider providing exclusive deals and discounts to your most loyal customers who support you throughout the year.&nbsp;</p>



<h3><strong>4. Invest in Extra Advertising</strong></h3>



<p>There are many ways to<a class="link" href="https://www.thebalancesmb.com/small-business-marketing-ideas-2951688" target="_blank" rel="noreferrer noopener"> advertise</a> before Small Business Saturday. We've identified great options for every budget. You can advertise via these impactful methods:&nbsp;</p>



<ul>
<li>Billboards&nbsp;</li>



<li>Online ads</li>



<li>Social media campaigns</li>



<li>Newspaper&nbsp;</li>



<li>Radio&nbsp;</li>



<li>TV</li>
</ul>



<h3><strong>5. Offer Special Discounts or Promotions</strong></h3>



<p>Everyone loves a deal, and your customers and prospects are no different. You can offer discounts and promotions that are good for a certain period during the holidays or are only valid during Small Business Saturday.<br><br>If you've run special discounts and promotions, look back to see what worked and amplify that approach. And make sure you keep track of what moves the needle in the aftermath of your efforts for Small Business Saturday 2022.&nbsp;&nbsp;</p>



<h3><strong>6. Reward Participation&nbsp;</strong></h3>



<p>Offer something special to your customers that is so irresistible that they have no choice but to stop in! Whether it’s doorbusters, a gift with a purchase of a certain amount, or a giveaway, you can find many ways to reward shopper participation. And word gets out fast. Make this a tradition, and customers will reward you with their loyalty.&nbsp;&nbsp;</p>



<h3><strong>7. Hold Contests</strong></h3>



<p>Contests build excitement and intrigue, especially if you're giving away a unique prize. Hold contests on Small Business Saturday or tease a grand prize that will be given away at the end of the holiday shopping season.&nbsp;&nbsp;</p>



<h2>Work With The Pros</h2>



<p>We hope these Small Business Saturday promotion ideas help! The right strategy for Small Business Saturday will increase profits and help you grow your business. The right <a class="link" href="https://1800accountant.com/services/small-business-taxes">tax strategy and services</a> can help you go even further. Schedule a call with <a class="link" href="https://1800accountant.com/">1-800Accountant</a>, America's leading virtual accounting firm, to learn what our suite of services can do for you!</p>

What is Small Business Saturday? Small Business Saturday is part of a trio of events that kick off the holiday shopping season. It&#8217;s meant to encourage consumers to take a break from the Walmarts and Amazons of the world and embrace the businesses that make up the backbone of their communities. Small Business Saturday always [&hellip;]

Small Business Saturday promotion ideas for 2022

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7 Small Business Saturday Promotion Ideas for 2022

<p>If you drive trucks, sell trucks, or run any trucking-related business, you need to be familiar with all the taxes and fees associated with trucks. For truckers just starting, you may need to budget for these tax responsibilities ahead of time.&nbsp;</p>
<p>Truck drivers who drive big rigs on the highway must&nbsp;<a class="link" href="https://www.irs.gov/help/ita/do-i-need-to-pay-the-heavy-highway-vehicle-use-tax" target="_blank" rel="noreferrer noopener">pay the Heavy Highway Vehicle Use Tax</a>&nbsp;for their use of the highway each year. But the first tax a new truck driver will encounter is the federal excise tax on trucks.&nbsp; &nbsp;</p>
<h2>What is Federal Excise Tax on Trucks?</h2>
<p><a class="link" href="https://www.investopedia.com/terms/e/excisetax.asp">Federal Excise taxes</a> are taxes imposed on specific goods&nbsp;or products like gasoline or cigarettes. They are usually paid at the point of purchase and are usually included in the product's price.&nbsp;</p>
<p>The federal government imposes a specific excise tax on the sales of trucks and tractors. For the government's purposes, a truck is defined as a highway vehicle primarily designed to transport its load on the same chassis as the engine, even if it's equipped to tow a vehicle, such as a trailer or a semitrailer. That definition includes smaller trucks, but only trucks of a certain size require paying this tax.</p>
<p>Meanwhile, a tractor is defined as a highway vehicle designed to tow a vehicle, such as a trailer or a semitrailer. A tractor may carry incidental items of cargo when towing or limited amounts of cargo when not towing. A truck, truck trailer, or semitrailer is considered a sale of a chassis and a body.</p>
<p>The seller is liable for the tax. The seller may accept a statement from the buyer in good faith, stating that under penalties of perjury and executed in good faith, the purchaser intends to resell or lease on a long-term basis. The purchaser will be liable for the tax when the article is ultimately sold to a new buyer who will use it for its intended purpose.&nbsp;</p>
<h2>When Do You Pay Federal Excise Tax (FET) on Trucks?</h2>
<p><a class="link" target="_blank" href="https://www.irs.gov/pub/irs-pdf/p510.pdf" rel="noreferrer noopener">IRS Publication 510 on Excise Taxes</a>&nbsp;says that the Federal Excise Tax (FET) is imposed on the "first retail sale," meaning the first sale for a purpose other than resale or leasing in a long-term lease, after manufacture, production, or importation.</p>
<p>Form 720 must be filed with the IRS for each quarter if you were liable for or responsible for collecting Federal Excise Tax. The due date is on or before the end of the month following the close quarter.</p>
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        <td class="cell-0">Quarter</td>
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        <td>Q1</td>
        <td>January-March</td>
        <td>April 30</td>
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        <td>Q2</td>
        <td>April-June</td>
        <td>July 31</td>
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        <td>Q3</td>
        <td>July-September</td>
        <td>October 31</td>
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        <td>Q4</td>
        <td>October-December</td>
        <td>January 31</td>
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<h2>How to Calculate Federal Excise Tax On Trucks</h2>
<p>Internal Revenue Code Section 4051 imposes a 12 percent federal excise tax on the first retail sale of the following: trucks chassis and bodies, truck trailer and semitrailer chassis and bodies, and tractors used mostly for highway haulage in combination with a trailer or semitrailer.</p>
<p>The FET does not apply to truck chassis and bodies suitable for use with a vehicle with a gross vehicle weight of 33,000 pounds or less. The FET also does not apply to a truck trailer and semitrailer chassis and bodies suitable for use with a trailer or semitrailer with a gross vehicle weight of 26,000 pounds or less.&nbsp;</p>
<p>Tractors with a gross vehicle weight of 19,500 or less and a gross combined weight of 33,000 pounds or less are excluded from the 12% FET.</p>
<h2>Do You Pay Excise Tax on Used Trucks?</h2>
<p>The FET is paid on the initial sale or use of the truck. If the truck were bought and used previously, an excise tax would usually be unnecessary.&nbsp;</p>
<p>However, there may be some instances where a used truck may be subject to FET. If the truck were exported to another country, the export would be exempt from FET. However, when imported back to the US, and there is a subsequent sale, FET would be triggered as if it were an initial sale or use.&nbsp;</p>
<p>These sales are also ordinarily <strong>exempt from federal excise taxes</strong>:</p>
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        <td>Sales to a state or local government for its exclusive use.</td>
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        <td>Sales to Indian tribal governments, but only if the transaction involves the exercise of an essential tribal government function.</td>
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        <td>Sales to a nonprofit educational organization for its exclusive use</td>
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        <td>Sales to a qualified blood collector organization (as defined under&nbsp;<a class="link" href="https://www.irs.gov/pub/irs-pdf/p510.pdf" target="_blank" rel="noreferrer noopener">Communications Tax in chapter 4</a>) for collecting, storing, or transporting blood</td>
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        <td>Sales for use by the purchaser for further manufacture of other taxable articles</td>
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        <td>Sales for export or resale by the purchaser to a second purchaser for export</td>
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        <td>Sales to the United Nations for official use</td>
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<h2>What Do Excise Taxes Fund?&nbsp;</h2>
<p>These taxes fund the Highway Trust Fund, and expenditures are generally used to repair and expand the federal highway system of the United States. Trucks and other heavy vehicles create a lot of extra wear and tear on roads, so these excise taxes contribute to ongoing road maintenance and infrastructure repair.&nbsp;</p>
<h2>The Heavy Vehicle Use Tax&nbsp;</h2>
<p>The seller is responsible for the retail FET due to a truck or trailer. The truck owner is responsible for filing and paying&nbsp;<a class="link" href="https://1800accountant.com/blog/form-2290">Form 2290</a> for Heavy Highway Vehicle Use. This is an annual tax on the continuing use of heavy load-bearing vehicles. If the truck isn't used frequently, you may be able to waive the tax.&nbsp;</p>
<p>Only trucks that weigh 55,000 pounds or more require their owners to pay this tax. The deadline to file for the first time is the last day of the next month after the truck's first use. See the form itself to find out how much your tax will be.&nbsp;</p>
<h2>Consult a Professional</h2>
<p>If you're unsure about your obligations as a truck driver or seller, speak to an <a class="link" href="https://1800accountant.com/services/industry/trucking">accountant with expertise in the trucking industry</a>. An accountant can also guide you through the paperwork and smooth out the process for you. It's important to be informed and know your obligations, but sometimes the smartest thing to do is to let an expert help out. Getting someone who knows their way through the system can help you save money and make your business more efficient.&nbsp;</p>

If you drive trucks, sell trucks, or run any trucking-related business, you need to be familiar with all the taxes and fees associated with trucks. For truckers just starting, you may need to budget for these tax responsibilities ahead of time.&nbsp; Truck drivers who drive big rigs on the highway must&nbsp;pay the Heavy Highway Vehicle [&hellip;]

Two trucks driving on a curvy road through a desert landscape with distant snow-capped mountains under a cloudy sky.

trucker-taxes-excise-tax

Federal Excise Tax on Trucks: Everything You Need to Know

<p><strong>What is an LLC?</strong> <strong>Is an LLC a business entity?</strong> A Limited Liability Company can be a great way to grow a small business. It offers limited liability, something that can be helpful to its members.</p><iframe width="560" height="315" src="https://www.youtube.com/embed/ObCZuUXI_bU?si=pRnZBaB0ab3ppUmF" title="YouTube video player" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen=""></iframe><p>While this type of business organization can offer a lot of benefits, like limited liability protection, there are some drawbacks you’ll want to know about. Here’s what you should know, how to form one, and more information.&nbsp;</p><h2 class="wp-block-heading" id="h-what-is-an-llc">What is an LLC?</h2><p>An LLC is a business entity type that offers owners, called members,<a class="link" href="https://www.irs.gov/businesses/small-businesses-self-employed/limited-liability-company-llc" target="_blank" rel="noreferrer noopener"> limited liability</a>. The qualifications are very broad: corporations, foreign entities, individuals, and other LLCs can join a Limited Liability Company.&nbsp;</p><p>It is important to note that an LLC can have an unlimited number of members. It is also possible to have a <a class="link" href="https://www.irs.gov/businesses/small-businesses-self-employed/single-member-limited-liability-companies" target="_blank" rel="noreferrer noopener">single-member LLC</a> as well.&nbsp;</p><h2 class="wp-block-heading" id="h-do-you-need-one">Do You Need One?</h2><p>You may need a Limited Liability Company if you want to form a business entity that:&nbsp;</p><ul><li>Allows you to form as a single member</li><li>Has no maximum number of members</li><li>Has the flexibility to file and pay taxes as other <a class="link" href="https://www.irs.gov/businesses/small-businesses-self-employed/llc-filing-as-a-corporation-or-partnership" target="_blank" rel="noreferrer noopener">business entity types</a></li></ul><h2 class="wp-block-heading" id="h-what-are-the-benefits">What are the Benefits?</h2><p>Forming an LLC has <a class="link" href="https://www.thebalance.com/limited-liability-companies-for-beginners-357531" target="_blank" rel="noreferrer noopener">several benefits</a>, which include:&nbsp;</p><ul><li>A choice between manager-managed or member-managed</li><li>Limited liability</li><li>Fewer paperwork requirements&nbsp;</li><li>Flexible profit and loss allocation</li><li>Tax status flexibility</li></ul><p>LLCs can operate as either a manager-run or member-run company. In manager-managed LLCs, members select managers to operate the business. These managers will conduct work for the company.&nbsp;&nbsp;&nbsp;</p><p>In member-managed LLCs, owners will have a role in daily operations.&nbsp; All members share limited liability, meaning they aren't personally liable if the company experiences legal trouble.&nbsp;</p><p>Another benefit is the paperwork requirements. While other business entities require annual reports, board of director meetings, and state requirements, LLCs don't have as many required forms of upkeep.&nbsp;</p><p>Fourth, profits and losses can be split in several ways. Members will agree to the terms of profits and losses in the Operating Agreement.&nbsp;</p><p>LLCs also have greater flexibility when it comes to tax status. They can experience taxation as a general partnership, meaning members will complete a <a class="link" href="https://www.irs.gov/forms-pubs/about-schedule-k-1-form-1065" target="_blank" rel="noreferrer noopener">Schedule K-1</a> to report profits and losses.&nbsp;</p><h2 class="wp-block-heading" id="h-what-are-the-disadvantages">What are the Disadvantages?</h2><p>Even though there are several benefits, there are also disadvantages.&nbsp;</p><p>In many states, if a member leaves an LLC, it must dissolve. The remaining members can start a new multi-member LLC, but those members will pay a termination fee.&nbsp;</p><p>Members must pay a self-employment tax if they file taxes as a general partnership. These members will be considered self-employed. As a result, these members will pay a self-employment tax.&nbsp;</p><h2 class="wp-block-heading" id="h-how-to-start-an-llc">How to Start an LLC</h2><p>If you want to <a class="link" href="https://www.thebalancesmb.com/how-to-set-up-a-limited-liability-company-llc-1200859" target="_blank" rel="noreferrer noopener">start an LLC</a>, there are a few things that you'll need:&nbsp;</p><ul><li>Articles of Organization (to submit to your Secretary of State)</li><li>Business name (that is both available and unique)</li><li>Licenses and permits (which will vary by industry and state)</li><li>Newspaper notice (not a requirement in all states)&nbsp;</li><li>Operating Agreement&nbsp;</li><li>A registered agent (to receive legal documents)&nbsp;</li><li>Tax registrations</li></ul><h2 class="wp-block-heading" id="h-how-to-convert-to-an-llc">How to Convert to an LLC</h2><p>You can convert your business entity to a Limited Liability Company if your business is:&nbsp;</p><ul><li>A C-Corp</li><li>An S-Corp</li><li>A sole-proprietorship</li></ul><p>First, you can convert your C-Corp by <a class="link" href="https://smallbusiness.chron.com/convert-c-corporation-llc-3772.html" target="_blank" rel="noreferrer noopener">doing the following</a>:&nbsp;</p><ul><li>File Articles of Organization (required in most states)&nbsp;</li><li>File an Operating Agreement (contact your state's Secretary of State)</li><li>Dissolve the C-Corp:<ul><li>File and write the C-Corp's Articles of Dissolution&nbsp;</li></ul></li><li>Transfer assets</li></ul><p>Another option you can consider is converting your S-Corporation to an LLC. To do this, you'll:&nbsp;</p><ul><li>File necessary paperwork<ul><li>The exact paperwork and requirements will vary by state.<ul><li>Some states may want you to send paperwork to the Secretary of State before converting your business.&nbsp;</li><li>Other states may require your LLC to merge with the S-Corp and name your LLC as the surviving company.&nbsp;</li></ul></li></ul></li><li>Liquidate assets for S-Corp and return them to shareholders.<ul><li>After LLC receives state recognition, the S-Corporation shareholders will contribute to LLC's assets.&nbsp;</li></ul></li></ul><p>A third option you can consider is converting your <a class="link" href="https://smallbusiness.chron.com/sole-proprietorship-llc-22296.html" target="_blank" rel="noreferrer noopener">sole proprietorship</a>. You'll do this by:&nbsp;</p><ul><li>Checking the availability of the proposed name&nbsp;</li><li>File Articles of Organization (required in most states)&nbsp;</li><li>File an Operating Agreement&nbsp;</li><li>Obtain an <a class="link" href="https://www.irs.gov/businesses/small-businesses-self-employed/apply-for-an-employer-identification-number-ein-online" target="_blank" rel="noreferrer noopener">Employer Identification Number&nbsp;</a></li><li>Transfer assets&nbsp;</li></ul><h2 class="wp-block-heading" id="h-differences-between-llc-s-corp-c-corp-and-partnerships">Differences between LLC, S-Corp, C-Corp, and Partnerships</h2><p>If you want to form an LLC, you may want to know how it <a class="link" href="https://1800accountant.com/blog/6-tricks-to-choosing-the-best-entity-for-your-small-business" target="_blank" rel="noreferrer noopener">compares to other business entities</a>.&nbsp;S-Corps, C-Corps, and partnerships have distinct advantages; learn more about how they stack up.</p><h3 class="wp-block-heading" id="h-c-corps">C-Corps</h3><p><a class="link" href="https://www.thebalancesmb.com/what-is-the-difference-between-an-llc-and-a-corporation-397526" target="_blank" rel="noreferrer noopener">C-Corps and LLCs</a> differ in important ways. First, C-Corps experience double taxation.&nbsp;</p><p>This means that taxation occurs once when the corporation's income experiences taxation and again when members, called shareholders, experience taxation again on individual income.&nbsp;</p><p>LLCs don't pay income taxes, but the members pay self-employment taxes. C-Corps experience double taxation, but shareholders don't pay self-employment taxes.</p><h3 class="wp-block-heading" id="h-partnerships">Partnerships</h3><p>While <a class="link" href="https://www.thebalancesmb.com/which-should-i-form-an-llc-or-a-partnership-398646" target="_blank" rel="noreferrer noopener">LLCs and partnerships</a> may seem similar, there are some crucial differences. LLCs operate under an operating agreement that defines members' percentages of ownership. Members will pay tax individually after profits are passed to its members.</p><p>Partners in a partnership share profits and losses of the business according to the percentage of their share. Partners will complete a partnership agreement before forming their partnership.&nbsp;</p><p>While a domestic LLC offers limited liability to all members, partners in partnerships have personal liability.</p><h3 class="wp-block-heading" id="h-s-corps">S-Corps</h3><p>Finally, while an LLC has few member requirements, an <a class="link" href="https://www.investopedia.com/articles/personal-finance/011216/s-corp-vs-llc-which-should-i-choose.asp" target="_blank" rel="noreferrer noopener">S-Corp</a> is different. An S-Corp must have a board of directors and corporate officers, two things not required with an S-Corp.&nbsp;</p><p>Second, S-Corps have a limit of 100 shareholders. An LLC has no limit to the number of people who can join.</p><p>Another difference is how long the business entities can exist. LLCs dissolve after their member or LLC owner leaves the company. S-Corps will continue if its shareholders leave the corporation.</p><iframe width="560" height="315" src="https://www.youtube.com/embed/Xfg2zOL-ro4?si=Z2YzJHEmo-tFtoDr" title="YouTube video player" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen=""></iframe><h2 class="wp-block-heading" id="h-seek-professional-entity-formation-advice">Seek Professional Entity Formation Advice</h2><p>Forming your new business is an important milestone. Work with the pros at <a class="link" href="https://1800accountant.com">1-800Accountant</a> today for your <a class="link" href="https://1800accountant.com/services/entity-formation">entity formation</a> and <a class="link" href="https://1800accountant.com/services/small-business-taxes">small business</a> needs. Our professional advisers can offer guidance and support on your small business ownership journey!&nbsp;</p>

What is an LLC? Is an LLC a business entity? A Limited Liability Company can be a great way to grow a small business. It offers limited liability, something that can be helpful to its members. While this type of business organization can offer a lot of benefits, like limited liability protection, there are some [&hellip;]

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Business Entity: What Is an LLC?

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