As tax season approaches it is important to understand what is required in order to insure that you reap the full benefits from your tax refund. There are many common questions that people ask when it comes to filing taxes. What forms do you file? What are the deductions for the self-employed? What Tax Fees will I have to pay?
What Tax Forms to File
As a work at home business you will have to file form 8829, a sole proprietor files a schedule C or C-EZ from form 1040, a partnership files form 1065, and corporations must file form 1120, 1120-S, or 1120-A. For a more in depth explanation and a down loadable copy of each form you can go to the IRS site below.
Deductions
There are many deductions for a home business. Make sure that you take advantage of all of these deductions in order to get a maximum refund. Some of these deductions include rent, utilities, supplies, travel, repairs or maintenance, interest, insurance , wages of employees if you have any, etc. A more thorough list can be found below.
List of Common Business Deductions
Tax Fees
There are two types of taxes that the self-employed must pay. The first one is the Self-employment tax. This is basically a social security and medicare tax for people who work for themselves. You do not need to pay this if your total income was less than $400. You can read more about this here:
Self Employment Tax
The other type of tax is the Estimated Tax. According to the IRS there are two general rules that determine if estimated tax is owed:
What Tax Forms to File
As a work at home business you will have to file form 8829, a sole proprietor files a schedule C or C-EZ from form 1040, a partnership files form 1065, and corporations must file form 1120, 1120-S, or 1120-A. For a more in depth explanation and a down loadable copy of each form you can go to the IRS site below.
Deductions
There are many deductions for a home business. Make sure that you take advantage of all of these deductions in order to get a maximum refund. Some of these deductions include rent, utilities, supplies, travel, repairs or maintenance, interest, insurance , wages of employees if you have any, etc. A more thorough list can be found below.
List of Common Business Deductions
Tax Fees
There are two types of taxes that the self-employed must pay. The first one is the Self-employment tax. This is basically a social security and medicare tax for people who work for themselves. You do not need to pay this if your total income was less than $400. You can read more about this here:
Self Employment Tax
The other type of tax is the Estimated Tax. According to the IRS there are two general rules that determine if estimated tax is owed:
- You expect to owe at least $1000 in tax for 2008 after subtracting your withholding and credits.
- You expect your withholding and credits to be less than the smaller of;
90% of the tax to be shown on your 2008 tax return, or
100% of the tax shown on your 2007 tax return. Your 2007 tax return must cover all 12 months.
You can find more information about this topic below.
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