A Tax Season Follow Up for Small Businesses

By: Kenneth Wardle | Chief Executive Officer

Although you might be relieved that tax season and the annual April tax date have passed for this year, business owners also know their tax obligations continue around the calendar. From quarterly estimated tax payments to payroll deposits, there are deadlines and important paperwork due beyond the annual April 15th rush. Making a plan for the rest of the year with your accountant or tax professional will keep your business running smoothly and avoid cash flow issues as tax deadlines occur.

Here are some dates to keep in mind and additional resources to help your small business keep up with your tax responsibilities.

Deadlines

Estimate Quarterly Payments - Many small businesses, including sole proprietorships and freelancers, need to pay quarterly estimated taxes. You will need to file IRS Form 1040-ES and the appropriate state forms if you are subject to a state-level income tax. These payments are due on April 15, June 15, September 15, and January 15 of the next calendar year.

Quarterly Social Security, Medicare, and Income Tax Withholding - If you are withholding taxes for social security, Medicare and income tax for your employees, you will need to file either IRS Form 941 or 944 by April 30, July 31, October 31, and January 31. Check with your tax professional to see if you need to pay semiweekly or monthly and make sure your Electronic Funds Transfer (EFT) or Electronic Federal Tax Payment System (EFTPS) is up-to-date.

Information on Withholding - You will need to submit W-2 forms to each employee by January 31st. These forms provide your employees with important information for their own taxes, including salary and withholdings for social security and Medicare.

You will also need to submit W-2 and W-3 forms to the Social Security Administration by the end of January.

Also remember that 1099 Forms are due to any contract workers your small business used by January 31st. The IRS would like their copies of 1099 Forms by the end of February.

For any employers reporting employee Tip Income, Form 8027 is due by the end of February (or the end of March if filing electronically.)

Federal Unemployment Tax (FUTA) - Form 940 is due by January 31st if the liability is less than $500. If the liability is greater than $500, the due dates are April 30, July 31, October 31, and January 31.

State Requirements

Beyond quarterly state income tax payments, your small business may be responsible for state level taxes covering Worker’s Compensation, unemployment, and disability coverage. The Small Business Administration has compiled a list for each state HERE.

Helpful Resources

Here are some excellent places to learn more about the tax obligations and responsibilities for business owners. Preparing your business with the best information and working with your tax professional will help streamline taxes throughout the year and avoid fees and surprises.

IRS.gov - The Internal Revenue Service has several sections on their website dedicated to small business. Check out Publication 15 for detailed information about the deadlines and forms detailed above. Publication 334, Tax Guide for Small Businesses is required reading, too. Stay tuned to the IRS website for any revisions and updates. The IRS has also prepared a Video Workshop for Small Business Taxpayers.

SBA.gov - The Small Business Administration is dedicated to keeping business owners up-to-date and includes resources and tips for filing federal and state taxes.

SCORE.org - SCORE is a nonprofit association dedicated to helping small businesses. They offer mentoring and advice alongside their Tax Center of Excellence.

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