Any business that employs others should also ask their tax lawyers about payroll taxes.
Arlington, TX – The early stages of starting a small business can be stressful and confusing. There are a number of different rules and regulations to follow depending on the industry, and the business will need to pay various kinds of taxes. Lawyers can be a great asset in these early stages to let the owners know about relevant tax rules and other matters that can be important. A business that pays its taxes properly can avoid problems with the IRS and lost money due to things like fines, late fees, and interest. Here are a few important points about paying taxes for small businesses.
Taxes on profits and earnings
As a general rule, businesses should expect to pay taxes on their net profits and earnings after losses and expenses are subtracted. The specific amount can vary greatly depending on how much the company actually made, but it usually comes out to somewhere between ten to thirty percent. Accountants and Arlington tax lawyers can advise a business regarding the specific amount they will owe if they have access to the company’s financial information and any relevant expenses.
Is a business subject to the corporate tax?
This can depend on a few different factors. Many small businesses are not started as corporations, and they are taxed based on the earnings of the owners rather than the standard corporate tax rate. If the company is a corporation, the owners may be taxed both personally and have to pay the corporate tax as well if they are considered employees of their own company. Texas tax lawyers should be contacted when a business is being started to decide on the structure that will create the best tax situation and meet the founder’s needs.
Businesses that have workers
Any business that employs others should also ask their tax lawyers about payroll taxes that need to be paid on the money that goes out to workers. These funds go to social security and Medicare. Workers will also need to be covered with some kind of workers compensation insurance or taxes in case of an injury, and this varies from state to state.
Preparing for the future
Some businesses may have years with little or no profits. This can help lessen the tax burden in those years, but the future of a business can also be in jeopardy if no money is coming in. Estate planning lawyers can help businesses set up investments such as trusts or other accounts to keep some money in reserve for bad years. However, these investments may be taxed under the capital gains tax depending on how they are used.
Locating the right lawyer for additional advice
USAttorneys.com is available to assist anyone who is searching for a lawyer in their area. They can provide referrals to attorneys in every state at 800-672-3103.