What do you have to do differently filing taxes if I get a tax id for a small business? Sole proprietorship
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What do you have to do differently filing taxes if I get a tax id for a small business?
#1 by Charles G on June 29th, 2011
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Your tax id for your business goes on Sch-C, instead of your SSN.
#2 by jo614 on June 29th, 2011
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You would set up a company and keep books and records in which you would record all of your income and expenses. At the end of the year, you would organize that information on a Schedule C and report it to the IRS. The biggest difference is that if you are self employed you will become responsible for paying all of your Self Employment tax which will total 15.3 percent of your profit. You will be required to pay this tax when you file your tax return.
Also, be careful with State sales tax if you state has sales tax. You must make sure you properly collect and remit the sales tax to the local authorities.