Tax season is upon us. It happens every year. What are the tax reporting guide lines to the IRS this year? According to the IRS Publication #17 IRS changes for 2010 the minimum reporting income amount for a business is net income of $400 or greater.
How you set up a business entity and how many business deductions that you report will impact which IRS form that you fill out. You will either fill out a Schedule C form or a schedule C-EZ depending if you meet the following criteria.
If you are a sole proprietor who reports less than $5,000 worth of business deductions, if your sole proprietor business has no other employees, or claims any part of your home as a business deduction. Other criteria include that you don’t carry any inventory for your business during the year. Those criteria will enable your business income and expenses to be report on the IRS schedule C-EZ Form. All other businesses need to report their income on IRS form schedule C. See the IRS Publication #334 Tax guide for small business at the web site http://www.IRS.gov.
According to the IRS publication form #17 changes for 2010 the total minimum income reporting guidelines are as follows; For a single tax payer under age 65 the total minimum income amount is $9,350, for a single tax payer over the age of 65 the total minimum income amount is $10,750. For the married filing jointly (MFJ) tax payers who are under age 65 the total minimum income amount is $18,700, for (MFJ) tax payers who are over age 65 the total minimum income amount is $20,900. For one spouse of (MFJ) tax payers over age 65 the total income amount is $19,800. For spouse who are married but filing separately the total minimum income amount is $3,600. For a head of household who are under age 65 the total minimum income amount is $12,000 and for head of household who are over age 65 the total minimum income amount is $13,450.
Here are some helpful IRS publications that you should review. IRS publication 334 Tax guide for Small Business IRS Publication 535 Business expenses, and IRS publication guide 587 Business use of your home. For research the IRS tax questions go to the IRS web site at => http://www.IRS.gov, or call their business and specialty tax help line at (800) 829-4933.
There are 5 business entities that you can select for your small business. Those business entity are Sole Proprietor, Partnership form 1065, (LLC) Limited Liability company, C Corporations, and S Corporations. It is advisable that you Research the following government agencies and private business organizations prior to your making your business decision upon selecting which type of business entity is suitable for your business venture. The Small business administration http://www.SBA.gov has a boat load of helpful information and free on-line course that you can take. Business.gov is the official business link to the U.S. government. It is managed by the SBA who is partnering with 21 other federal Government agencies.
Other government agencies that are useful and helpful include the Social security administration, the U.S. department of Labor, the Department of agriculture/ Office of Small & disadvantaged business utilization. Are you a veteran, take full advantage of the Department of Veterans affairs.
You can research your local chamber of commerce and also consult with a qualified legal attorney who specializes in assisting small business owners. There are thousands of qualified tax professionals who can also assist you in filing your taxes. You should not file your taxes alone with out doing the proper research. Help is on it’s way.