Startup Tax – All the taxes your startup needs to pay for 2019
Startup founders, tax filings can be stressful, but don’t worry, we have spent some time and prepared a list of the most common taxes you will need to pay! Fortunately, this article is only a 2 minute read and should help you save some time! Feel free to use the list below as a simple checklist.
First off, there are two most common taxes you will need to be pay the federal level, they are:
Company annual tax return
Payroll taxes
Next up, State tax which is a direct tax on your income which is levied by the state:
Franchise tax
Give you couple examples for franchise taxes: the franchise tax for California is $800 per year; the franchise tax for Delaware is depend on your company assets and the shares you issued.
Payroll taxes
Sales taxes to the sate
You don’t pay sales taxes to government, instead you collect sales tax from your customers and remit it to the government. You simply serve as a collection agency here.
Finally, City or county taxes:
The taxes to cities or counties vary widely, here are the two most common taxes:
Sales taxes to the city/county
Property tax
Depending on your industry and location, you might also have some other taxes that you are liable for, but as always, be sure to consult with your CPA on any type of tax you might not be aware of. Better safe than sorry right?
We want to help you minimize the stress from filing taxes and be prepared if any unforeseen circumstances were to arise. Here are a couple common scenarios that might just help you avoid some headaches:
Scenario 1 - What if you missed the deadline to file the tax?
The rule of thumb is this: if you are under pressure with time, you should submit an estimated tax payment on/before the deadline, and then submit the paperwork for tax filing after. The reason is that if you made the payment late, you are liable for late fees and interest, we all want to be frugal and try to avoid these unnecessary expenses. In contrast, if you are late for filing paperwork for the tax, you can possibly get an extension to file. After all, the government is like a business and needs to get all the payments in on time (they have deadlines too you know).
Scenario 2 - What if your previous years’ tax returns are wrong?
Take a deep breath and understand that not all hope is lost. You will need to submit an amendment for previous years’ tax filing to make any corrections on your returns. If your CPA tells you that they need to do previous years’ tax amendments, they are right. They will need to correct the previous mistakes first, before they can work on the current year’s tax filing.
We did a quick rundown on the types of taxes you will need to pay for 2019 and couple possible scenarios that could happen and how you can deal with them. If you still have any burning questions, feel free to drop us a line. We are here to help!
