Business Taxes


Just like an individual, businesses must pay several different kinds of taxes, some easier to understand than others. Taxes for businesses come in several varieties a tax advisor from Infinite Financial Services can help you best understand them.

Depending on various business activities, like selling taxable products or services, using equipment, owning business property, being self-employed versus having employees, and of course, making a profit, different tax categories and applications also apply.

Call an IFS business tax specialist today. We can answer all your tax-related business questions and if necessary, recommend services that can get your business tax circumstances on track now!

If you are just starting your business, you need to know what taxes you’ll be expected to pay. If your business has changed—if you have bought property or started hiring employees, for example—you’ll need to know about the taxes associated with these activities.

If you’re a small-business owner, you’ve probably heard of the 2018 tax bill—also known as “Tax Cuts and Jobs Act.” This bill has not only changed individual taxes, but it’s also reformed corporate taxes in the U.S.—especially for small businesses—making this one of the best times to start that side hustle you’ve been dreaming of.

Under the new law, taxpayers with pass-through businesses like these will also be able to deduct 20% of their income on their taxes. In other words, if you own a small business and it generates $100,000 in profit in 2018, you’ll be able to deduct $20,000 before the ordinary income tax rates are applied.

The pass-through income deduction isn’t the only benefit making this a great time to start your small business. Before the new tax plan, when a business owner claimed new equipment as a loss to get a tax break, this tax benefit was spread out over several years. So, small-business owners didn’t receive the full benefit for multiple years. Under the new tax law, small-business owners get the deduction right away.

This makes pouring some cash into your small business much more appealing. And the more you can invest in your business, the more efficient you can become and the more profits you can make!

6 Reasons to Speak to IFS about Your Business Taxes

Business Taxes are Complex

Even simple tax situations can be complex, especially if the person owns a business or receives income from one, has children, has recently divorced, received a Form 1099, had income from a state you don’t live in, or moved.

Adding to the complexity, new tax laws are enacted every year that affect virtually everyone, making it tough to keep up with changes and how they might affect you. For small businesses that have to manage income tax withholding and reporting for its employees, taxes are even more complex, and then there’s healthcare reporting.

While tax software can help, an experienced tax pro from IFS  “has seen it all before,” and also keeps up with tax law changes through educational courses.

Your Time is Money

While you may be able to prepare your taxes yourself for $150 or less online, many do-it-yourself filers spend an inordinate amount of time doing it and that is time your business needs you at the helm!

Hiring an IFS  tax pro can reduce that to the time it takes to gather your tax documents and forward them to his or her office, develop a tax strategy for your business and obtain your business a max-refund!   Your time is better spent with growing your business during those early days of spring, and hiring an IFS  tax pro can make for sunnier days.

Mistakes Will Cost You

If you do your taxes yourself, you are much more likely to make mistakes … and they can cost you big. Even simple math errors can cause a return to be inaccurate, leaving the taxpayer liable for past taxes and interest.

For errors the IRS believes are not accidental, such as failing to report income, taxpayers can also face large fines and even criminal prosecution.


A Tax Pro Saves Money

In addition to saving you hours and hours of painfully boring and perilous tax guessing, the experienced tax preparers at Infinite Financial Services also know all of the deductions that you may qualify for, and which items are tax deductible if you own a business. An IFS Tax advisor can also easily tell you whether it’s more beneficial to itemize or take the standard deductions.

Even if you just earn a little extra income on the side, an IFS  tax pro may be able to find you deductions or credits that will more than pay for their services and keep more of your hard earned money in your pocket. Or get Uncle Sam to send more of it back in a tax refund. To top it off, the cost of having your business taxes prepared by an IFS tax professional can also be tax deductible.

Peace of Mind

Have you ever finished your taxes and were pleased with the income tax refund amount, but were less than confident in the accuracy of the return? Or if a particular deduction or credit really applied to you? The only people that look forward to an IRS audit are IRS auditors, and the best way to avoid their scrutiny is to make sure your tax return is in compliance with the tax laws.

The best way to do that is to hire an IFS professional who lives, works and breathes taxes every day (or at least a lot more frequently than you do).

There is still a chance than any taxpayer will get audited, but if you use the services of a professional CPA, Enrolled Agent or Tax Attorney, and your return is selected for further inspection by the IRS, those professionals will help represent you on your behalf before the IRS.

Don’t go before a court without a lawyer, and don’t go before the IRS without an IFS  tax pro in your corner.

Planning Ahead

The business taxes you pay this year can affect the business taxes you will owe next year- so it is best to look at the larger picture- and plan ahead for those events that you can plan.

At Infinite Financial Services, our  tax professionals would like you to meet with them before it’s time to do your taxes, while there is still time to take proactive steps to reduce your taxes or minimize other effects. A tax planning and strategy meeting can result in significant savings for many taxpayers and businesses.


Tax Types Businesses Must Pay

All businesses must pay tax on their income; that is, the business must pay tax on the profit of the company (the income of the business less deductible expenses). How that tax is paid depends on the form of the business.

Small businesses (sole proprietors and single-member LLCs), partners in partnerships, and S-corporation owners pay taxes through their personal income tax returns. The concept – called pass-through tax – is the same for all of these business types.

Sole proprietors and single-member LLC members pay taxes by filing a Schedule Cincluded with their personal return

Partners in partnerships and multiple-member LLC owners file a partnership business tax return for information purposes only. The individual partners or LLC members pay income taxes their share of the income of the business, by including this income in their personal returns.

Businesses don’t directly pay sales tax on products and services they sell. But if your business operates in a state that has state income tax, you must set up a system to collect, report, and pay state sales tax.

Merchants in most states are required to collect sales tax and pay it to the state department of revenue. Specific products and services are sales-tax eligible, depending on state laws. Money must be collected from customers, reported, and paid on a regular basis.

Don’t forget sales taxes for items you sell online, which many states now are requiring for specific types of sellers.

Partners in partnerships and multiple-member LLC owners file a partnership business tax return for information purposes only. The individual partners or LLC members pay income taxes their share of the income of the business, by including this income in their personal returns.

If your business owns real property (real estate), like a building, your business must pay property tax to the local taxing authority, which is usually the city or county where the property is located.

The tax is based on assessed value, same as for personal property like a house. There are special considerations for paying property taxes when you sell a piece of business property (capital gains taxes may have to be paid, and you should consult with a tax professional for such matters.

Partners in partnerships and multiple-member LLC owners file a partnership business tax return for information purposes only. The individual partners or LLC members pay income taxes their share of the income of the business, by including this income in their personal returns.

Excise taxes are paid by a business for certain types of use or consumption, like fuels, and other activities like transportation and communication.

Excise taxes are paid to the IRS, either quarterly or annually, depending upon usage, using Form 720.

Self-employment taxes are those paid by sole proprietors and partners for Social Security and Medicare, based on the income of the business.

Because business owners are not employees, there is no pay to withhold these taxes from, so self-employment tax is the alternative.

LLC owners also must also pay self-employment tax. Owners of corporations who work as employees do not have to pay self-employment tax.

Because you are the owner of a business, no one withholds income tax and self-employment tax from the money you take out of the business. (You don’t get a paycheck, remember, because you aren’t an employee.)

The IRS requires that these tax be paid throughout the year, so you must pay estimated taxes quarterly. The first payment of the year is due April 15, then again on July 15, September 15, and January 15 of the following year.

The estimated tax form for business owners combines business and personal income and taxes, including self-employment taxes.

Like sales taxes, some employment taxes are collected, reported, and paid. In this case, the taxes are paid to the IRS and the Social Security Administration.

Employment taxes are those paid by the owner of a business for several types of taxes based on the gross pay of employees. These include FICA taxes (for Social Security and Medicare), federal and state unemployment, and federal and state workers compensation taxes.

Some of these taxes (unemployment tax, for example) aren’t collected from employees, and they must be paid completely by the employer.

Most states have a state income tax for businesses. But some states, like Nevada and Texas, impose a gross receipts tax on businesses instead of a state income tax. In these states, gross receipts (revenues) of the business are taxed. Some states allow deductions for this tax, and some types of businesses are exempt in some states.

Sole proprietorships are usually exempt from paying gross receipts taxes, but not from state income tax.

Corporations and LLCs are most likely to pay gross receipts taxes, determined by the fiducairy laws of the state in which they are located.

Some states charge franchise taxes to corporations based on the value of the company. These taxes are similar to a state income tax or a gross receipts tax. Sole proprietorships are not typically subjected to a franchise tax.

If you are an owner of a corporation, you are a shareholder. That means you pay income taxes on income you receive from dividends.

how can we help you?

Contact us at the IFS office nearest to you or submit a business inquiry online.

You helped my family professionally twice and I am very pleased with your work ethic. Our experience at IFS was great! Thanks guys!

Richard Fernandez
Miami, FL

Preparing For Your Business Tax Interview


If you want to stay on top of your small business taxes, you need to carefully prepare with an IFS tax professional  in advance of any filing deadlines.

The process of having your small business taxes filed is much easier if you take time to prepare all your small business’s financial documents and records before your tax interview rolls around. The reason is simple: if you’re scrambling to get everything together a few days before a business tax deadline, you’re setting yourself up for disaster.

Here’s what you’ll need to gather:

  • Last year’s business tax return
  • Payroll documents
  • Bank and credit card statements
  • Accounting documents
  • Partnership agreements
  • Depreciation schedules

When you sit down to file your small business taxes, make sure you have these financial documents on hand.

And because you’ll have to make a thorough accounting of all income and expenses associated with
your small business, it will help if you’ve saved these documents, too:

  • Gross receipts
  • Checking and saving account interest
  • Returns and allowances
  • Sales records
  • Unclassified income
  • Employee wages
  • Insurance premiums
  • Professional fees
  • Contractor payments
  • Office rent (or portion of the rent or mortgage paid on your home)
  • Transportation and travel expenses
  • Advertising costs
  • Office supplies and equipment
  • Phones and other communication devices

If you keep hold of all these receipts and documents, you’ll have a much more accurate income and expense statement when it comes time to file your business tax returns. Most of these income and expense categories should be easy to locate on your business accounting software or from your accountant.

If you are having trouble, an IFS tax professional will be happy to assist you.

Review Your Business Tax Needs With Us Today

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