Six Tax Tips for New Business Owners!

Are you opening a new business this summer? The IRS has many resources available for individuals that are opening a new business. Here are six tax tips the IRS wants new business owners to know.

1. First, you must decide what type of business entity you are going to establish. The type of business entity will determine which tax form you have to file. The most common types of business are the sole proprietorship, partnership, corporation and S corporation.

2. The type of business you operate determines what taxes you must pay and how you pay them. The four general types of business taxes are income tax, self-employment tax, employment tax and excise tax.

3. An Employer Identification Number is used to identify a business entity. Generally, businesses need an EIN.

4. Good records will help you ensure successful operation of your new business. You may choose any recordkeeping system suited to your business that clearly shows your income and expenses. Except in a few cases, the law does not require any special kind of records. However, the business you are in affects the type of records you need to keep for federal tax purposes.

5. Every business taxpayer must figure taxable income on an annual accounting period called a tax year. The calendar year and the fiscal year are the most common tax years used.

6. Each taxpayer must also use a consistent accounting method, which is a set of rules for determining when to report income and expenses. The most commonly used accounting methods are the cash method and an accrual method. Under the cash method, you generally report income in the tax year you receive it and deduct expenses in the tax year you pay them. Under an accrual method, you generally report income in the tax year you earn it and deduct expenses in the tax year you incur them.

To Read More : Six Tax Tips for New Business Owners!

Source : Business Documents Filing in 50 States

NYS Department of Taxation and Finance- Excise Tax on Cigarettes to increase on July 1, 2010 Cigarette floor tax returns must be filed by September 20

Retail dealers, wholesale dealers, and cigarette stamping agents must pay the increased tax on all stamped packs of cigarettes and UN affixed tax stamps in their possession as of the close of business June 30, 2010.

To comply with the new requirements:

• Dealers and agents must take a physical inventory of all stamped packs of cigarettes on hand as of the close of business June 30, 2010.
• Agents must also take a physical inventory of all UN affixed cigarette tax stamps and UN stamped packs of cigarettes on hand as of this date.
• Dealers and agents must file a cigarette floor tax return by September 20, 2010, and pay a cigarette floor tax. Cigarette excise tax increase (effective July 1, 2010)

Inventory:

Retail dealers, wholesale dealers, and stamping agents, please note:

• If you store or sell cigarettes at more than one business location, you must keep the original inventory report at each location for inspection.
• You must keep all records of the physical inventory used to arrive at the cigarette floor tax due. You will have to produce these records if you are audited by the Tax department.
• You must take your own inventory. You may not rely on the random inventory counts made by Tax Department personnel.

Vending machines:

If you operate cigarette vending machines, it may not be possible for you to conduct a complete physical inventory as of the close of business June 30, 2010. You may calculate your Inventory in the following way:

• Take a physical inventory of as many locations as you can with your available personnel.
• For vending machines that cannot be inventoried as of June 30, 2010, calculate your inventory at one half the machine’s normal fill capacity.
• Base the machine’s normal fill capacity on its individual inventory records.

If you are an agent, you must also calculate the floor tax due on UN affixed cigarette tax stamps and indicate the quantity of unstamped packs of cigarettes possessed as of the June 30, 2010, inventory.

Multiple locations:

If you are a retail dealer, wholesale dealer, or cigarette stamping agent who stores or sells cigarettes at more than one location:

• File one consolidated cigarette floor tax return including inventory from all locations.
• Report the inventory of stamped packs of cigarettes at each separate location.

Payment:

You must pay the entire amount due when you file Form CG-11 on or before September 20, 2010.

Penalties and interest:

Retail dealers, wholesale dealers, and cigarette stamping agents who are subject to the cigarette floor tax must file a return and pay the tax due by September 20, 2010. Failure to file a cigarette floor tax return or to pay the appropriate tax due by the due date:

• Will subject you to the imposition of interest and civil penalties under Article 20 of the tax Law, and
• May result in criminal penalties under Article 37 of the Tax Law.

Amount of penalties:

Cigarette stamping agents – Penalties imposed on agents are based on the period of time for which a return remains UN filed or the tax remains unpaid.

To read more! NYS Department of Taxation and Finance- Excise Tax on Cigarettes to increase on July 1, 2010 Cigarette floor tax returns must be filed by September 20, 2010! Source: InfoTaxSquare Business Documents Filing In All Fifty States!

Who Must File Florida's Corporate Income Tax?

Corporations and artificial entities that conduct business, or earn or receive income in Florida, including out-of-state corporations, must file a Florida corporate income tax return unless exempt. They must file a return, even if no tax is due.

Sole proprietorships, individuals, estates of decedents, and testamentary trusts are exempted and do not have to file a return.

Corporations and other artificial entities, including those located in other states, that are partners in a partnership or members of a joint venture doing business in Florida must file the Corporate Income/Franchise and Emergency Excise Tax Return. A partnership must file a Florida Partnership Information Return if it is doing business in Florida and a corporation is one of the partners.

To read more! Who Must File Florida's Corporate Income Tax? Source: InfoTaxSquare Business Documents Filing In All Fifty States!

Excise Tax On Tanning Services

WASHINGTON — The Internal Revenue Service today issued regulations outlining the administration of a 10-percent excise tax on indoor tanning services that goes into effect on July 1.

The regulations were published today in the Federal Register.

In general, providers of indoor tanning services will collect the tax at the time the purchaser pays for the tanning services. The provider then pays over these amounts to the government, quarterly, along with IRS Form 720, Quarterly Federal Excise Tax Return.

The tax does not apply to photo therapy services performed by a licensed medical professional on his or her premises. The regulations also provide an exception for certain physical fitness facilities that offer tanning as an incidental service to members without a separately identifiable fee.

To read more! Excise Tax On Tanning Services Source: InfoTaxSquare Business Documents Filing In All Fifty States!