If you are rather new to the field of business and you are the owner of a small business, you might be solely focusing on the tax on your profit at the moment. Unfortunately, there are more taxes to worry about, and these next few liens will shed the light on some of the most important small business owner taxes.
Employment Taxes Wages
In case you are the owner of a C or S corporation, your own salary and also the rest of the taxable fringe benefits will be subject to FICA; the same goes for any compensation that might be paid to the rest of your employees. Keep in mind there will be no differences between the rank and file employment payments and he owner payment taxes.
Taxes On Self-Employment
The Social Security and Medicare taxes on the net earnings from the profits originating from self-employment are the main types of taxes you will have t pay. The Medicare tax features no limits and it is applicable to all profits. Here are also cases when profits that are high enough will trigger extra taxes that will need to be covered also; for example, 0.9% on a profit bigger than $250,000 for married people who file jointly, or $200,000 if you are single. There are cases when you might also have your own side business, being involved in online casino affiliate programs or something similar, and at the same time be the employer of a separate company. If this applies to you, know your self-employment tax will be reduced to the Social Security tax on wages from your workplace.
Unemployment Taxes Imposed On Employers
The tax works at a federal and state level and it funds unemployment benefits for fired or laid off workers. The federal unemployment tax is detailed in the instructions to Form 940.