Filing taxes as a small business or as self-employed? If you aren’t using a sole-proprietorship business structure, chances are you are filing as an Limited Liability Company, or LLC.
If so, the IRS has a guide for filing as an LLC. Basically, for purposes of Federal Income taxes, there is no such thing as an LLC. Either you are a sole-proprietorship or you are a partnership or corporation for tax purposes. However, this status does not affect your legal status as a LLC for purposes of liability and other state related laws.
If you are self-employed or employed in a small business with your spouse, go for the sole-proprietor method since it is much easier. This way, you just file your Schedule C on your Form 1040 and you are off.
If you have employees or are in a partnership with a non-spouse, then you’ll probably need to go the partnership or corporation route. Of course, then the Schedule C isn’t good enough, you’ll need a Schedule K or other form to report your share of the profits and expenses.
Keep it simple if you can and file your LLC as a Schedule C.
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Related posts:
- Free Small Business Accounting Software Microsoft Money Home and Business
- More Tax Deductions for Small Business Owners and Sole-Proprietorships
- 2008 Last Minute Tax Filing Tips
Tags: 2008 Taxes, Small Business, Tax Tips Tricks
