Starting a Small Business

10 Tax Forms All Small Business Owners Should Know

10 Tax Forms All Small Business Owners Should Know

While individual taxes are generally due annually in April for American taxpayers, most small business owners pay quarterly estimated taxes throughout the year. This means that taxes, and tax documents, are a year-round concern.

Depending on the nature of your business, there are different IRS forms you will need to file. Your tax preparer can help you understand which forms are required in your situation but doing your own research is also wise. The more you know about small business taxes, the easier it will be for you to have educated conversations with your tax professional.

Here, we take a look at the top 10 IRS tax forms every small business owner should know.

GettyImages-1137415864
Photography by Phillip Rubino / Getty Images via Getty Images

IRS Form 720 is the quarterly excise payment form. Businesses pay federal excise tax on specific goods and services manufactured or imported into the United States. Generally, excise tax obligations are incurred when something is manufactured, not when it is sold.

Motor fuel, tobacco, and alcohol are the most common substances to require excise tax payments.

IRS Form 940 is the Employer’s Annual Federal Unemployment (FUTA) Tax Return. This document only needs to be filed once a year, and reports the amount of money employers pay into unemployment insurance.

Note that FUTA payments must be made quarterly even though Form 940 is filed annually.

IRS Form 941 is the Employer’s Quarterly Federal Tax Return. On this form, business owners must report payroll information in regard to salaries for all employees, additional wages, tips, and taxes. The form also lets employers pay their portion of Social Security and Medicare taxes.

GettyImages-1205818979
Constantine Johnny / Getty Images via Getty Images

IRS Form 1040 is arguably the most well-known tax form in the United States. This is the Individual Tax Return. Although it is not business-specific, nearly all American business owners have to file this form in order to report their personal income.

Form 1040 can be used to report an individual taxpayer’s profit and loss, but it doesn’t generally cover sole proprietors. Self-employed small business owners can use different schedules to provide the necessary information to the IRS.

The most common schedules are Schedule C, Schedule SE, and Schedule ES.

IRS Form 1065 is the U.S. Return of Partnership Income. Any business owner who is part of a partnership or mult-member LLC must file this form on an annual basis. Form 1065 is also known as Schedule K-1.

IRS Form 1099-NEC must be filed by independent contractors who earned $600 or more during a tax year. Prior to the American Rescue Plan of 2021, contractors were only required to report their income if they earned over $20,000.

Now, third-party sellers on online marketplaces like eBay, Mercari, and Poshmark need to be mindful of their earnings as they might be required to pay taxes on their income.

If you are required to file Form 1099-NEC, you might also need to file Form 1099-DIV, Form 1099-INT, or Form 1099-MISC. Talk to your tax advisor if you have questions.

[img – we have some of people opening packages/packages being delivered that might be good here if Zoe has gotten them uploaded]

IRS Form 4562 is used to report depreciation and amortization on specific assets, including listed property. Among the types of property commonly claimed on this form are:

Equipment and machinery, such as construction equipment

Furniture and fixtures

Improvements made to rental property

Buildings, such as commercial and agricultural structures

Loan expenses and other intangible assets

IRS Form 7004 is used by business owners who need an extension to file their taxes. This grants an automatic extension. Note, however, that a separate Form 7004 must be filed for each tax return for which the business owner is requesting an extension.

Form 7004 is used to request extensions for:

Form 706-GS(D)

Form 706-GS(T)

Form 1041

Form 1041-N

Form 1041-QFT

Form 1041

Form 1065

Form 1066

Form 1120

Form 1120-C

Form 1120-F

Form 1120-FSC

Form 1120-H

Form 1120-L

Form 1120-ND

Form 1120-PC

Form 1120-POL

Form 1120-REIT

Form 1120-RIC

Form 1120S

Form 1120-SF

Form 3520-A

Form 8612

Form 8613

Form 8725

Form 8804

Form 8831

Form 8876

Form 8924

Form 8928

GettyImages-1400799758 (1)
MoMo Productions / Getty Images via Getty Images

IRS Form 8829 is used to deduct expenses associated with the business use of your home. It must be filed with a Schedule C form. It is worth noting that the IRS has very strict rules regarding home office deductions, so make sure you work closely with your tax preparer when filling out this form.

IRS Form SS-4 is used to obtain an employer identification number (EIN). This nine-digit number is a government-issued ID assigned to employers, sole proprietors, corporations, and partnerships for tax filing and reporting purposes.

You need to obtain a separate EIN for each new business you start.

GettyImages-1432978385 (1)
Oscar Wong / Getty Images via Getty Images

This is just a sampling of 10 of the most important tax forms business owners should be aware of. Before filing your taxes, you should consult with a qualified tax professional in your area.

share this post
Search for matches...
Frank Jenkins Jr

Frank Jenkins Jr

Frank Jenkins Jr. is the managing partner of Adams, Jenkins & Cheatham, a CPA practice based in Midlothian, VA. Frank specializes in Consulting services, tax planning, accounting, audit & assurances. "I genuinely care about our clients because I have a personal connection with them. This job requires me to multi-task and work under tight deadlines. I get great professional satisfaction from balancing firm and client commitments while building a strong team here at AJC."

ADAMS, JENKINS & CHEATHAM
0 reviews

Virginia

Recommended Professionals

In the face of economic uncertainty, TaxBuzz is the industry's most up-to-date tax information.

Join 60,000 who get our weekly newsletter. No spam.

We know tax and accounting issues are complicated.

Do you have additional questions on this topic for this author?

Related Posts

Latest Posts