I Just Started A New Business Venture, Now What?
First off, congrats! Beginning your own business is an exciting and rewarding experience. But now, let’s get down to business (pun intended). Luckily, the IRS has put together a suggested list of what needs done with regards to federal taxes in order to prepare for your opening day.
To begin, you should register for an FEIN (federal employer identification number). This is the number used to identify your business with the IRS and if you choose to obtain funding from a financial institution, it’s likely that they’ll also want to know your FEIN. Also, if you have employees, you should ensure that they fill out their tax forms such as their W-4 and I-9.
You should also expect to choose a tax year, which is an accounting of your recordkeeping and reporting income. A tax year is either viewed as a calendar year or a fiscal year. A calendar year is 12 consecutive months beginning on January 1 and ending on December 31, whereas a fiscal year is viewed as 12 consecutive months ending on the last day of any month other than December. Next, you should determine how you want your business to be taxed. You have various options, such as a sole proprietorship, partnership, corporation, or an s-corporation. If you’re unsure of which tax year or structure is best for you, contact a tax professional such as the ones at The Center for Financial Legal and Tax Planning.