The Small Business Tax Help Blog

Posts Tagged ‘irs’

Question: Where to get an EIN?

I have seen the actual form SS-4 on the IRS site and I know for a fact I will make a lot of mistakes. So I need a company or just someone who can fill it out, and obtain it for me, I have seen several sites online such as Legal Zoom and Mycorporation and their prices to do such simple task are outrageous! Hope someone can recommend something. Many points!

Answer: First off, are you sure you really need an EIN? Read IRS “Do you need an EIN” to determine if you need it or not http://www.irs.gov/businesses/small/article/0,,id=97872,00.html

Try to set up an appointment with SCORE or SBDC in your area. But don’t ask for an appointment merely to help fill out the form. Request for strategic consultation with your business, and then mention the EIN to them.

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Question: Tax question (self-employed)?

I realize this is grossly oversimplified, but I’m looking for a very very approximate estimate.

I am self-employed, I have no employees and minimal business expenses. About what percentage of my income will I owe in taxes?

Answer: That depends entirely on the amount of income you have earned. It could be a fairly wide range from 0% to over 30%.

But to give you an idea lets say you earned 50,000 of self-employment income, are single and used standard deductions.

You would have 7,650 of self-employment taxes and 5,394 of income taxes (accounting for a deduction of 1/2 of SE taxes)

Total tax would be $13,044.

This represents an effective tax rate of 26%

This is a higher effective tax rate from a person employed by someone else. Assuming everything else was equal, that person would have 3,825 of employment taxes and 6,350 of income tax.

Total tax would be: 10,175

This represents an effective tax rate of 20.3%

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Question: My child care provider will not give out their EIN without obtaining my SSN?

I asked for my child’s daycare EIN and they will not give it to me unless I give them my SSN along with my full name and the amount I am claiming. Is this normal? This is the first time I have ever used this credit and it doesn’t sound right to me.

Answer: Not normal. You need to make a best effort to obtain the EIN, but if they won’t give it to you you can still file for the credit. Document that you made the effort but they would not release the information.

Provider refusal. If the provider refuses to give you the identifying information, you should report whatever information you have (such as the name and address) on the form you use to claim the credit. Enter “See Attached Statement” in the columns calling for the information you do not have. Then attach a statement explaining that you requested the information from the care provider, but the provider did not give you the information. Be sure to enter your name and social security number on this statement. The statement will show that you used due diligence in trying to furnish the necessary information.

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Question: I need the form to fill out an estate for my dad who is deceased.?

My stepdad past away he had no beneficiaries so as the stepdaughter iwas told to make an estate for him on his behalf. I don’t know what form to use.I do know his EIN number. Please help thank you.

Answer: A form is not important; an analysis is what the court wants.
They wish to know what to tax the estate and how to
divvy up any assets. I do not think the court asked you to
make an estate but instead, to identify what is IN HIS estate.
You can’t “make” one. An estate is what one owns.

Die Immobilienmaklerin – ein Loft

Question: steps to make my business a legal one?

Even though I have read and read about how to open your own business, I am still very confused as to what the steps are.
I know I need to open an account with the SBA. I know I need to register the name with my state. I know I need a tax id or EIN # (is there a difference between the 2).

What is the first thing I would need to do? How much would it cost my business to do all this?
To be more specific, me and my partner are working together as photographers and we would like to make it legal. We don’t have a set location, as we work on the location the client chooses.
Please if you have any information you can provide, I would really appreciate it.
And please refrain from looking this online and give me links. I need real information from people who know what they’re talking about.
Thanks in advanced.

Answer: You don’t need to do the account with the SBA but you do need to register with the state you live in. A form will be needed that you write down the name of your business, who the owner is, if you’re a sole proprietorship or a partnership, etc. And you get an EIN# which is your tax ID (at least it is for PA and WI).

Here’s info for each state, it actually works very well (yes, I know you said not to send any):

http://www.sba.gov/hotlist/license.html

Every state differs. Since I sell at events or out of my home via internet sales, I needed a mobile sellers permit. A mobile sellers permit in WI cost me $10, it renews automatically each year for free, and I owe sales tax at the end of Jan. for the previous year.

A mobile sellers permit for PA where I do one event cost me $15 and renews automatically for free, but I have to file sales tax twice a year.

I just contacted the IL revenue dept. this afternoon about getting a business license to do one show down in Chicago in November–he walked me through the website and I printed out the 4 page form, state sales tax on that is due every month, but since it’s a one time event I just need to call after the event and suspend the license till I need it in IL again. It’s a free thing with IL, which is good, it offsets me having to report zero taxes collected for the other 11 months and I don’t have to worry about upkeep of the license.
This was the main site he guided me towards:

http://business.illinois.gov/tax_info.cfm

Then he had me search for the form REG-1 which is the request for a business license (here) —

http://www.revenue.state.il.us/taxforms/reg/reg1.pdf

That was all I needed to get started in Illinois. Free, easy, just fill out the 4 pages and send it in.

For a ‘brick and mortar’ actual physical store or rental property to work out of, you have to check with your local city ordinances about licensing and fees, inspections (by the fire dept. mostly), etc.

Open yourself a business account at the bank and get checks for that. That keeps your personal finances separate from the business ones.

And a tax preparer can help you with the forms at tax time.