How to pay state and federal income tax on home based business?

Answer 1

For federal, you'll need a schedule C (or C-EZ) where you'll list your business income and expenses. Will probably also need Schedule SE to calculate self-employment taxes (covers social security and medicare taxes). Numbers from these schedules go on your 1040.

For state, each state is different.

Getting an accountant, especially for at least the first year so you can see how it's done, would be a real good idea.

Answer 2

You file your income tax as self employed. I always use Turbo tax and it asks all the pertinent questions and fills out the worksheets and forms for me. I haven't had any problems and have used it for about 5 years. If you aren't sure about using Turbo tax a CPA will be able to handle all your paperwork.

Answer 3

Well, it not hard thing to do, you can do it your self but if you don't want any kind of hessle, then sure get a CPA, I am a Self employed and my CPA does all for me, I pay the guy about $125/every 3 months. See if you can get get a better deal. if not then try the one I use.

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Answer 4

The IRS has a thing called "Estimated Tax Payments" This is where people who are self employed can pay their taxes quartly instead of anually

http://www.irs.gov/taxtopics/tc306.html

Maybe this will help

Answer 5

just send me the money, i'll take care of it :D

You need to summarize things like sale & expances and then file income tax return as self employed.
I am self employed, my accountant takes care of it, I would never do it by self.

Answer 6

File it under your social security number.

Answer 7

Get a CPA. It will save yopu money and jail time.