I started a small business and my income from that business was 8000,do i need to file a federal tax?

Answer 1

Of course you do! If you have $400 or more in self-employment income you must file.

Answer 2

It is smart to do so because you have to file an income tax anyway, and you can write off a lot when you file a small business tax form. It is also really smart to have a CPA do it for you because you will only pay tax on the net profit at the bottom line....you don't want to pay it on $8000.

The question is do you have another job as well. Are you married, etc. You file it all together under one Income Tax....but right now you can file an extension form until fall which gives you some time to get it done right.

We used a part time business or a full time one for all our lives....and just having a part time one...along with a regular job will save you a lot in taxes because you can write off so much, and it is a great way to get started.

But yes...$8000 is income....but do it right so you won't have to pay taxes for all of it.

CPA's fees differ....but usually for a small business they don't charge as much and will save you a lot...so it is worth the fee.
We have paid one $180 a year....so look for one that is reasonable.

I have encouraged my own kids to have a side business because of the tax benefits. When you move, however, to a full time business there are pitfalls you need to know...like be sure to put away retirement money...because you will only get the very minimum in social securtiy, even though you have to pay into it. We found that out the hard way!

Answer 3

Even if your business generated 0, you still need to file Federal and State taxes for it.

If your income was 8000, but you had a net loss counting your business expenses, you are passing on possible tax benefits.