If I have my own business part time what can I deduct for taxes?

Question

I also have a regular job. Should I combine my income from my job and business or seperate them?

Answer 1

1. You don't have any choice--you must report all your income (wages, business, interest, gains) on your tax return.

2. Your business income is your self-employed business. You must keep proper record of your self-employed income and expenses.

3. When you file your tax return Form 1040, for your business activity you need to complete Schedule C. On schedule C you record your income and expenses and the net income from schedule C is put on line 12 of Form 1040.

4. Your business income is also subject to self-employment taxes @ 15.3%. So make sure that you make proper estimated tax payments.

Answer 2

When you do your tax return at the end of the year, you'll combine them before you calculate your total tax.

Since you don't give any numbers, there's no way to tell what you'll owe in taxes on the business. It will most likely be 30-40% for federal, around 15% for self employment tax for social securiy and medicare, the rest for income tax. If you are in a bracket higher than 25%, then it could be higher. If your state has an income tax, that would be additional.

Answer 3

The IRS allows you to deduct expenses that are 'ordinary and necessary' to run your business.

Ordinary means something that is customary in the business you are running. Like having a telephone, renting space, buying supplies, advertising in the paper, etc.

Necessary means - well, you needed to do it for the business.

Some expenses (like meals) are only partially deductible.

an earlier poster did a great job explaining what forms you need.