Estimated tax payments take the place of withholding from each paycheck and they must be filed on April 15, June 15, September 15, and January 15. In addition to income taxes, you will also be required to pay a quarterly self-employment tax, which covers your Social Security and Medicare payments. Furthermore, you must withhold income and social security taxes for any employees. In addition, if you sell a product, you will need to collect sales tax. There are certain tax advantages to owning a home-based business.
Many business expenses are deductible.
To be eligible, you must be engaged in an activity with the intent of making a profit, and you must show a profit in any two years of a five year period. Due to the complexity of the federal tax code, hiring an accountant or a tax attorney for guidance is recommended. Home-based businesses are subject to many of the same laws and regulations that apply to other businesses. You will need to register with your state and obtain a business license. Businesses in the home can be affected by zoning laws that restrict business activities in residential areas.