WHAT FORM SHOULD I USE FOR
FILING MY BUSINESS TAXES?
Here is a simple reference
table that may clear up the confusion:
Type of Business, Tax
Liability, Form to Use
Sole proprietor: An
unincorporated business that is owned by one individual.
Income Tax, 1040 and Schedule
C or C-EZ
Self-employment tax, 1040 and Schedule SE
Estimated tax, 1040-ES
Employment taxes:
State employment taxes, DE-6, DE-7, DE-88
Social Security and Medicare, income and withholding
taxes, 941 (943 for farm employees)
Federal unemployment (FUTA) tax, 940 or 940-EZ
Depositing employment taxes, 8190
Excise taxes
Partnership: The
relationship existing between two or more persons who join
to carry on a trade or business. Each person contributes
money, property, labor, or skill, and expects to share in
the profits and losses of the business.
Annual return of income,
1065
Employment taxes, same as sole proprietor
Excise taxes
Partner in a partnership
(individual)
Income tax, 1040 and
Schedule E
Self-employment tax, 1040 and Schedule SE
Estimated tax, 1040-ES
Corporation or S Corporation
Corporation: Prospective shareholders transfer money, property, or both
for the Corporation’s capital stock. A Corporation generally
takes the same deductions as a sole proprietorship to figure
its taxable income, and can take special deductions. The
profit of the Corporation is taxed to the Corporation when
earned, and then is taxed to the shareholders when
distributed as dividends. Shareholders cannot deduct any
loss of the Corporation.
S Corporation: An
eligible domestic corporation can avoid double taxation by
electing to be treated as an S Corporation. In general, an S
Corporation is exempt from federal income tax other than tax
on certain capital gains and passive income. Shareholders
include on their tax returns their share of the
Corporation’s separately stated items of income, deduction,
loss, and credit, and their share of non-separately stated
income or loss.
Income tax, 1120 or
1120-A (corporation), 1120S (S Corporation)
Estimated tax, 1120 or 1120-A (corporation), 1120S (S
Corporation)
Employment taxes, same as sole proprietor
Excise taxes
S Corporation Shareholder
Income tax, 1040 and Schedule E
Estimated tax, 1040-ES
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