Does Your Small Business Owe Estimated Tax?

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Ro Williams simplifies estimated tax and whether or not your business needs to pay them. Have a question? Ask when you register & we'll try to answer it during the webinar!

Ro is a part of the tax research team at ComplYant. She is an experienced professional in the tax industry and has previously held positions at an International Law firm and Public Accounting firms.

Note: This topic covers U.S. business taxes only.

Recording Highlights

  • 2:20 - What are estimated taxes?
  • 3:18 - What are estimated tax payments?
  • 5:20 - Who’s responsible for estimated tax payments?
  • 5:50 - How often are estimated tax payments made?
  • 7:46 - Where to pay estimated tax payments?
  • 8:18 - Where to pay estimated tax payments?
  • 8:36 - What happens if estimated tax payments are not made?
  • 9:38 - Wrap-up
  • 10:10 - Q&A

Q&A

How do the payment amounts get estimated? Is there an IRS calculator or something?

There are a couple of ways to estimate the payment. You can go to the 1040 worksheet, depending on if you're a business owner, if you are an LLC, it depends on what you are. So you can go to the 10 40 ES worksheet. And that worksheet is congruent with worksheets 2-1, or you can go to the 1120 W worksheet. And that also is congruent to 2-1. You use those worksheets together and you come up with the amount, the worksheet walks you through each line item of what you should put and where you should put it.

If you prefer, you can use an estimated tax calculator. And the IRS has one and also Complyant has one. And the estimated tax calculator again is just an estimation, but it's just a quicker way to get to the number of what you owe for those time periods.

What are the different kinds of corporate taxes in the US?

In the US, we have something like a two-tier system, depending on where you live. So if you just have a regular business, just a regular everyday business, then you're gonna pay your federal tax, you're going to pay your state tax. Then you may have to pay your city tax or your county tax. And then you may have to also pay a local tax, which is distributed between the municipals of the city you are in.

Would you recommend a new small business owner pay for an accountant?

Just make sure that what you are doing is accurate. You can buy all the software in the world, but that software doesn't necessarily talk to you about your specific tax needs. I think that's the biggest issue with some people. Another thing about having a company is you try to make the best decision for your company.

It's always good to consult a professional, even if you consult them on a one-time thing, and make sure you have the best software to guide you through that. ComplYant has a calendar to keep track of those dates that you need to make payments. But yes, always consult a professional, especially if it's an area that seems easy, but you don't know the ins and outs of it.