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Step One: Determine your entity type, the tax form your business needs to file, and the filing deadline
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Sole Proprietors file form Schedule C. Form Schedule C is filed with your personal tax return, and the deadline is 4/15
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Single Member LLCs file form Schedule C by default. Form Schedule C is filed with your personal tax return, and the deadline is 4/15
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Single Member LLCs can make a timely election to file taxes as an S Corporation or C Corporation. Please see below.
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Multi-Member LLCs are treated as a partnership by default and file form 1065. The 1065 is a separate filing from your personal return and must be filed before any member can file their personal returns. The deadline is 3/15
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Partnerships with two or more partners file form 1065. Form 1065 is a separate filing from your personal return and must be filed before any of the partners can file their personal returns. The deadline is 3/15
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S Corporations file form 1120S. Form 1120S is a separate filing from your personal return and must be filed before any of the shareholders can file their personal returns. The deadline is 3/15
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C Corporations file form 1120. Form 1120 is a separate filing from your personal return. The deadline is 4/15
Step Two: Conduct final review books and records for the year, and produce year-end reports
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All business entities must produce a Profit & Loss report (aka Income & Expense report) for their tax filing.
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All businesses claiming automobile expenses using the standard mileage deduction must keep a written or digital log of the miles driven.
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Partnerships, Multi-Member LLCs, S Corporations, and C Corporations must produce an accurate balance sheet for their tax filing.
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Partnerships, Multi-Member LLCs, S Corporations, and C Corporations must produce an accurate report of distributions, dividends, and guaranteed payments paid to members, partners and/or shareholders.
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All business entities must produce an accurate report of estimated tax payments made for the tax year.
Step Three: Review your business tax return for accuracy, sign your return, and pay any balances due
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Payments can be made electronically or by sending a check or money order to the appropriate taxing agency.
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Penalties and interest will be applied to all taxes not paid on time.
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If you cannot pay your balance in full, an installment plan is a good way to stay compliant and pay over time.
Step Four: Distrubute forms K-1, 1099-DIV, and other forms to the members, partners, and/or shareholders
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Partnerships and S Corporations are flow through entities. All profits flow through to their members, partners and shareholders, and are reported on form K-1.
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C Corporations pay out dividends to it's shareholders, and they are reported on form 1099-DIV.
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Individuals should not file their personal returns until all forms K-1 and 1099-DIV have been distributed.
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