[ad_1]
As of December twenty seventh, 2020 the Paycheck Safety Program is again, and Biz2Credit can get your business started with a straightforward course of that can assist you get funded shortly.
Final yr, throughout the onset of the COVID-19 pandemic, the US authorities made numerous modifications to how people and companies might file tax returns and pay earnings taxes, most notably delaying the due date for tax funds, introducing beneficiant tax credit, and making electronic tax filing (or e-filing) and on-line companies extra accessible and straightforward to make use of. The identical sorts of reforms are occurring for the 2020-2021 tax yr. Small enterprise house owners must study these modifications in an effort to accurately cope with tax preparation and pay their enterprise taxes.
On this article, we’ll deal with the implications of the COVID-19 pandemic with respect to small enterprise taxes and the way small enterprise house owners can navigate paying their 2021 enterprise taxes on-line.
How Has the Coronavirus Modified How Companies Are Dealing with Their Taxes?
The COVID-19 pandemic induced a number of modifications and interventions by the federal authorities to offer reduction choices surrounding the taxes due by small companies. Whereas this isn’t an exhaustive record, we needed to spotlight some examples of how COVID-19 has affected your tax invoice.
Particular person Taxpayer Deadline Prolonged to Could 17, 2021
For small companies which can be operated by a single particular person, the filing deadline was prolonged to Could 17. This consists of single-member LLCs and sole proprietorships. This, importantly, does NOT embrace companies like S firms, partnerships, and firms.
Severely Impacted Companies Could Qualify for Pandemic-related Tax Credit
For example, the Employee Retention Tax Credit, handed within the Taxpayer Certainty and Catastrophe Tax Aid Act of 2020, expanded related tax credit initially handed with the CARES Act. The Families First Coronavirus Response Act (FFCRA) permits companies to get tax credit for 100% of sick-leave pay, family-leave pay, certified healthcare plan bills, and the employer share of FICA taxes for sick-leave prices.
Speaking with a licensed tax skilled might assist you discover different tax credit that would provide you with some tax reduction. That is very true for any coverage modifications made to your native taxes by your native authorities or your state’s Division of Income. You’ll want to be sure you don’t miss out on any potential financial savings that would assist your corporation financially.
Some Tax Aid Must be Paid Again
Whereas some tax reduction packages produced everlasting reductions to 2020 tax payments, others simply delayed sure funds. Employers who elected to defer payroll taxes between March 27th, 2020 and December 31st, 2020 should pay half of the deferred quantity by the tip of 2021 and the opposite half by the tip of 2022. When you have been somebody who elected to reap the benefits of one in all these choices, try to be getting ready to satisfy the ensuing monetary obligations. You undoubtedly don’t wish to let this excellent tax legal responsibility catch you off guard. Talking with a licensed public accountant (CPA) may also help you make sense of what you owe and the way this deferral could impression your tax liabilities.
What Are My On-line Tax Fee Choices as a Small Enterprise Proprietor?
Small enterprise house owners have loads of choices out there to them to make all the required funds for any taxes they could encounter.
Utilizing IRS Direct Pay
The IRS permits enterprise house owners paying enterprise taxes by way of their private taxes to pay taxes for the Form 1040 collection, estimated taxes, and different related kinds like installment funds or extensions straight from a checking account, whether or not that be a checking or financial savings account. This on-line service is totally free, too!
The Direct Pay web site from the IRS permits funds to be made on any weekday from 12am to 11:45pm ET, and on Sundays from 7am to 11:45pm ET. The instrument additionally permits you to search for any previous tax funds you’ve made so you possibly can replace your information or reply to requests for audits.
Solely two funds may be made inside a 24-hour interval and are restricted to not more than $10 million. Bigger digital funds ought to be made by way of the Electronic Federal Tax Payment System (EFTPS) or same-day wire transfers.
Paying with a Debit/Credit score Card
You can even make your corporation tax funds through the use of a enterprise debit or bank card. Typically small enterprise house owners do that to maximize their cash back/travel rewards related to their bank cards. However bear in mind to be cautious of the charges surrounding this. The charges charged when paying your taxes with a credit score or debit card can wipe out the profit from elevated rewards.
- Professional Tip: The charges nearly all the time cancel out any typical rewards earned by making a big tax cost however may be price it in case you are attempting to clear a big sign-on bonus threshold.
The IRS lists plenty of approved payment processors by way of which you may make these transactions with clear and clear charges and comparability tables.
Paying By the EFTPS Device
Giant firms and small companies that elect to pay their taxes as a company, like those that are fashioned as an LLC or S corporation, could make their funds by way of the Electronic Federal Tax Payment System (EFTPS). You possibly can even use the EFTPS to make employment tax funds or estimated tax funds.
You’ll need to arrange an account utilizing your employer identification quantity (EIN) or social safety quantity (SSN), a pin variety of your selecting, and a (hopefully very sturdy) password. Funds may be scheduled upfront and the instrument makes it simple to trace and archive previous funds.
Importantly, if your corporation has workers, you’ll want to make use of the EFTPS system to pay payroll taxes, make federal earnings tax withholdings, cope with FICA (Social Safety and Medicare taxes) and federal unemployment taxes.
Paying By a Tax Preparer Software program or Service Supplier
If you e-file by way of a tax prep software program like TurboTax or a service supplier like H&R Block, they’ll typically will let you pay by way of their platform. Such a service can have its personal types of processing prices and costs that are often included within the value of the general service.
One of the best ways to study these choices is to talk to representatives on the establishment you might be planning to make use of on your tax preparation. They’ll be capable to present you info related to your corporation and provide you with an in depth clarification of the totally different charges and prices related to their on-line tax preparation software program plans and packages.
Conclusion
Taxes are sometimes one of the crucial troublesome elements of working a enterprise for small enterprise house owners, and with the latest modifications and reduction packages which were handed within the wake of the COVID-19 pandemic, issues have solely gotten extra sophisticated. As such, when you’ve got elected to take any of the choices for reduction that both the federal authorities or your state or native governments have supplied, you’ll want to search skilled assist from a CPA in coping with your taxes. You’ll want to just be sure you are getting the entire financial savings as a result of your corporation whereas on the similar time avoiding any errors that would find yourself being expensive someday down the street.
As all the time, at Biz2Credit we’re devoted to serving to small companies, particularly throughout this attempting time. For extra essential info surrounding the pandemic and different small enterprise packages, ensure examine again right here at our Biz2Credit Weblog!
[ad_2]
Source link