Taxes
the big picture
Everyone wants a piece of the pie. Federal, state, and local governments will take more money from you throughout your lifetime than any other source. While not an exhaustive list, below will give you a basic understanding of your tax responsibilities.
Our firm’s first step is to file accurately and on time to avoid penalties and interest charges. Our second step is to seek insights into your business and life to understand how you can find more deductions, credits, and otherwise save money through tax planning.
Business Taxes
State & Local Excise
- There are different versions of this tax. Depending on where you live, you may need to get a state and/or local business license and file regularly. This tax is normally calculated off your business’ gross revenue, payroll, or some combination.
Federal & State Payroll
- If you have employees, you’ll need to pay withholding from their paychecks to the IRS and state agencies.
- Worker’s compensation is required in many states.
- Unemployment insurance is also required in some jurisdictions.
- New and creative taxes, such as Washington’s Paid Family and Medical Leave will likely continue to crop up in the future.
Income
- It is important to understand that ONLY C-corporations pay an income tax. If you operate as any other legal entity, you will only pay individual taxes.
Individual Taxes
Federal & State Income
- You pay based on the graduated tax brackets that the IRS updates each year.
Self-Employment
- You pay 15.3% for Social Security (12.4%) and Medicare (2.9%), with some limitations and thresholds. Normally, employer pays half and employee pays half. As a self-employed individual, you get to pay both.