Author: Dona Basu

What is A Tax Resale Certificate?

As a savvy small business retailer, it is important that you are aware of how to utilize tax resale certificates to your best advantage. In short, a tax retail certificate allows you not to pay sales tax on items that you plan to resell. This can also apply to supplies that are going to be used in products that you will resell, such as wood for a cabinet.

It is critical that you understand that tax resale certificates can also be used on items that will be resold. Office supplies, such as new computers for your employees, would not fall under the category of retail.  It would be considered fraud not to pay sales tax on these items.

If this is confusing for you, just think of tax resale certificates as state tax exemption certificates.  Some states actually call them exemption certificates or reseller’s permits.

Do All States Charge Sales tax?

There are also states that do not charge sales tax. Alaska, Delaware, Montana, New Hampshire, and Oregon do not charge sales tax on a state level. Alaska and Montana do allow municipalities to charge sales tax on retail goods at a local level. A tax retail certificate is not needed in these places with regard to a state sales tax.

What Do I Do if I Purchase Goods In Multiple States?

The tax resale certificate can be challenging if you purchase and sell goods in multiple states. It can mean keeping track of many types of certificates for different vendors. The multijurisdiction resale certificate, which is also known as a blanket retail certificate or a uniform sales tax certificate, can help ease this burden.  As its name suggests this document can be used over multiple states. However, the document itself can be confusing and it is not accepted the same way in every state. It is important that the document is filled out correctly, and the retailer is aware of the different issues that can arise if it is misused.   

What Information Do I Need For The Tax Certificate Registration Form?

You must provide the following information:

• The name and address of the purchaser
• The name and address of the seller
• The registration number of the purchaser
• An accurate description of property purchased for resale
• The reason for the exemption
• A statement that if the property is put to use in a taxable manner that the purchaser will remit the consumer use tax
• Date and Signature and Title of the authorized individual at the purchaser

How Do I Know If I Need To Pay Sales Tax In A Given State?

In order to establish whether or not a state can impose a sales tax upon your business there first needs to be nexus. Nexus relating to state sales tax is established by a connection between the state and your business. How this connection is defined has been subject to fairly recent changes that reflect changes in the way business is conducted in modern times.

Traditionally, the nexus has been established by the business actually having a physical presence in the state. However, due to the explosion of e-commerce, physical presence within a state is no longer a requirement for sales tax nexus. In the case of South Dakota v. Wayfair, the courts actually eliminated physical presence as the major requirement for creating nexus. It still should be noted that physical presence is considered an important requirement to allow a state to collect sales tax and is still one of the first considerations for sales tax.

What Happens If I Do Most Of My Business In A State That I Am Not Incorporated?

If you primarily do business in a state that you are not incorporated in, make sure you apply for a Foreign Qualification (also known in some states as a Certificate of Registration or Certificate of Authority). This is the process of registering your company, which is considered domestic to the state in which it was originally formed and foreign to all other states, as a foreign entity in the states in which it operates. The retailer is then able to legally conduct business outside the state in which the company was originally formed and therefore should be able to apply for a tax resale certificate. 

Remember To Verify Any Tax Resale Certificate Presented To You

In the first part of our series, we mentioned that a vendor can refuse a tax resale certificate. This is because the vendor will be the one liable to the state government should anything be remiss. That is why you should always take the following steps to assure that anything presented to you is valid.

• Make certain that the certificate is properly filled out and signed by the business owner
• You should be able to verify the certificate online by using the certificate
• You should also be able to verify online if the certificate has expired
• Be award of purchase that seem suspicious and do not relate to the customer’s business in a logical manner
• It is important that you keep the certificate on file for at least 5 years in case of a tax audit.

That Is Why We Are Here To Help

It is understandable that all this information can be very daunting. Not correctly understanding sales tax and the benefits of a tax resale certificate can lead to a great deal of trouble. A retailer could lose out on extremely beneficial sales tax exemption status. A savvy business owner will understand that having a tax resale certificate will save them a good deal of money but leave the actual headache of registration to someone else.

On the other hand, misunderstanding and not paying the correct sales tax to a state government could very much hurt a business’s standing and reputation. At Tax Resale Certificate,  we make the process as easy as possible. Just take advantage of our user-friendly interface to help take the headache of applying for a tax resale certificate off your plate. 

It Can Be Confusing

Sales Tax regulations can be a source of great confusion for small businesses. The rules seem to be continuously changing and it can be very difficult to keep up.

However, remembering some relatively simple concepts will go a long way toward easing the stress associated with sales tax issues.

How Do I Know If My Business Needs To Collect Sales Tax?

Forty-five out of the fifty states require businesses to collect sales tax. This does not even include that many cities and localities that also have sales tax regulations. You must understand the rules of the places that you do business. Does your state or local area require some sort of license or sales permit? Be sure that you are charging the correct rate for both the point of sale and the types of products your business sells.

How Do I Know If I Need To Pay Sales Tax In A Given State?

To establish whether or not a state can impose a sales tax upon your business there first needs to be nexus. Nexus relating to state sales tax is established by a connection between the state and your business. How this connection is defined has been subject to fairly recent changes that reflect changes in the way business is conducted in modern times.

Traditionally, the nexus has been established by the business having a physical presence in the state. However, due to the explosion of e-commerce, physical presence within a state is no longer a requirement for sales tax nexus. In the case of South Dakota v. Wayfair, the courts eliminated physical presence as the major requirement for creating nexus. It still should be noted that physical presence is considered an important requirement to allow a state to collect sales tax and is still one of the first considerations for sales tax.

What Are The Different Methods In Which The States Establish Sales Tax Nexus?

The definition of sales nexus can vary greatly from state to state. Here is a list of the different ways in which states can determine sales tax nexus:

• Click-Through Nexus legislation
• Affiliate Nexus legislation
• Marketplace Nexus legislation
• Notice and Reporting Requirements
• Economic Nexus 

Click-Through Nexus legislation- This usually requires a remote seller to meet a minimum sales requirement in the state resulting from an in-state referral agent who is a resident of the state. The agent must be making commission payments to the referral agent for any sales that are the result of the click-through referrals from the agent’s website. 

Affiliate Nexus legislation– A remote retailer holds a substantial interest or is owned by a retailer that is located within the state and sells a similar type of product under a similar business name. Instate retailers can also be used to promote or market the product to in-state customers. Affiliate nexus does not require common ownership and may not include services such as sales and delivery.

Marketplace Nexus legislation– This definition applies to marketplace facilitators who operate a business in the state and provides e-commerce infrastructure, customer service, payment processing, and marketing services to individual sellers. The facilitator is the one that is required to register with the state and collect the sales tax rather than the individual sellers.

Notice and Reporting Requirements– This legislation requires that a retailer does not collect the state sales tax themselves but notify their buyers that they must report state use tax on all their purchases. The retailer might be required to send the purchaser a statement of all their purchases.

Economic Nexus– An out-of-state retailer generally is required to collect and remit sales tax once the retailer meets a set level of sales transactions or gross receipts activity (a threshold) within the state. No physical presence is required.

To find out more about state sales tax please visit the sales tax institute.

Are You Dealing With Taxable Products?

You need to make sure that the type of product your business is dealing in the jurisdiction that you are selling said product. You should make sure to ask the following questions:

• Does your state collect sales tax?
• Is the state sales tax based on the origin or destination?
• Are you selling a product or a service?
• Is your specific product or service taxed in the state or locality that you are selling?

What Happens To Goods That I Do Not Sell?

You might be wondering what becomes of goods you do not sell on which a sales tax has not been collected. These goods could be subject to a use tax. 

What Is The Use Tax?

Use tax applies to purchases made outside the taxing jurisdiction but used within the state. Use tax also applies to items purchased exempt from tax which is subsequently used in a taxable manner.

What is A Tax Resale Certificate?

You must understand that tax resale certificates can also be used on items that will be resold. Office supplies, such as new computers for your employees, would not fall under the category of retail.  It would be considered fraud not to pay sales tax on these items.

If this is confusing for you, just think of tax resale certificates as state tax exemption certificates.  Some states call them exemption certificates or reseller’s permits.

Tax Resale Certificate Is Here To Help

Not correctly understanding sales tax and the benefits of a tax resale certificate can lead to a great deal of trouble. A retailer could lose out on extremely beneficial sales tax exemption status. A savvy business owner will understand that having a tax resale certificate will save them a good deal of money but leave the actual headache of registration to someone else.

On the other hand, misunderstanding and not paying the correct sales tax to a state government could very much hurt a business’s standing and reputation. At Tax Resale Certificate,  we make the process as easy as possible. Just take advantage of our user-friendly interface to help take the headache of applying for a tax resale certificate off your plate. This way you can completely focus on the great opportunities presented by your Print on Demand business.

How Do I Know If I Need To Pay Sales Tax In A Given State?

To establish whether or not a state can impose a sales tax upon your business there first needs to be nexus. Nexus relating to state sales tax is established by a connection between the state and your business. How this connection is defined has been subject to fairly recent changes that reflect changes in the way business is conducted in modern times.

Traditionally, the nexus has been established by the business having a physical presence in the state. However, due to the explosion of e-commerce, physical presence within a state is no longer a requirement for sales tax nexus. In the case of South Dakota v. Wayfair, the courts eliminated physical presence as the major requirement for creating nexus. It still should be noted that physical presence is considered an important requirement to allow a state to collect sales tax and is still one of the first considerations for sales tax.

Do All States Charge Sales tax?

Some states do not charge sales tax. Alaska, Delaware, Montana, New Hampshire, and Oregon do not charge sales tax on a state level. Alaska and Montana do allow municipalities to charge sales tax on retail goods at a local level. A tax retail certificate is not needed in these places concerning a state sales tax.

What Happens If I Do Most Of My Business In A State That I Am Not Incorporated?

If you primarily do business in a state that you are not incorporated in, make sure you apply for a Foreign Qualification (also known in some states as a Certificate of Registration or Certificate of Authority). This is the process of registering your company, which is considered domestic to the state in which it was originally formed and foreign to all other states, as a foreign entity in the states in which it operates. The retailer is then able to legally conduct business outside the state in which the company was originally formed and therefore should be able to apply for a tax resale certificate. 

What Are The Different Methods In Which The States Establish Sales Tax Nexus?

The definition of sales nexus can vary greatly from state to state. Here is a list of the different ways in which states can determine sales tax nexus:

• Click-Through Nexus legislation
• Affiliate Nexus legislation
• Marketplace Nexus legislation
• Notice and Reporting Requirements
• Economic Nexus 

Click-Through Nexus legislation- This usually requires a remote seller to meet a minimum sales requirement in the state resulting from an in-state referral agent who is a resident of the state. The agent must be making commission payments to the referral agent for any sales that are the result of the click-through referrals from the agent’s website. 

Affiliate Nexus legislation– A remote retailer holds a substantial interest or is owned by a retailer that is located within the state and sells a similar type of product under a similar business name. Instate retailers can also be used to promote or market the product to in-state customers. Affiliate nexus does not require common ownership and may not include services such as sales and delivery.

Marketplace Nexus legislation– This definition applies to marketplace facilitators who operate a business in the state and provides e-commerce infrastructure, customer service, payment processing, and marketing services to individual sellers. The facilitator is the one that is required to register with the state and collect the sales tax rather than the individual sellers.

Notice and Reporting Requirements– This legislation requires that a retailer does not collect the state sales tax themselves but notify their buyers that they must report state use tax on all their purchases. The retailer might be required to send the purchaser a statement of all their purchases.

Economic Nexus– An out-of-state retailer generally is required to collect and remit sales tax once the retailer meets a set level of sales transactions or gross receipts activity (a threshold) within the state. No physical presence is required.

To find out more about state sales tax please visit the sales tax institute.

What Happens To Goods That I Do Not Sell?

You might be wondering what becomes of goods you do not sell on which a sales tax has not been collected. These goods could be subject to a use tax. 

What Is The Use Tax?

Use tax applies to purchases made outside the taxing jurisdiction but used within the state. Use tax also applies to items purchased exempt from tax which is subsequently used in a taxable manner.

Is The Tax Resale Certificate The Same As A Seller’s Permit?

Even though tax resale certificates are called reseller’s permits in some states, it is important not to confuse them with seller’s permits. A seller’s permit allows a retailer to charge tax on items that they are going to sell to a customer. A tax resale certificate allows you to buy items that are intended for resale without paying a sales tax on those items. 

Does A Vendor Have To Accept My Tax Resale Certificate?

It is extremely important to a retailer’s bottom line that they do not pay sales taxes on goods if there is a possibility that the tax can be exempted on a state level. However, it is also crucial to understand that a wholesaler is not required to accept your tax resale certificate in some states. 

That Is Why We Are Here To Help

Understandably, all this information can be very daunting. Not correctly understanding sales tax and the benefits of a tax resale certificate can lead to a great deal of trouble. A retailer could lose out on extremely beneficial sales tax exemption status. A savvy business owner will understand that having a tax resale certificate will save them a good deal of money but leave the actual headache of registration to someone else.

On the other hand, misunderstanding and not paying the correct sales tax to a state government could very much hurt a business’s standing and reputation. At Tax Resale Certificate,  we make the process as easy as possible. Just take advantage of our user-friendly interface to help take the headache of applying for a tax resale certificate off your plate. 

It Can Be Confusing

Sales Tax regulations can be a source of great confusion for small businesses. The rules seem to be continuously changing and it can be very difficult to keep up.

However, remembering some relatively simple concepts will go a long way toward easing the stress associated with sales tax issues.

How Do I Know If My Business Needs To Collect Sales Tax?

Forty-five out of the fifty states require businesses to collect sales tax. This does not even include that many cities and localities that also have sales tax regulations. You must understand the rules of the places that you do business. Does your state or local area require some sort of license or sales permit? Be sure that you are charging the correct rate for both the point of sale and the types of products your business sells.

How Do I Know If I Need To Pay Sales Tax In A Given State?

To establish whether or not a state can impose a sales tax upon your business there first needs to be nexus. Nexus relating to state sales tax is established by a connection between the state and your business. How this connection is defined has been subject to fairly recent changes that reflect changes in the way business is conducted in modern times.

Traditionally, the nexus has been established by the business having a physical presence in the state. However, due to the explosion of e-commerce, physical presence within a state is no longer a requirement for sales tax nexus. In the case of South Dakota v. Wayfair, the courts eliminated physical presence as the major requirement for creating nexus. It still should be noted that physical presence is considered an important requirement to allow a state to collect sales tax and is still one of the first considerations for sales tax.

What Are The Different Methods In Which The States Establish Sales Tax Nexus?

The definition of sales nexus can vary greatly from state to state. Here is a list of the different ways in which states can determine sales tax nexus:

• Click-Through Nexus legislation
• Affiliate Nexus legislation
• Marketplace Nexus legislation
• Notice and Reporting Requirements
• Economic Nexus 

Click-Through Nexus legislation- This usually requires a remote seller to meet a minimum sales requirement in the state resulting from an in-state referral agent who is a resident of the state. The agent must be making commission payments to the referral agent for any sales that are the result of the click-through referrals from the agent’s website. 

Affiliate Nexus legislation– A remote retailer holds a substantial interest or is owned by a retailer that is located within the state and sells a similar type of product under a similar business name. Instate retailers can also be used to promote or market the product to in-state customers. Affiliate nexus does not require common ownership and may not include services such as sales and delivery.

Marketplace Nexus legislation– This definition applies to marketplace facilitators who operate a business in the state and provides e-commerce infrastructure, customer service, payment processing, and marketing services to individual sellers. The facilitator is the one that is required to register with the state and collect the sales tax rather than the individual sellers.

Notice and Reporting Requirements– This legislation requires that a retailer does not collect the state sales tax themselves but notify their buyers that they must report state use tax on all their purchases. The retailer might be required to send the purchaser a statement of all their purchases.

Economic Nexus– An out-of-state retailer generally is required to collect and remit sales tax once the retailer meets a set level of sales transactions or gross receipts activity (a threshold) within the state. No physical presence is required.

To find out more about state sales tax please visit the sales tax institute.

Are You Dealing With Taxable Products?

You need to make sure that the type of product your business is dealing in the jurisdiction that you are selling said product. You should make sure to ask the following questions:

• Does your state collect sales tax?
• Is the state sales tax based on the origin or destination?
• Are you selling a product or a service?
• Is your specific product or service taxed in the state or locality that you are selling?

What Happens To Goods That I Do Not Sell?

You might be wondering what becomes of goods you do not sell on which a sales tax has not been collected. These goods could be subject to a use tax. 

What Is The Use Tax?

Use tax applies to purchases made outside the taxing jurisdiction but used within the state. Use tax also applies to items purchased exempt from tax which is subsequently used in a taxable manner.

What is A Tax Resale Certificate?

You must understand that tax resale certificates can also be used on items that will be resold. Office supplies, such as new computers for your employees, would not fall under the category of retail.  It would be considered fraud not to pay sales tax on these items.

If this is confusing for you, just think of tax resale certificates as state tax exemption certificates.  Some states call them exemption certificates or reseller’s permits.

Tax Resale Certificate Is Here To Help

Not correctly understanding sales tax and the benefits of a tax resale certificate can lead to a great deal of trouble. A retailer could lose out on extremely beneficial sales tax exemption status. A savvy business owner will understand that having a tax resale certificate will save them a good deal of money but leave the actual headache of registration to someone else.

On the other hand, misunderstanding and not paying the correct sales tax to a state government could very much hurt a business’s standing and reputation. At Tax Resale Certificate,  we make the process as easy as possible. Just take advantage of our user-friendly interface to help take the headache of applying for a tax resale certificate off your plate. This way you can completely focus on the great opportunities presented by your Print on Demand business.

There is no greater joy than owning and operating your own business. You look over your record-keeping and have a sense of well-deserved pride in your accomplishments of the past year. Then you remember tax season is looming over you like a dark shadow and a knot of worry forms in the pit of your stomach.

Small and Medium-sized are both the lifeblood of our economy and a crucial part of the American Dream. However, most of the industrious people who run these companies have neither the time nor proper understanding of the tax code to correctly prepare their business taxes even with the assistance of software.

It might be tempting to shelve tax-related issues until April, but this is highly unwise. It is smart to have the right tax professional by your side from the beginning to look out for all the unexpected issues that often plague small business accounting.

What Are Some Of The Tax Surprises That A Startup Might Stumble Upon?

Net Profit

Do you properly understand how to handle your cash flow? Are you going to pay taxes purely based on

What is available in your checking account? Many business owners do not realize that their available cash is not the same as the company’s net profit.

Business Organization

Are you sure that you have chosen the proper business organization? The type of organization has a strong bearing on your tax structure and you should make sure your organization utilizes the best tax structure for your business needs. Having a small business tax professional look over the Consumer Price Index is a good way to understand your business should be properly structured.

Independent Contractors

Are you confident that your independent contractors have not become employees during the tax year? Did you provide them with the right forms? Businesses need to understand how to properly document all those who have done work for them and the Internal Revenue Service or IRS regulations on such matters can be very perplexing.

Documenting Yourself

Have you, the owner, been taking money out of the business to pay personal or professional expenses?

Do you know what to call the money you have taken out? Are you drawing a salary?

Small business accounting can be quite complex and confusing. The wrong guess to any of these tough questions can land you into a lot of trouble with the IRS. This is why having the proper small business consultant is crucial to protecting your business from unnecessary taxes and fines.

What Are Some Things That A Startup Should Be Monitoring/Be On The Lookout For To Avoid Any Tax-Related Surprises?

Tax saving opportunities are available from January 1st to December 31st and are just not limited to the tax season. You must have someone who can advise you in real-time to make the proper decisions through each crucial step of building your business.

Someone who waits till tax season to seek advice will realize that most of the stronger options are no longer available to them. Every business transaction made by the business owner will have a powerful impact on their tax liability. A solid tax professional will help guide your business through every crucial moment, allowing for more financial security and stability. They will make sure that you are not sidelined with incorrect information that will lead to bad business tax decisions.

Why You Should Pay For Professional Advice

Many new business owners think they can do taxes on their own and end up owing back taxes. I remember the first time a client of mine went to a tax professional. The person was able to analyze the code and get my client a refund of well over $6,000. This was well worth the $800 that was spent going to the professional in the first place.

A Tax Professional Can Offer The Following Benefits To A Small Or Medium-Sized Business:

• A tax professional will study your business structure and explain to you what is the best structure for your particular businesses’ tax liability. They will help you alter the structure if this is the best course of action.
• Tax professionals will examine how your business is paying and reporting independent contractors and make sure that you are compliant in this area with all IRS regulations to avoid harsh penalties.
• They can look at past tax returns for deductions that have been missed or valuable credits that are available to the business.
• The tax professional can point out all manner of compliance issues that can be immediately corrected throughout the year so you have the strongest confidence going forward with all your regular business transactions.

Remember that every business is different and there is never going to be a one-size-fits-all solution to tax questions and problems. This is why it is vital to have a tax professional on your side all year round to guide you through an often confusing tax code.

The tax professional will protect your business from liability and make sure you comply with all major and minor regulations. They understand as a busy owner of a small to medium-sized business, you already have enough on your plate without also worrying about the mind-numbing minutiae of your business tax scheme. Let a business tax professional help you to greater business success and financial stability.

Tax Resale Certificate Is Here To Help

Not correctly understanding sales tax and the benefits of a tax resale certificate can lead to a great deal of trouble. A retailer could lose out on extremely beneficial sales tax exemption status. A savvy business owner will understand that having a tax resale certificate will save them a good deal of money but leave the actual headache of registration to someone else.

On the other hand, misunderstanding and not paying the correct sales tax to a state government could very much hurt a business’s standing and reputation. At Tax Resale Certificate,  we make the process as easy as possible. Just take advantage of our user-friendly interface to help take the headache of applying for a tax resale certificate off your plate. This way you can completely focus on the great opportunities presented by your Print on Demand business.

Make Sure You Have The Proper Forms

The first thing you should do is make sure you have the proper forms for your small business entity. 

What is a business entity?

A business entity is a corporation created by one or more natural persons to hold on to a trade or business.

The following are types of business entities:

• Sole proprietorship: Unincorporated business with one owner or jointly owned by a marriage

• General partnership: Unincorporated business with two or more owners

• Limited partnership: Registered business composed of active, general partners and passive, limited partners

• Limited liability company: Registered business with limited liability for all members

• Professional limited liability company: LLC structure for professionals, like doctors and accountants

• C-corporation: Incorporated business composed of shareholders, directors, and officers

• S-corporation: An Incorporated business that is taxed as a pass-through entity

• Professional corporation: Corporate structure for professionals, such as doctors and accountants

• B-corporation: For-profit corporation that is certified for meeting social and environmental standards

• Nonprofit: Corporations: Formed primarily to benefit the public interest rather than earn a profit.

You will use different types of forms but calculating the taxes itself will be similar.

Make Sure Your Documents Are In Order

Do an inventory of all your business records. It is key to have the right documents to accurately report your earnings and expenses. Computer software like Excel or Quicken greatly help in organizing your tax records. These programs can also save you time by importing information directly into your tax return.

Is Your Business a Pass-Through Entity?

A pass-through entity is when the tax liability of the business passes through to the owner.

Pass-through entities include:

• Sole Proprietorships
• Limited Liability Companies
• S Corporations

A business that has not filed any paperwork is automatically considered a sole proprietorship by the Internal Revenue Service.

If you are a pass-through entity then you could owe less in taxes. The Tax Cuts and Jobs Act allows a 20 percent tax deduction on qualified business income from pass-through businesses. Generally, the deduction is available to eligible taxpayers whose taxable income is below $315,000 for joint returns and $157,500 for individual filers, according to the IRS. Some types of pass-through businesses may not qualify for this deduction: The IRS regulations detail the limitations.

If your business is a pass-through entity, then the taxable business income must be reported with your tax return. This means the amount you owe will be determined by your tax bracket. For 2020, personal tax brackets range from 10 percent (for individuals earning up to $9,875 and joint filers earning up to $19,750) to 37 percent for individuals earning more than $518,400 and joint filers earning more than $622,050.

If Your Business Is A C-Corporation

A business that is not a pass-through entity is a C-corporation. These are usually larger companies that do not qualify as small businesses.  However, if your business is a c-corporations it will now be taxed at a flat rate of 21 percent. Remember that c-corporations are always taxed twice. That is because the c-corporation itself is looked upon as a separate entity. These entities are taxed at the business level and the shareholder level.

The Self Employment Tax

A self-employed person has to file additional taxes besides their income tax. This usually amounts to an extra 15.3% burden for small business owners. This is because employers and employees each pay 7.65% for both Social Security and Medicare taxes, so a self-employed individual will have to pay the full amount.

Remember The Quarterlies

Since self-employed owners do not get taxes withheld from their paycheck, it is a good idea to withhold the correct amount and send the Internal Revenue Service quarterly payments. This is particularly important if your tax liability is over $1.000. Ignoring quarterly payments could result in costly interest payments or penalties.

Become Proactive

Business taxes are determined by net income. This is when you subtract business expenses from gross revenues. Having an online accounting system automatically keeps track of your figures. If you use an online accounting system and you’ve entered all income and expenses, the system will automatically provide you with a gross profit figure.  Those that use spreadsheets, please take the time to add up the numbers so you can forecast what you will need to owe in taxes for the following year.

What Are Some Things That A Business Should Be Monitoring/Be On The Lookout For To Avoid Any Tax-Related Surprises?

Tax saving opportunities are available from January 1^st to December 31^st and are just not limited to the tax season. You must have someone who can advise you in real-time to make the proper decisions through each crucial step of building your business.

Someone who waits till tax season to seek advice will realize that most of the stronger options are no longer available to them. Every business transaction made by the business owner will have a powerful impact on their tax liability. A solid tax professional will help guide your business through every crucial moment, allowing for more financial security and stability. They will make sure that you are not sidelined with incorrect information that will lead to bad business tax decisions.

Getting A Tax Resale Certification Is One Of The Best Things You Can Do As An Entrepreneur

If you decide to start a business, a tax resale certificate can save you money on taxes.

In short, a tax retail certificate allows you not to pay sales tax on items that you plan to resell. This can also apply to supplies that are going to be used in products that you will resell, such as wood for a cabinet.

However, the process can be difficult and the rules are different for each state. That is why TaxResaleCertificate should do all the hard work for you. We can make sure that you get all the advantages of a tax resale certificate without having to deal with the hassle of government red tape. Let us handle the hard stuff so you can proceed to run your business with confidence. Make sure you check out our second blog in this series so you can learn even more valuable information about tax resale certificates.

Increase In Interest Deductions For Small Businesses

The CARES Act allows you to increase the amount of interest expense that you are allowed to deduct from 30 percent to 50 percent. This applies to tax returns filed in both 2019 and the ones filed in 2020.

Writing Off Facility Improvements

The CARES Act allows businesses to start writing off the cost that comes with improvements to interiors of nonresidential buildings. This will expand the tax deduction to 100 percent of the cost and the deductions can be applied immediately. This is effective from 2018 to the present, so businesses can amend older tax returns to recover costs from improvements made in 2018 and 2019.

Family And Sick Leave

Employers will be 100 percent reimbursed for providing sick and paid family leave to employees for reasons related to the Coronavirus, by a tax credit. This will be paid every quarter. Employers will also be able to hold on to their portion of payroll taxes to be deposited and use this money to pay for sick and family leave. There will be no penalty for businesses that do not deposit payroll taxes because they were anticipating a tax credit.

Advertising

Self-Employed people should keep in mind that all advertising costs are fully tax-deductible.

This can include the following

• The cost of printing business cards, flyers, and mailers
• Social media advertising like Facebook ads
• Promotions at conventions and trade shows
• The cost of advertising agencies
• Television and radio advertising
• Employing freelancers

You can also deduct all commissions paid to non-employees for sales and marketing purposes. This can include payments to individual sales reps, or marketing channels, and a platform like Amazon.

Is Your Business a Pass-Through Entity?

A pass-through entity is when the tax liability of the business passes through to the owner.

Pass-through entities include:

• Sole Proprietorships
• Limited Liability Companies
• S Corporations

A business that has not filed any paperwork is automatically considered a sole proprietorship by the Internal Revenue Service.

If you are a pass-through entity then you could owe less in taxes. The Tax Cuts and Jobs Act allows a 20 percent tax deduction on qualified business income from pass-through businesses. Generally, the deduction is available to eligible taxpayers whose taxable income is below $315,000 for joint returns and $157,500 for individual filers, according to the IRS. Some types of pass-through businesses may not qualify for this deduction: The IRS regulations detail the limitations.

If your business is a pass-through entity, then the taxable business income must be reported with your tax return. This means the amount you owe will be determined by your tax bracket. For 2020, personal tax brackets range from 10 percent (for individuals earning up to $9,875 and joint filers earning up to $19,750) to 37 percent for individuals earning more than $518,400 and joint filers earning more than $622,050.

Remember The Deductions

Read our helpful article on deductions that your small business can not afford to miss.  It includes the following:

• Travel by airplane, train, bus, or car between your home and your business destination. (If you’re provided with a ticket or you’re riding free as a result of a frequent traveler or similar program, your cost is zero.)
• Fares for taxis or other types of transportation between the airport or train station and your hotel, the hotel, and the work location, and from one customer to another, or from one place of business to another.
• Shipping of baggage, and sample or display material between your regular and temporary work locations.
• Using your car while at your business destination. You can deduct actual expenses or the standard mileage rate, as well as business-related tolls and parking fees. If you rent a car, you can deduct only the business-use portion for the expenses.
• Meals and lodging.
• Dry cleaning and laundry.
• Business calls while on your business trip. (This includes business communications by fax machine or other communication devices.)
• Tips you pay for services related to any of these expenses.
• Other similar ordinary and necessary expenses related to your business travel. (These expenses might include transportation to and from a business meal, public stenographer’s fees, computer rental fees, and operating and maintaining a house trailer.)
• Many apps have come on the market that makes it exceptionally easy to scan and track receipts for travel-related expenses. Some of these apps also automatically categorize expenses which is very nice for accurate bookkeeping.

Become Proactive

Business taxes are determined by net income. This is when you subtract business expenses from gross revenues. Having an online accounting system automatically keeps track of your figures. If you use an online accounting system and you’ve entered all income and expenses, the system will automatically provide you with a gross profit figure.  Those that use spreadsheets, please take the time to add up the numbers so you can forecast what you will need to owe in taxes for the following year.

Let Us Handle The Hassle Of A Tax Resale Certificate

During these tough times, it is nice if someone takes a frustrating but beneficial task off your plate. That is why, here at Tax Resale Certificate, we handle all the headaches of registering for a tax resale certificate for you.

At Tax Resale Certificate,  we make the process as easy as possible. Just take advantage of our user-friendly interface to help take the headache of applying for a tax resale certificate off your plate. 

We provide a tax resale certificate for the top states that include:

• California
• Texas
• Massachusetts
• New York
• New Jersey
• Illinois
• Florida

We know that there is a lot of confusion in the world right now. Luckily, these tax credits will help ease some of the burdens. A tax resale certificate is a fantastic way to make sure your business is in great shape to take advantage of consumer demand once the dust settles. We can make sure that you get all the advantages of a tax resale certificate without having to deal with the hassle of government red tape. Let us handle the hard stuff so you can proceed to run your business with confidence. 

There is no greater joy than owning and operating your own business. You look over your record-keeping and have a sense of well-deserved pride in your accomplishments of the past year. Then you remember tax season is looming over you like a dark shadow and a knot of worry forms in the pit of your stomach.

Small and Medium-sized are both the lifeblood of our economy and a crucial part of the American Dream. However, most of the industrious people who run these companies have neither the time nor proper understanding of the tax code to correctly prepare their business taxes even with the assistance of software.

It might be tempting to shelve tax-related issues until April, but this is highly unwise. It is smart to have the right tax professional by your side from the beginning to look out for all the unexpected issues that often plague small business accounting.

What Are Some Of The Tax Surprises That A Business Might Stumble Upon?

Net Profit

Do you properly understand how to handle your cash flow? Are you going to pay taxes purely based on

What is available in your checking account? Many business owners do not realize that their available cash is not the same as the company’s net profit.

Business Organization

Are you sure that you have chosen the proper business organization? The type of organization has a strong bearing on your tax structure and you should make sure your organization utilizes the best tax structure for your business needs. Having a small business tax professional look over the Consumer Price Index is a good way to understand your business should be properly structured.

Independent Contractors

Are you confident that your independent contractors have not become employees during the tax year? Did you provide them with the right forms? Businesses need to understand how to properly document all those who have done work for them and the Internal Revenue Service or IRS regulations on such matters can be very perplexing.

Documenting Yourself

Have you, the owner, been taking money out of the business to pay personal or professional expenses?

Do you know what to call the money you have taken out? Are you drawing a salary?

Small business accounting can be quite complex and confusing. The wrong guess to any of these tough questions can land you into a lot of trouble with the IRS. This is why having the proper small business consultant is crucial to protecting your business from unnecessary taxes and fines.

What Are Some Things That A Business Should Be Monitoring/Be On The Lookout For To Avoid Any Tax-Related Surprises?

Tax saving opportunities are available from January 1^st to December 31^st and are just not limited to the tax season. You must have someone that can advise you in real-time so you make the proper decisions through each crucial step of building your business.

Someone who waits till tax season to seek advice will realize that most of the stronger options are no longer available to them. Every business transaction made by the business owner will have a powerful impact on their tax liability. A solid tax professional will help guide your business through every crucial moment which allows for more financial security and stability. They will make sure that you are not sidelined with incorrect information that will lead to bad business tax decisions.

A Tax Professional Can Offer The Following Benefits To A Small Or Medium-Sized Business:

•  A tax professional will study your business structure and explain to you what is the best structure for your particular businesses’ tax liability. They will help you alter the structure if this is the best course of action.

• Tax professionals will examine how your business is paying and reporting independent contractors and make sure that you are compliant in this area with all IRS regulations to avoid harsh penalties.

• They can look at past tax returns for deductions that have been missed or valuable credits that are available to the business.

• The tax professional can point out all manner of compliance issues that can be immediately corrected throughout the year so you have the strongest confidence going forward with all your regular business transactions.

Remember that every business is different and there is never going to a one-size-fits-all solution to tax questions and problems. This is why it is vital to have a tax professional on your side all year round to guide you through an often confusing tax code.

The tax professional will protect your business from liability and make sure you are in compliance with all major and minor regulations. They understand as a busy owner of a small to medium-sized business, you already have enough on your plate without also worrying about the mind-numbing minutiae of your business tax scheme. Let a business tax professional help you to greater business success and financial stability.

Getting A Tax Resale Certification Is One Of The Best Things You Can Do As An Entrepreneur

If you decide to start a business, a tax resale certificate can save you money on taxes.

In short, a tax retail certificate allows you not to pay sales tax on items that you plan to resell. This can also apply to supplies that are going to be used in products that you will resell, such as wood for a cabinet.

However, the process can be difficult and the rules are different for each state. That is why TaxResaleCertificate should do all the hard work for you. We can make sure that you get all the advantages of a tax resale certificate without having to deal with the hassle of government red tape. Let us handle the hard stuff so you can proceed to run your business with confidence. Make sure you check out our second blog in this series so you can learn even more valuable information about tax resale certificates.

There is something so energizing about the word start-up that it makes you want to jump out of your seat and start running around. Start-ups have this reputation of being a carpe diem/seize the day exercises in spontaneity.

We all fantasize about quitting our daily grind and just passionately steamrolling ourselves into a successful enterprise.

Separating Romance From Reality

The truth of the matter is that a Start-up means just the beginning. Either it will morph into a sustainable long-term business, that you will run or sell to someone else, or perhaps fizzle into a giant ball of nothing.

Longevity Should Not Be Taken For Granted

So many startups are just trying to make it to the next day that they can not even start to think about 50 years into the future. However, no one invests their time and energy into a start-up without at least the hope that there is no expiration date to their dream.

So what is the secret to making sure that your start-up is not a fly-by-night operation?

Believe It Or Not…The Profit Margin Is Not The Bottom Line

We all know that profitability is needed to sustain a business. However, it is just as important is to define the values that make up the core of your company and what your company is meant to contribute to society.

You must define the value that you create with your product or service. This is key to having a deep understanding of what is going to be your long-term goals. This will also help guide you to figure out what means the business will be pursued to achieve these goals.

These types of core values are the rudder for your start-up boat. Think of it like a conscience that keeps the boat on course instead of allowing the start-up to drift aimlessly into oblivion.

This type of attitude automatically allows you to create a contract with your community which is always a sign of mutual respect which can also go a long way to securing customer loyalty.

Your Company Has To Be Flexible And Open to Change

Many people think of the start-up as a hypothetical child. They want to nurture it to become the best that it can be. However, they should also acknowledge that a child has many stages of life. The needs of a toddler are very different from the needs of a teenager.

Your company will experience many periods of growth and change. Markets can be very volatile and what is novel today can easily turn into old news tomorrow. Remember that building a successful company is a long marathon, not a sprint. You have to be open to redefining your position not once, but several times in a company’s lifetime. The business must be malleable enough to withstand the challenges brought about by new technology, changes in regulations, and societal shifts.

Leadership Will Eventually Have To Be Scalable

A typical start-up is often the vision of a very small group of people. These individuals often will control every aspect of the early stages of a new company. However, there will come a time when the company will have to expand the framework of leadership. This type of delegation often comes much sooner than most start-ups realize and often catches the original small leadership team by surprise.

The decision-making demands of the business must be distributed evenly as the company experiences growth. A small group can only logistically do so much. A start-up that refuses to scale its leadership will be in danger of becoming obsolete.

One of your main goals as a start-up to eventually build a strong team that has many tiers of leadership. This will empower the company and create an atmosphere of confidence. A business with this type of attitude usually has no difficulty in recruiting high levels of talent. People want to be part of a company that is not stifled by outdated founder principles.

All Of These Principles Combine To Create Endurance

So in conclusion, defining your start-up’s core values, being open to changes brought by growth, and having scalable leadership will help ensure that your business endures for the long term. You are creating a strong DNA model that will help you run the long marathon from start-up to an established successful company that will be around for a long time.

Launching and Marketing

Once you have worked out all the operational and technical bugs it is time to launch your new online retail business. Make sure that you market to your customers on multi-levels including taking advantage of many types of social media. You should also be aware of search engine optimization to make sure that your customers can find you easily. It is a good idea to maintain an ongoing flow of content on the site to both attract and engage your core market.

Make Sure You Understand The Specific Guidelines Of Your State

A tax resale certificate is a wonderful way a business can avoid unnecessary taxes. However, we understand that there are a lot of rules and regulations, which can be very confusing to any business owner.

Tax Resale Certificate Is Here To Help

Not correctly understanding sales tax and the benefits of a tax resale certificate can lead to a great deal of trouble. A retailer could lose out on extremely beneficial sales tax exemption status. A savvy business owner will understand that having a tax resale certificate will save them a good deal of money but leave the actual headache of registration to someone else.

On the other hand, misunderstanding and not paying the correct sales tax to a state government could very much hurt a business’s standing and reputation. At Tax Resale Certificate,  we make the process as easy as possible. Just take advantage of our user-friendly interface to help take the headache of applying for a tax resale certificate off your plate. This way you can completely focus on the great opportunities presented by your Print on Demand business

There is no greater joy than owning and operating your own business. You look over your record-keeping and have a sense of well-deserved pride in your accomplishments of the past year. Then you remember tax season is looming over you like a dark shadow and a knot of worry forms in the pit of your stomach.

Small and Medium-sized are both the lifeblood of our economy and a crucial part of the American Dream. However, most of the industrious people who run these companies have neither the time nor proper understanding of the tax code to correctly prepare their business taxes even with the assistance of software.

It might be tempting to shelve tax-related issues until April, but this is highly unwise. It is smart to have the right tax professional by your side from the beginning to look out for all the unexpected issues that often plague small business accounting.

What Are Some Of The Tax Surprises That A Business Might Stumble Upon?

Net Profit

Do you properly understand how to handle your cash flow? Are you going to pay taxes purely based on

What is available in your checking account? Many business owners do not realize that their available cash is not the same as the company’s net profit.

Business Organization

Are you sure that you have chosen the proper business organization? The type of organization has a strong bearing on your tax structure and you should make sure your organization utilizes the best tax structure for your business needs. Having a small business tax professional look over the Consumer Price Index is a good way to understand your business should be properly structured.

Independent Contractors

Are you confident that your independent contractors have not become employees during the tax year? Did you provide them with the right forms? Businesses need to understand how to properly document all those who have done work for them and the Internal Revenue Service or IRS regulations on such matters can be very perplexing.

Documenting Yourself

Have you, the owner, been taking money out of the business to pay personal or professional expenses?

Do you know what to call the money you have taken out? Are you drawing a salary?

Small business accounting can be quite complex and confusing. The wrong guess to any of these tough questions can land you into a lot of trouble with the IRS. This is why having the proper small business consultant is crucial to protecting your business from unnecessary taxes and fines.

What Are Some Things That A Business Should Be Monitoring/Be On The Lookout For To Avoid Any Tax-Related Surprises?

Tax saving opportunities are available from January 1^st to December 31^st and are just not limited to the tax season. You must have someone that can advise you in real-time so you make the proper decisions through each crucial step of building your business.

Someone who waits till tax season to seek advice will realize that most of the stronger options are no longer available to them. Every business transaction made by the business owner will have a powerful impact on their tax liability. A solid tax professional will help guide your business through every crucial moment which allows for more financial security and stability. They will make sure that you are not sidelined with incorrect information that will lead to bad business tax decisions.

A Tax Professional Can Offer The Following Benefits To A Small Or Medium-Sized Business:

•  A tax professional will study your business structure and explain to you what is the best structure for your particular businesses’ tax liability. They will help you alter the structure if this is the best course of action.

• Tax professionals will examine how your business is paying and reporting independent contractors and make sure that you are compliant in this area with all IRS regulations to avoid harsh penalties.

• They can look at past tax returns for deductions that have been missed or valuable credits that are available to the business.

• The tax professional can point out all manner of compliance issues that can be immediately corrected throughout the year so you have the strongest confidence going forward with all your regular business transactions.

Remember that every business is different and there is never going to a one-size-fits-all solution to tax questions and problems. This is why it is vital to have a tax professional on your side all year round to guide you through an often confusing tax code.

The tax professional will protect your business from liability and make sure you are in compliance with all major and minor regulations. They understand as a busy owner of a small to medium-sized business, you already have enough on your plate without also worrying about the mind-numbing minutiae of your business tax scheme. Let a business tax professional help you to greater business success and financial stability.

Getting A Tax Resale Certification Is One Of The Best Things You Can Do As An Entrepreneur

If you decide to start a business, a tax resale certificate can save you money on taxes.

In short, a tax retail certificate allows you not to pay sales tax on items that you plan to resell. This can also apply to supplies that are going to be used in products that you will resell, such as wood for a cabinet.

However, the process can be difficult and the rules are different for each state. That is why TaxResaleCertificate should do all the hard work for you. We can make sure that you get all the advantages of a tax resale certificate without having to deal with the hassle of government red tape. Let us handle the hard stuff so you can proceed to run your business with confidence. Make sure you check out our second blog in this series so you can learn even more valuable information about tax resale certificates.