When you start your own business, setting up some important accounts is crucial. Knowing what your business is supposed to do with the money you collect - before you make your first sale, makes it much easier to pay the necessary taxes in a timely manner. As an entrepreneur, there are a few steps you need to take to get necessary accounts set up. In this article, we’ll share what they are and how to get your business off to a great start!
Get Your Tax ID Number
After you have established your business entity, it is time to get a Tax ID Number. This is the company's Employee Identification Number (EIN). The EIN or Tax ID Number is used to identify a business and is required for licensing and permitting. Having an EIN is also required to open a business bank account. So, having a Tax ID Number is one of the first steps to take when you start a new business.
Enroll in EFTPS
The Electronic Federal Tax Payment System (EFTPS ) is a free service from the U.S. Department of the Treasury. All federal taxes can be paid using EFTPS. Since it began in 1996, millions of businesses, individuals, federal agencies, tax professionals, and payroll services have used EFTPS. The filing process for a new EIN or Tax ID Number may be confusing, but professionals can assist you to make it easier.
State Tax
Your business will need to meet its state tax obligations to stay in good legal standing. The location of the business and business structure will influence which taxes your business has to pay. Ongoing state filing requirements must also be clearly understood by business owners after initially setting up your state tax. Hiring a professional can help relieve the stress of staying up-to-date on all of the licenses, permits, recertification documents, and other documents necessary to stay in good legal standing.
Sales Tax
When your business sells a product or provides a service that is table, and the business is in a sales tax state, you need to set up a process to collect sales taxes, pay sales taxes, and file sales tax returns on time.
Some states, such as Alaska, Delaware, Montana, New Hampshire, and Oregon do not charge sales tax. But, for businesses operating in the other states, you must collect, report, and pay sales taxes on the products or services you sell.
If your business is selling in Alaska, Delaware, Montana, New Hampshire, or Oregon, no sales tax is charged, so you don't have to worry about this process. If you own a business that operates in the other states, you need to correctly set up sales tax processes. Also, if you sell online, you may have to collect sales tax from customers in many states.
Call Paul's Bookkeeping and Tax Service for Assistance
Getting your EIN, setting up your state and sales tax, and enrolling in EFTPS is easy when you work with Paul's Bookkeeping and Tax Service. Call (806) 352-6085 today to get started!
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