Tax Help!!

[darikfrye91]

Hello, I started my own Motorcycle and ATV repair/customization shop in Ludlow, MA called Frye & Sons Custom Cycles. I am confused about all the taxes involved with a small business and I have tried to read up on as much as I could but still don't quite understand it all. How much percentage of my money earned goes to taxes? And how do I pay it/ when do I pay it? I also work full time at a grocery storeIi do my own income tax for there every year. I use Quickbooks for my expenses, customers, invoices, Etc. but I notice it doesn't really have anything for the taxes. And since I have to pay taxes, does that mean I charge a tax percentage to my customers even through I'm not selling products, I'm selling a service? Any and all help will be much appreciated!

[vangogh]

Welcome to the forum darikfrye91. Since you did't mention a specific business entity I'm going to assume your business is set up a sole proprietorship. Your business is services based so you probably don't need to add sales tax, however that really depends on your state. Some services are taxable. Usually the Secretary of State website (http://www.sec.state.ma.us/) (the link takes you to the site for Massachusetts) has good information. It looks like Massachusetts has an official website for the commonwealth (http://www.mass.gov/portal/business/) and it looks like it'll have more of the answers you need.

As far as paying taxes again, I assume you're a sole proprietor and your questions related to paying estimated taxes. Check IRS form 1040ES (http://www.irs.gov/uac/Form-1040-ES,-Estimated-Tax-for-Individuals-1). There's some instructions as to what you have to pay, though typically you want to pay enough to not owe money come April 15th. That'll be dependent on how much your business makes and it'll get easier each year.

Hope that helps.