In preparation for the tax season, you will need to gather your financial documents. Self-employed individuals must set aside money to pay directly to the IRS. If you are inexperienced, then you can benefit from CPA tax preparation services. From finding out your state requirements and determining your payment to determine when to pay your state taxes, you may have many questions. Read on to find out if you need to pay taxes for your state.
Find the Requirements for Your State
CPA tax preparation services can help you find the resources to learn more about your state taxes. Forty-three states require their residents to pay a personal income tax. You can visit USA.gov to find out if your state is one of them.
Determine the Amount
It is more difficult to determine the amount you must pay. Many states have different tax rates depending on your filing status. The amount is usually around 5% of your income. However, it helps to talk to a certified public accountant to get exact figures.
Schedule Your Payments
If you are self-employed, then you have to pay a self-employment tax, income tax in addition to your state tax. You have the option of making the payments quarterly or in one lump sum payment. It helps to write the dates down on your calendar to make sure you make the payments on time.
As you can tell, these are some of those bookkeeping things you have to take care of when working as a sole proprietor. After finding out your state requirements, you should send your payment before the tax deadline date. If you live in a state with an income tax, then you have to pay state taxes. Contact InSiteCPAs to get started today!
