by cdaaccounting | Nov 16, 2021 | Business Deductions
Understanding cash and retained earnings can be confusing. These earnings in a business are not equal to cash, this is money in the bank. Just because an Idaho company has kept profits in the business over the years does not mean that all of these profits have been retained in the form of cash.
After an Idaho company earns a profit it may take that cash and purchase assets or pay off some of its liabilities (expenses, loans, bills etc.). Business owners often assume that they are doing well because they are making profits without considering the amount of cash they have at their disposal. If they do not have sufficient cash, they will find themselves in dire since they may not be able to make the payroll, pay their taxes or general bills.
- It is essential that businesses have a good cash management plan.
by cdaaccounting | Nov 8, 2021 | Business Deductions
No. An Idaho LLC is a pass-through company and considered a disregarded entity to the IRS. This means that all profits come through to the owners/shareholders first to be taxed on their individual income taxes.
While your taxes will change, the facts, ownership, and management structure will not.
by cdaaccounting | Oct 20, 2021 | Business Deductions
The IRS does not have a separate taxation category for Idaho LLCs. This allows the LLC members to elect at their own discretion a form of taxation that makes the most sense for their business.
While your taxes will change, the facts, ownership, and management structure will not.
For example, if you elect to have your Idaho LLC taxed as an S or C-Corporation, you will not have shares of stock to sell, or be qualified for an IPO. To receive the full benefits of an Idaho Corporation, you must formally convert your entire LLC.
Taxation choices include:
- Sole Proprietorship (single-member)
- Partnerships (two or more members)
- S-Corporation (single or multi-member)
- C-Corporation (single or multi-member)
by cdaaccounting | Oct 16, 2021 | Business Deductions
The federal income tax system is pay-as-you-go for Idaho self-employed. instead of paying your entire tax bill when you file your return, you pay your taxes in smaller payments throughout the year. This was designed to break your tax bill down into smaller easy to digest payments, instead of one large surprise you can’t afford at the end of the year.
Thus, if you are self-employed, you must administer the pay-as-you-go system yourself. You do so by paying quarterly estimated taxes.
The Basics:
You must pay quarterly estimated taxes if you have income from any of the following sources:
- Income from self-employment
- Compensation as an Idaho independent contractor
- Gains from the sale of stock or other property
- Royalties
- Interest
- Dividends
- Awards
- Any income where tax was not withheld
You must pay estimated taxes only if you owe $1,000 or more of tax at the end of the year more than what you have paid through employee withholding.
Example
Let’s say that you owe $13,000 in taxes at the end of the year, and you have already paid $11,000 through withholding – and $0 in estimated taxes. Because your tax liability is $2,000 greater than what you paid, you will face penalties for your failure to pay estimated taxes.
by cdaaccounting | Sep 16, 2021 | Business Deductions
Contact your local CDA printer and have VIC (Very Important Customer) cards printed that entitle the cardholder to terrific discounts on products and services the: your Idaho business sells as well as access to special any VIC promotions that you create throughout the year, such as free product or service training workshops, special manufacturers discounts, and VIC appreciation parties and events.
Giving Incentive
Create and distribute VIC cards as a way to thank your best customers and secure new customers, as well as bolster sales and profits. Distribute the VIC cards to customers and employees and let them in turn give them to` friends and family members as a special gift. Also make sure to include a line on the card where the giver can sign their name, so you can gift that person with something for helping to promote your Idaho business by distributing your VIC cards. A special incentive to show that you appreciate their hard work and effort, VIC cards are a powerful marketing tool that just about every business can benefit from. They are very inexpensive to have printed professionally; you can even design them on your PC and print them yourself if your budget is tight.