The Top Taxes You Pay For As A Businessman

Running a business is expensive. Not only do you have to worry about the cost of goods or services, but you also have to pay taxes. There are federal, state, and local taxes that all businesses must pay.

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Here are the top 13 taxes you pay as a businessman:

1. Income Tax:

 

This is the tax you pay on your business’s net income. The rate can vary depending on the type of business and its location.

 

All businesses are required to pay income tax on their profits. The current corporate income tax rate is 21 percent. Individual income tax rates range from 10 percent to 37 percent.

2. Payroll Tax: 

 

This tax is imposed on the wages paid to employees. The rate can vary depending on the state in which the business is located.

 

Businesses are also responsible for paying payroll taxes. These include Social Security and Medicare taxes, which are imposed on all employees. The current Social Security tax rate is 6.2 percent for both employers and employees. The Medicare tax rate is 1.45 percent for both employers and employees.

3. Property Tax: 

 

This tax is imposed on the value of property owned by the business. Property taxes are imposed on all business properties, including office buildings, factories, and retail stores. The tax rate varies depending on the location of the property.

4. Sales Tax: 

 

This tax is imposed on the sale of goods or services. The rate can vary depending on the state in which the business is located.

5. Use Tax: 

 

This tax is imposed on the use of property or services purchased from outside the state in which the business is located.

6. Business License Tax: 

 

This tax is imposed on businesses for the privilege of operating in a particular jurisdiction. The rate can vary depending on the type of business and its location.

7. Franchise Tax: 

 

This tax is imposed on businesses that are part of a larger organization, such as a franchise. The rate can vary depending on the type of business and its location.

8. Excise Tax: 

 

This tax is imposed on the sale of certain goods, such as alcohol and tobacco. The rate can vary depending on the state in which the business is located.

9. Personal Property Tax: 

 

This tax is imposed on the value of personal property owned by the business. The rate can vary depending on the municipality in which the business is located.

10. Estate Tax: 

 

This tax is imposed on the value of a person’s estate after their death. The current rate is 40 percent. The rate can vary depending on the state in which the business is located.

11. Capital Gains Tax: 

 

Businesses that sell assets such as stocks or real estate may be subject to the capital gains tax. The current rate is 20 percent.

12. Alternative Minimum Tax: 

 

The alternative minimum tax is a tax imposed on businesses that have certain types of income that are not subject to the regular income tax. The current rate is 20 percent.

13. Gift Tax: 

 

The gift tax is imposed on the transfer of property during life. The current rate is 40 percent.

More on gift tax Australia here. 

 

As you can see, there are many different taxes that businesses must pay. It is important to understand all of these taxes so that you can properly budget for them.

 

Failure to pay any of these taxes can result in severe penalties, so it is important to stay on top of them.

 

Taxes are never fun, but they are a necessary part of running a business. By understanding the different types of taxes you will have to pay, you can make sure that your business is prepared for them.

 

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