How JustAnswer Works:

  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.

Ask DanielleCPA Your Own Question

DanielleCPA
DanielleCPA, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 695
Experience:  Years of Experience in Business & Personal Taxes
50747609
Type Your Tax Question Here...
DanielleCPA is online now
A new question is answered every 9 seconds

Hi I dont file my taxes and I want to start a new business

Resolved Question:

Hi I dont file my taxes and I want to start a new business and I want to incorporate what do I need to know and how do I go about this
Submitted: 1 year ago.
Category: Tax
Expert:  DanielleCPA replied 1 year ago.

DanielleCPA :

Welcome and thanks for your question!

DanielleCPA :

By don't file taxes, do you mean that you aren't currently required to file taxes?

Customer:

No Its the law to but I get paid under the table

Customer:

So ill have to pay Im sure causr im single and no kids

DanielleCPA :

Ok. Is the new business unrelated or are just incorporating what you are doing in your current line of work?

Customer:

Unrelated

DanielleCPA :

Ok.

DanielleCPA :

Your first step should be to file Articles of Incorporation with the California Secretary of State. There is a $100 fee and you can use this form. Some people choose to have an attorney help them with this step.

DanielleCPA :

Your next step will be to obtain a Federal Employer Identification Number. You can complete the application online at the IRS website. They will issue you a new FEIN immediately.

Customer:

Okay then what

DanielleCPA :

Register for California taxes.

DanielleCPA :

Give me a moment - I'm trying to find a good link for you with that info.

DanielleCPA :

If you will be making sales subject to sales tax, you will need to register with the State Board of Equalization. Information on that registration process and a link to the online registration can be found here. If you will have any employees (including yourself if you will be paying yourself as an employee with a W2), you will also need to register for payroll taxes. You can register online here and detailed information on that process will be found here.

DanielleCPA :

If those taxes apply, you will need to file periodic returns (could be monthly, quarterly, annually) based on the frequencies assigned to you by those agencies.

DanielleCPA :

Note you will also need to file annual corporate income tax returns with the IRS and the California Franchise Tax Board, but there is no separate process for that. California has a minimum $800 annual tax, but they waive that in the first year.

DanielleCPA :

Here is a nice guide from the Franchise Tax Board for new businesses.

DanielleCPA :

You may wish to make an election for the Corporation to be treated as a S Corporation. This offers the advantage of not paying tax at the federal level, although a corporate tax return is not required. The income of S corporation passes through to the owners and is reported on their personal 1040s. You can make an S election using Form 2553.

DanielleCPA :

Do you have any questions on the above information?

DanielleCPA :

That covers the process and the recurring requirements - please let me know if you need clarification on any of this.

Customer:

Okay thank u

DanielleCPA :

You're welcome.

Customer:

So a s corporation is my best bet then

DanielleCPA :

In my opinion, yes. It is a great option for small business owners.

DanielleCPA :

One clarification - I see a typo in my answer above. Corporate tax returns ARE still required for S Corps. There just is no tax on the federal level. In California, you are still subject to the $800 tax.

DanielleCPA :

A S Corp is still your best bet, though, in my opinion.

DanielleCPA :

It offers you much more flexibility in withdrawing funds than a traditional C Corp.

Customer:

Oh okay ill go read if I have more questions u will be hearing from me thanks agian

DanielleCPA :

You're welcome.

DanielleCPA, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 695
Experience: Years of Experience in Business & Personal Taxes
DanielleCPA and other Tax Specialists are ready to help you
Expert:  DanielleCPA replied 1 year ago.
Our chat has ended, but you can still continue to ask me questions here until you are satisfied with your answer. Come back to this page to view our conversation and any other new information.

What happens now?

If you haven’t already done so, please rate your answer above. Or, you can reply to me using the box below.

JustAnswer in the News:

 
 
 
Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.
 
 
 

What Customers are Saying:

 
 
 
  • I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response... T.G.W Matteson, IL
< Last | Next >
  • I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response... T.G.W Matteson, IL
  • I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight. Bonnie Chesnee, SC
  • Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation. John Minneapolis, MN
  • Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with. Orville Hesperia, California
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C. Freshfield, Liverpool, UK
  • This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!! Alex Los Angeles, CA
  • Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult. GP Hesperia, CA
 
 
 

Meet The Experts:

 
 
 
  • Wallstreet Esq.

    Tax Attorney

    Satisfied Customers:

    570
    10 years experience
< Last | Next >
  • http://ww2.justanswer.com/uploads/KU/KUMI95/2013-9-30_195031_kumar.64x64.jpg Wallstreet Esq.'s Avatar

    Wallstreet Esq.

    Tax Attorney

    Satisfied Customers:

    570
    10 years experience
  • http://ww2.justanswer.com/uploads/CU/Cuttinggirl/2011-10-29_03719_wcrop2.64x64.jpg Wendy Reed's Avatar

    Wendy Reed

    Enrolled Agent

    Satisfied Customers:

    3052
    15+ years tax preparation and tax advice.
  • http://ww2.justanswer.com/uploads/CATax/2009-08-04_204548_Mark.jpg Mark D's Avatar

    Mark D

    Enrolled Agent

    Satisfied Customers:

    985
    MBA, EA, Specializing in Business and Individual Tax Returns and Issues
  • http://ww2.justanswer.com/uploads/IN/insearchoftheanswer/2013-8-16_0233_attorney.64x64.jpg Richard's Avatar

    Richard

    Tax Attorney

    Satisfied Customers:

    3229
    29 years of experience as a tax, real estate, and business attorney.
  • http://ww2.justanswer.com/uploads/MY/MyVirtualCPA/2012-7-5_44024_cookmegan1.64x64.jpg Megan C's Avatar

    Megan C

    Certified Public Accountant (CPA)

    Satisfied Customers:

    6121
    Licensed CPA, CFE, CMA who teaches accounting courses at Master's Level
  • http://ww2.justanswer.com/uploads/JG/jgordosea/2012-6-7_43138_GordosVeritas.64x64.jpg jgordosea's Avatar

    jgordosea

    Enrolled Agent

    Satisfied Customers:

    2783
    I've prepared all types of taxes since 1987.
  • http://ww2.justanswer.com/uploads/OZ/ozaukeecpa/2012-6-7_193219_Picture1croppedandshrunk.64x64.jpg MequonCPA's Avatar

    MequonCPA

    Certified Public Accountant (CPA)

    Satisfied Customers:

    2231
    CPA, Over 30 yrs experience w/individuals and small businesses. Masters in Tax.