We know taxes can feel like a foreign language (with way too many forms and deadlines). But you’re not alone—small business owners have so many questions about taxes every year. Mainly: How do small business taxes work? 

Well that depends on your business type, but most owners pay income tax, self-employment tax, and possibly payroll or sales tax. Some file business taxes with their personal return (like sole proprietors), while others file separately (like corporations).

Ready to clear more things up? Here are answers to some of the most common tax questions we hear.  

How can I make tax time less stressful?

Two words: stay organized. Keep track of your income and expenses all year—whether that’s in a simple spreadsheet or using accounting software like QuickBooks. A lot of income sources and payments come with tax forms (think 1099s, W-2s, etc.), and most of them hit your inbox or mailbox in January. Stick them all in a folder (digital or physical), and when tax time rolls around, you won’t be scrambling to find that one form that mysteriously disappeared.  

What info do I actually need to file my taxes? 

For your biz, you’ll need to report:  

✔️ All sales income (yes, even those Venmo payments)  

✔️ Business expenses (supplies, software, contractor payments, etc.)  

✔️ Any other business-related income (interest, grants, etc.)  

If you’re also filing personal taxes, grab documents for:  

– Wages, dividends, stock sales  

– Rental income and expenses  

– Tuition + student loan interest  

– Mortgage interest + real estate taxes  

– Retirement contributions  

– Medical + childcare expenses that weren’t reimbursed  

If you have online accounts (like for your mortgage or investments), log in and check the “Documents” or “Tax Forms” section—most of what you need will be in there.  

When should I send in my tax stuff? 

As soon as you have everything! Your tax pro can’t start until they have all your documents, so the earlier you send them in (and answer any follow-up questions), the faster your return gets done.  

How long will my tax return take? 

It depends! If everything is in order and no extra questions pop up, a standard return usually takes about two weeks (at least here at Patton). But if your tax pro is waiting on missing documents or clarification, that can stretch things out. Moral of the story? Send everything in early and reply to any questions ASAP.  

Do I need to send 1099s to contractors?

If you paid an independent contractor at least $600 for services (not products), then yep, you need to send them a 1099-NEC. BUT:  

– If you paid them through a business PayPal, Stripe, Square or another payment processor, you’re off the hook—those companies send 1099s for you. (note: Zelle and personal Venmo accounts count as cash apps, not payment processors, so you still have to send 1099’s if you used those apps.)

– If they’re a corporation (LLCs don’t count), you don’t need to send one either. Always double-check their business setup before sending.  

Why isn’t my tax return done yet?

Usually, it’s because something is missing—like a document or an answer to a tax pro’s question. If your tax return is in limbo, check your inbox and make sure you’ve sent over everything they need!  

What if I find a tax form after I already filed?

Oops—it happens. If you realize you left something off your return, you might need to file an amended return. Reach out to your tax preparer or check with the IRS to see what needs to be done.  

How do I file a Franchise Tax Return or Annual Report?

These aren’t part of your regular tax return—they’re filed separately through your state. Check your state’s department of revenue or secretary of state website for all the details.  

Still got questions?

For general tax info, check out IRS.gov. If you need expert help, reach out to a tax pro (like us!) or slide into our DMs on Instagram (@patton.accounting).