Just Started A Business? Understand Your Tax Obligations

If you’re new to business, then wrapping your arms around your tax obligations can seem like an uphill task. The first question you need to ask yourself is which tax laws impact your business from the get-go? It may be safe to assume that your tax obligations kick in once you start making a profit. Not necessarily. Each business is different.


If you hire employees, you’ll have payroll tax obligations. If you operate a retail business, there’s sales tax to deal with. Then there are quarterly estimated tax payments (the self-employed equivalent of withholding).

To help you navigate the business tax landscape, here’s a quick overview of key tax obligations that may impact you.

Understand how your Business Structure Impacts your Tax Obligations

How you legally structure your business will affect your tax situation. For example, if your business is an LLC, the LLC gets taxed separate from the owners. While sole proprietors report their personal and business income taxes on the same form (Form 1040).

At the state level, you will encounter several tax obligations – sales tax, property tax, income tax, unemployment insurance tax, and more. The SBA offers more information on how your business structure determines your tax obligations (plus links to the necessary forms and portals for registering your business with the right tax authority):

  • Determine your Federal Tax Obligations
  • Determine your State Tax Obligations

Continue reading Just Started A Business? Understand Your Tax Obligations

Choose Your Business Structure

The business structure you choose will have legal and tax implications. Learn about the different types of business structures and find the one best suited for your business.


  • Sole Proprietorship

    A sole proprietorship is the most basic type of business to establish. You alone own the company and are responsible for its assets and liabilities. Learn more about the sole proprietor structure.

  • Limited Liability Company

    An LLC is designed to provide the limited liability features of a corporation and the tax efficiencies and operational flexibility of a partnership. Learn more about how LLCs are structured.

  • Cooperative

    People form cooperatives to meet a collective need or to provide a service that benefits all member-owners. Learn more about how cooperatives are structured.

  • Corporation

    A corporation is more complex and generally suggested for larger, established companies with multiple employees. Learn more about how Corporations are structured.

  • Partnership

    There are several different types of partnerships, which depend on the nature of the arrangement and partner responsibility for the business. Learn more about how these are structured.

  • S Corporation

    An S corporation is similar to a C corporation but you are taxed only on the personal level. Learn more about how S corporations are structured.

How To Start A Business

Starting a business is an exciting proposition, but it’s also an incredibly challenging undertaking. The resources in this section will help you learn about what it takes to start a business.


  • What characteristics do you need to be an entrepreneur? What does it take to start and succeed in business?

  • 20 Questions Before Starting

    Starting a business can be the most important decision you make in your life. Ask yourself these 20 questions to begin your preparation and planning.

  • 10 Steps to Starting a Business

    These 10 steps can help you plan, prepare and launch your business.

  • Understand Your Market

    To run a successful business, you need to learn about your customers, your competitors and the economic conditions in your industry.

  • Business Data & Statistics

    Get access to data and statistics on your competitors, industry and target customer groups.

  • Business Types

    One of the first decisions you will make is the type of business you will open. Before making your decision, explore the opportunities that are available like a home-based or online business.

  • Find a Mentor or Counselor

    When starting a business, advice from SBA partner organizations such as SCORE Mentors, Small Business Development Centers and Women’s Business Centers can help you avoid common pitfalls.

3 Steps To Finding A Business Mentor

Great business mentors can have an enormous impact on early-stage startups. Their connections can open doors that would otherwise be closed and their experiences can save entrepreneurs from suffering from the same startup mistakes they’ve already made.


Here are three steps for finding the most experienced mentor to help bring your startup idea to the next level:

1. Recognize what makes a great mentor.
At TechStars, we’ve found that the best mentors are those who ask a lot of tough questions and challenge you to exceed your goals. In doing so, they should share their own experiences and help you uncover new opportunities.

But the best mentors shouldn’t tell you exactly what to do. They understand their role as an advisor and that it’s your company to run, not theirs. Those who tell entrepreneurs what to do, and become upset when their instructions aren’t followed, often cause more damage than good.

2. Find a good fit.
A common mistake we’ve seen is going straight at the busiest, most well-known, most visible mentors. While this may occasionally work, it’s often more productive to analyze your own close network and look locally for mentors whom you respect with relevant experience.

To make that first connection, you might try sending a short email explaining what your startup is doing and why you are reaching out. Avoid “form” emails and always make it relevant and easy for the prospective mentor to help. Take a few minutes to read the person’s blog or Twitter account and learn about his or her background so you can personalize your note. Continue reading 3 Steps To Finding A Business Mentor