the small business resource center

Business Taxes

Some of the most complex issues facing small business owners today are the various taxes and tax structures. Your business may be subject to, or responsible for, collecting or withholding the following taxes. Click on the links for details.

• Income Taxes on the business itself (below)
• Sales and Use taxes
• Employee-Related taxes
• Ad Valorem taxes (taxes on property)
• Motor Vehicle taxes

The IRS will furnish the compact disc (CD) Small Business Resource Guide (IRS Publication 3207) on request. It contains all of the business tax forms, instructions, and publications you will need as a small business owner. You can get a free copy of the Small Business Resource Guide by calling the IRS at (800) 829-3676, or click here to find it online. Search for “Small Business CD”.

The Alabama Department of Revenue has a publication titled Starting a Small Business that details all state tax guidelines for small businesses. Click here to find it online.

Income Taxes on the Business

Every business is taxed on its income. Businesses typically submit estimated tax payments. Estimated tax payments may be paid in full or in equal installments on or before April 15, June 15, September 15, and January 15. It is highly recommended that you get a separate bank account in which to immediately deposit your estimated taxes.

Federal Taxes

Income from proprietorships, partnerships or other unincorporated businesses is subject to individual income taxes of the owners using form 1040 with appropriate schedules. Incorporated businesses are subject to U.S. corporate income tax laws. For further information click on Internal Revenue Service.

State Taxes

Like the federal income tax, the state also requires that income from proprietorships, partnerships or other unincorporated businesses be taxed at the state individual income tax rate of the owners. In Alabama, both foreign and domestic corporations are subject to a net Income Tax and Business Privilege Tax. Several useful publications are available click on Alabama Revenue Department.

Click here for Taxpayer Service Center locations and phone numbers. For information on city and county taxes, contact the appropriate city and county offices.