When you are faced with business tax planning issues, working closely with an attorney who will explain clearly all options and consequences can help to ensure that you make decisions that are in your business' best interests. Contact our firm today to schedule a consultation with an experienced tax attorney.
Experienced Taxation Lawyers in Columbia, Maryland
For any business, making responsible and informed decisions about tax planning is critical and can save you significant amounts of time, money and frustration. At the Thienel Law Firm, LLC, our attorneys work with clients from across Maryland, and regarding federal IRS taxes, throughout the United States. Our attorneys can assist your business in creating a complete tax plan.
Talk with us about your business needs to get the personalized assistance you deserve. Contact the Thienel Law Firm, LLC, by sending us an e-mail describing your needs or by calling us at 443-535-9715. Schedule a confidential consultation at our Columbia, Maryland, office.
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All businesses, small, medium or large, must plan for all potential tax obligations and be informed about which state, federal and local taxes you may have to pay. The Thienel Law Firm, LLC, can assist your business with its tax planning needs.
In addition to tax planning, our lawyers can represent you in disputes and assist your business in other areas of business formation and administration. Contact the Thienel Law Firm, in Columbia, Maryland, for more information about our comprehensive business law services.
Tax Laws Affecting Businesses
A tax is a compulsory payment by an individual or business entity to a governmental body. Federal, state, city, county and other governmental entities impose taxes on both businesses and individuals. A business must plan for all of these potential tax obligations. A tax attorney at Thienel Law Firm LLC in Columbia, Maryland, can advise your business about applicable state and local taxes to which your business may be subject.
Types of Taxes
In addition to income tax, the following types of taxes should be considered as part of a business' tax planning strategy:
Employment tax — A business with employees must pay federal employment taxes. Federal employment taxes include the federal unemployment tax, federal income tax withholdings, Social Security and Medicare. The federal unemployment tax is paid from the employer's own funds; employees do not have this withheld from their pay. Employers withhold Social Security and Medicare taxes from employees and also pay a matching amount.
Self-employment tax — Self-employed individuals must pay a federal self-employment tax, which is basically the same as the Social Security and Medicare taxes that are withheld from employees' pay. The self-employment tax rate is 15.3% (12.4% for Social Security and 2.9% for Medicare). Individuals use Schedule SE (Form 1040) to compute the tax. Individuals can deduct half of the self-employment tax when computing their adjusted gross income.
Payroll tax — A tax, which includes Social Security and Medicare, that an employer withholds from employees' pay checks and sends to the government. Employers use a Form W-4, completed by employees, to determine how much to withhold.
Capital gains tax — A capital gains tax is a tax on profits from the sale of a capital asset, such as stock, bonds, mutual funds and real estate. A business owner who holds stock in a corporation and sells it for a profit will have to pay capital gains tax. In addition, if a business sells real estate or bonds that it held, it may be subject to the capital gains tax.
Sales tax — A tax levied by a state or city government on the retail price of an item that is collected by the retailer and passed on to the government.
Excise tax — A federal excise tax is a tax that must be paid when purchases of specific goods or products (for example, gasoline) are made. The excise tax is often included in the product's price.
Estate tax — An estate tax is a tax imposed on the transfer of property from a deceased person to his or her heirs; also called death tax. Individuals who own controlling interests in a closely held business that is not traded publicly may want to plan for passing on that interest to an heir in a way that minimizes the tax on that transfer.
Gift tax — There is a federal tax on any gift from one person to another that exceeds $12,000 in one year. Gifts to tax-exempt charities and to a spouse are generally exempt. A shareholder in a corporation may wish to give his or her shares to another person. A tax attorney can provide an explanation of the gift tax laws and help individuals minimize gift tax liability.
Property tax — Local governments typically assess a tax on real property. The tax is generally based on the value of property. Businesses that own their offices or other buildings may be subject to property tax.
Conclusion
A business can be subject to a variety of taxes imposed by the federal government, states, cities, counties or other governmental entities. These taxes must be considered, and the business should have a plan in place for complying with these requirements. A tax attorney at Thienel Law Firm LLC in Columbia, Maryland can answer questions about these types of taxes.
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