If you’re new to eCommerce you might be scratching your head when it comes time to file 2016 taxes. What taxes do you have to pay as an online seller? When are they due? What are you supposed to do with that Form 1099-K you got in the mail? And what the heck is “nexus”?!
Whether you’ve just started selling products on your own website or a marketplace like eBay, Etsy or Amazon, this eBook can serve as a starter guide to help you file 2016 taxes. It outlines the tax basics for online sellers to make the process more manageable — so you can spend less time wrestling with taxes and more time growing your eCommerce business.
Check out the online sellers’ guide to filing 2016 taxes
View our eCommerce Tax Time Primer … then read on for some highlights.
Learn the ins and outs of annual federal taxes
Unless selling online is your first job, you’re probably familiar with filing your personal income taxes every year on April 15 or thereabouts. It’s not so different now. But as an online seller, in addition to the usual personal income tax Form 1040, you also have to file a form called a Schedule C to report self-employment income.
If you intend to make a profit, depend on the income, or have made money the last three out of five years, you have a business — not a hobby. You’re considered self-employed.
If your net earnings from self employment were $400 or more, you must file an income tax return.
Download our eCommerce Tax Time Primer to learn:
- The best way to figure out how much you owe.
- When you need to pay.
- Handling Form 1099-K.
- How to file 2016 taxes, including filing an extension.
- Links to additional resources, like important IRS forms.
Bonus: Get the scoop on deducting startup costs.
Get the lowdown on quarterly estimated taxes
When you join the ranks of the self-employed, you actually have to pay taxes each quarter. That’s because you don’t have an employer withholding taxes from your paycheck for Uncle Sam. It’s up to you to remit taxes to the government each quarter.
Download the eBook for information about:
- Calculating quarterly estimated taxes.
- How to file, including how to enroll in the Electronic Federal Tax Payment System.
- What to do if you miss a deadline.
Understand state sales taxes
If you sell a product online, and have a physical presence in a state (aka “nexus”) that collects sales taxes, you’re probably required to charge a percentage of sales tax on every sale you make.
Check out the eBook to learn:
- How to figure out if your business qualifies as a physical presence.
- What states charge sales tax, and how much.
- How storing your goods in Amazon fulfillment centers affects your state sales taxes.
- Tips for figuring out how much you owe.
… and much more.
Make it easier to file 2016 taxes
Running your own business is hard enough — give yourself a break at tax time by using this nifty little guide. And, if you really want to take eCommerce taxes by the horns, use a tool such as GoDaddy Online Bookkeeping to track sales and expenses, pre-populate your Schedule C, and more. Think about how much more time you’ll have to grow your eCommerce venture!