As tax season approaches, it's crucial for business owners to take the necessary steps to ensure a smooth and accurate filing process. Here are five key areas to focus on to get yourself ready for filing season.

Familiarize yourself with your tax obligations. There are five main types of taxes your business may be responsible for, whether you run a sole proprietorship, partnership, S corporation or C corporation.

• Income tax: Income taxes are paid at both federal and state levels and are based on your business’ profits. C Corps are taxed on company profits at the 21% federal rate and again when shareholders pay taxes on dividends. Sole proprietorships, partnerships and S corps are considered pass-through entities, so profits and losses are reported on the owners’ personal tax returns. Sole proprietors file income and expenses on Schedule C of Form 1040, partnerships file Form 1065 and report profits/losses via Schedule K-1, and S corporations file Form 1120-S, with shareholders reporting income through Schedule K-1.
• Estimated taxes: If you expect to owe more than $500 in taxes for the year, you are on the hook for estimated taxes, which are due on a quarterly basis. Key 2025 estimated tax deadlines: Apr 15, Jun 16, Sept 15, and Jan 15, 2026.
• Excise tax: If your business provides communication or air transportation services, sells fuel, trucks, trailers, transports passengers by water or manufactures coal, you may owe excise taxes. The IRS has an extensive list of which goods and services come with an excise tax liability—see here.
• Self-employment taxes: If you’re a sole proprietor or active partner, you owe both employer and employee portions of Social Security (12.4%) and Medicare (2.9%) taxes. If you earn over $400, you are required to report self employed income and pay these taxes.
• Employment taxes: Do you have employees? You owe payroll taxes including social security, Medicare, income tax withholding and federal unemployment tax (FUTA).
• Sales tax- Many states require businesses to collect sales tax on goods or services, and the rules vary by state, so businesses must register for a sales tax permit, understand nexus rules, keep accurate records, and file returns.

Gather your documents: Make sure you collect all relevant financial records including income statements, balance sheets, payroll documents, receipts for all expenses, bank and credit card statements, and records of any estimated tax payments made during the year. You will also need your basic identifying information: federal tax ID number, social security number and previous year’s tax returns.

Understand common forms you may need to file:

• Schedule C: Sole proprietors use this with Form 1040 to report income.
• Schedule K-1: Used by owners of pass-through entities (S corporations or partnerships) to report income.
• 1099-MISC: Reports rental income or payments to attorneys.
• 1099-NEC: Reports non-employee compensation.
• Form 1120: C corporations use this to report income.
• Form 1120-S: S corporations use this to report income (file separately from personal tax returns).
• Form 1065: Partnerships use this information return (file separately from personal tax returns).
• Form 720: Reports excise taxes related to your business.

Understand your credits and deductions- Credits reduce the amount of tax you owe, while deductions reduce the amount of your income before you calculate the tax you owe. Business credits and deductions include opportunity zones, paid family leave credits, standard mileage rates, home office deduction, R&D tax credits, and the business expense deduction. View the full list of deductions and credits available to businesses here: https://www.irs.gov/credits-deductions/businesses

Know the deadlines- Here are the key business tax dates for 2025:

• Jan 31: Send W-2s to employees and 1099s to contractors, and submit to IRS.
• Feb 28: File 1099 or 1096 information returns.
• Mar 15: Partnerships, S corporations, and multi-member LLCs file tax returns.
• April 15: Single-member LLCs, sole proprietors, and C corporations file tax returns; First quarter estimated tax due.
• June 16: Second quarter estimated tax due.
• Sept 15: Third quarter estimated tax due; Partnerships, S corporations, and multi-member LLCs with extensions file returns.
• Oct 15: Single-member LLCs, sole proprietors, and C corporations with extensions file returns.
• Jan 15, 2026: Fourth quarter estimated tax due.