How much should you put aside for taxes?
I have an LLC located in the US. As I've never done this before, I'm wondering what is a good rule of thumb concerning a percentage of revenue to put aside for taxes?
Our LLC is based in Texas, we have no employees and two managing members and no inactive members. This is our first year in business, so from what I understand we start paying quarterly next year after we know what our revenue is this year.
-
You may want to migrate this to money.stackexchange – Gef05 13 years ago
1 Answer
It's a very complicated answer that depends on many different variables.
You should find yourself an accountant fast. He/she will walk you through all the tax issues you will have and help you with paperwork and filing taxes correctly.
I know it can seem like a costly thing to have to get but trust me when I tell you that the money you spend on professional help is a lot less then screwing things up and having the gov't come after you because you didn't do your taxes correctly.
-
It's actually not that hard - just set aside your personal rate on the profit. If that is too complex, just set aside the tax rate on the revenue. It is pretty simple. – Tim J 13 years ago
-
@Tim he didn't give many details... depending on his location he may be legally required to pay quarterly to local city taxes for the business. Does he have any employees? He'll need to do paperwork and pay their taxes to the IRS. – Alan Barber 13 years ago
-
Yeah - but I thought he just wanted to know how much to set aside. If he has employees then there is a whole set of other issues that he should be asking - set aside for taxes is the least of his worries then. – Tim J 13 years ago
-
I will say though that your advice to get an accountant is the right thing to do. – Tim J 13 years ago
-
If you are earning any significant amount of money from your LLC (over $500??) I'm pretty sure you have to pay estimated taxes quarterly. He needs that accountant right away. – Gary E 13 years ago
-
Thanks guys, added more details. – James 13 years ago
