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What You Need To Know About LLC Taxes In Kansas
When you open an LLC, the most difficult part of the process is making sure that you have all of your tax paperwork in order. Everything from setting up an LLC to most of the different functions an LLC performs comes with various different taxes. Thankfully if you know what to look for you can plan ahead and take part of your income and set it aside for any fees or taxes that come up the next year. Planning ahead makes sure that you don’t get surprised by taxes you didn’t know you owed and that you are able to continue legally trading.
Annual Report Fee
In Kansas, you must file an annual report about the state of your LLC ensuring that you are up to date on your taxes, that you are properly recording interactions, and that you have registered your name and purpose with the state. This is when you will update any information integral to the formation of your corporation, including changes in ownership, location, and stated purpose. Each year this report must be submitted by the middle of April but may be submitted as early as the first of January should you so wish.
The fees for filing this report are set at $50 online and $55 in person for the year 2021 and are subject to increase or change each subsequent year. Make sure to check with the government website before filing to ensure proper payment of this fee.
Should you select to have your company taxed as a standard corporation rather than having the tax burden placed upon you as an individual it will be taxed at the standard rate for the state of Kansas. As of 2021, this rate is a flat 4% of federally determined income as well as a 3% tax on income above $50,000. Should your company not reach the $50,000 threshold after standard deductions you will only pay the 4% rate and will not need to worry about pro-rating the rest of the income to ensure proper payment.
Employment taxes must be paid, but also must be withheld from pay properly to ensure that your employees don’t run into any issues when filing their taxes. This rate changes based upon your physically registered location, but must include both the federal and state-required amount as well as any amounts required by the state or county in which your LLC is registered. Information about these rates is available online on your local government website and will generally be available in most paycheck processing software so you don’t have to physically calculate the amounts for each pay period. Ensure that the amount calculated within the software is correct or you will have to adjust the amount at the end of the year.
Once you have collected the tax amount from your employees you must pay it out to the federal, state, and local tax authorities as required within your locale. Additional requirements such as state-unemployment insurance and any other tax schemes that you are required to pay into will also need to be reconciled in the same way. Employees are not responsible for their own tax burden and any mistakes on paperwork will rest solely at the feet of the LLC in question.
Individuals within the LLC will be required to pay federal income tax on money that they acquire through the LLC. This means that the individual in charge of the corporation will be responsible for the bulk of the tax burden. Keeping company payment information separate from that of individuals ensures that tax is paid only on actual income and not on money invested in the business venture.
Registering Your LLC Elsewhere
The final taxes that you might be required to pay are those for registering your LLC somewhere else. Whether you are registering in another state where you have a local office or trying to take yourself internationally, the same tax rules will apply. Keep income for different locations separate if possible to make tax paperwork easier. Generally, if you only conduct business in other states but maintain your presence in a single state you must register in the other states but pay all other taxes in the state you maintain your business presence within. If you are worried or confused about possible tax implications you should consult with an accountant to ensure you are meeting all requirements.
For the most part, your LLC pays taxes like any other corporation or entity. The default rates for your state apply, making it easy to figure out what you owe. Most tax software and point of sale systems will be able to calculate your costs and keep track of the information that you need for the end of the year filing. Ensuring that you accurately record all money that comes in and out of your company will ensure that you are not charged extra at the end of the year. Utilizing the services of a certified accountant is generally advised as they are knowledgeable about possible tax breaks, grants, and other opportunities that you may qualify for.