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  1. #1

    What do we report a webhosting company as on our taxes in the US?

    Hi, my apologies if this question has been asked before, if it has please kindly point me to the right forum thread.

    If not can someone please help me.

    I just started a webhosting company and was wondering what do I report this as when I file taxes? Extra income? Since it is all run online and there is currently no physical business address.
    I am running it totally out of my apartment right now.

    Thank you,
    Max
    <<snipped>>
    Last edited by bear; 09-29-2013 at 08:21 PM.

  2. #2
    Join Date
    Jun 2006
    Posts
    949
    Depends on how your business is set up. Are you a sole proprietorship, LLC, Corporation? I'm guessing you're just a sole proprietorship, so you're generally going to put it on the 1040 Schedule C/C-EZ and Self-Employment tax on Schedule SE on your federal income taxes. You likely have state taxes to pay as well, depending on where you live.

    Whether you have a physical business address or not has absolutely no bearing on where you pay taxes. Your house/apartment/etc. is your place of business, and you would pay to that state.

    That said, you should absolutely consult a business account/attorney and ask these questions. Starting a business is something that isn't to be taken lightly. Start it properly.

  3. #3
    Quote Originally Posted by wswd View Post
    Depends on how your business is set up. Are you a sole proprietorship, LLC, Corporation? I'm guessing you're just a sole proprietorship, so you're generally going to put it on the 1040 Schedule C/C-EZ and Self-Employment tax on Schedule SE on your federal income taxes. You likely have state taxes to pay as well, depending on where you live.

    Whether you have a physical business address or not has absolutely no bearing on where you pay taxes. Your house/apartment/etc. is your place of business, and you would pay to that state.

    That said, you should absolutely consult a business account/attorney and ask these questions. Starting a business is something that isn't to be taken lightly. Start it properly.
    Thank you for your help, I appreciate it very much.

  4. #4
    Join Date
    Jul 2005
    Location
    In the Internets
    Posts
    3,622
    Just remember, any income you make is taxed, so save money for it for year-end. Most don't and then realize they own 5-10k come April 15th.

  5. #5
    Join Date
    Nov 2009
    Location
    USA
    Posts
    674

    What do we report a webhosting company as on our taxes in the US?

    Really it would serve you best to talk with an accountant. But in short you will have to report any net income from your hosting business. This is the taxable income.
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  6. #6
    Thank you. Can you tell me what business license I will need? Do I need both my state business license and a DBA?

  7. #7
    Join Date
    Jun 2006
    Posts
    949
    Usually in hosting, you don't need any business license. That usually depends on the city or county. For that matter, so does a DBA. But generally speaking, you will need to file a DBA, run the name in the newspaper for so many weeks, etc.

  8. #8
    Join Date
    Jan 2004
    Posts
    593
    Quote Originally Posted by wswd View Post
    Usually in hosting, you don't need any business license. That usually depends on the city or county. For that matter, so does a DBA. But generally speaking, you will need to file a DBA, run the name in the newspaper for so many weeks, etc.
    Don't give bad advice.

    If you are accepting payments from anyone that has you business name on it then you need to register the business with your state.

  9. #9
    Join Date
    Jun 2006
    Posts
    949
    Quote Originally Posted by speckl View Post
    Don't give bad advice.

    If you are accepting payments from anyone that has you business name on it then you need to register the business with your state.
    You, Sir, have absolutely no clue what you're talking about. Registering a business with the state and getting a business license are 2 very different things.

    You almost always have to register with the state (just to educate you further, there are states where you DO NOT have to register), but you absolutely do not need a business license. Business licenses are normally issued by the county/city, and are very, very rarely required in web hosting. My advice that he likely does not need a business license is very sound.

    How's that for advice?

  10. #10
    Join Date
    Jan 2004
    Posts
    593
    Lol. Ok. That settled it. /rollseyes

  11. #11
    Seriously, the only possible reply to this kind of post is:

    Hire an accountant.

    There is really nothing else to say, as any "advice" would be specific to your city and state laws, etc. An accountant's will be able to answer all your questions quickly, and get you setup so you don't get end up receiving a letter from the IRS with a bill attached to it...

    Anyone who goes into any kind of business without seeking the advice of a tax accountant is crazy and/or stupid.

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