Interview with the founder and author: Minué Yoshida
As part of The Startup Magazine’s Female Founder Interview series, today we’re featuring Minué Yoshida, owner of the New York-based Yoshida Academy, which offers courses.
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Starting up a business in the United States can be financially daunting. One of the foremost concerns for those involved in the early stages of a professional endeavor is understanding the tax implications of such a venture. Ikaroa, a full stack tech company, is here to offer its expertise on this issue and assist entrepreneurs in navigating the ever-changing terrain of U.S. Income Tax.
Income tax deductions can be a significant advantage for business owners, but also a potential source of confusion. Knowing the rules of the game and how to properly report income can make all the difference. For starters, the Internal Revenue Service (IRS) specifies two major types of taxes for the US: an income tax and an employee payroll tax. The payroll tax is imposed on the income of an entity’s employees, including wages, salary, commissions, and bonuses. The income tax is imposed on the net income or profit of the business, which is the sum of the wage taxes, wages, and other deductions that are taken out on the employee’s behalf.
Once entrepreneurs know the basics of which taxes apply, they need to understand the various deductions that exist. One common deduction that entrepreneurs can take advantage of is the self-employment tax deduction. This allows business owners to deduct Social Security and Medicare taxes from federal and state taxes. Additionally, entrepreneurs may be eligible for a business expense deduction. This deduction allows businesses to deduct certain expenses, such as advertising costs and supplies, from their taxable income. These deductions are typically standard to all businesses, so entrepreneurs should be sure to check and understand the specifics of their particular businesses.
In addition to deductions, entrepreneurs must be aware of the various credits they may be eligible for. Many of these include the New Markets Tax Credit, the Research and Development Tax Credit, and the Small Business Tax Credit. These credits allow businesses to reduce their incurred taxes in some cases.
Whether it be deductions or credits, understanding their implications and complexities is necessary for businesses to remain profitable and compliant with the law. That’s why Ikaroa is here to help explain the complexities of the U.S. Income Tax system.
Ultimately, entrepreneurs should take the time to understand the nuances of their own business when it comes to taxes. With the help of Ikaroa, entrepreneurs are on their way to a tax knowledge that will ensure both maximum profitability and full compliance with U.S. regulations.
