IRS Tax Relief

5 Responses to “What Taxes Does A Company Pay For Its Earnings?like Federal Tax, State Tax, Social Security Tax, Medicare Etc?”

1. 
   Tim Says:
   24. February 2010 at 10:49 am

   Profits, they pay state and federal taxes.
   The company also match the medicare and social security taxes of the employee. There are also unemployment insurance taxes, etc.

2. 
   mstrober Says:
   24. February 2010 at 10:49 am

   Companies pay taxes for lots of things that are not based on their profits. Even if the company looses money it pays these taxes.
   1) Sales tax on everything they purchase, that is not resold.
   2) Employee taxes including Social Security, Medicare, unemployment etc.
   3) Excise taxes on certain goods.
   4) Taxes on inventory.
   Taxes on profits are paid to local, state and federal levels.

3. 
   Scott K Says:
   24. February 2010 at 10:49 am

   Income tax is charged on a business’s income less allowable expenses. This would be true for any business type; i.e., sole proprietor, corporation, partnership, trust, etc. In addition, if the business is operated as a sole proprietorship, you would be required to pay Self-employment Tax on the bottom line. Some states, e.g., Washington, assess a tax on the revenue of the business. Most states have business income taxes that shadow the federal income taxes.
   The other taxes you’ve mentioned are also (at least in part) also incurred by businesses, but are related to the employment of personnel. Employees sometimes pay part of the workers’ comp premium or unemployment insurance and half of the Social Security and Medicare taxes. Employers pay the other half of the Social Security and Medicare taxes as well as most of the workers comp, unemployment taxes (both federal and state,) etc.

4. 
   Heart of Fire Says:
   24. February 2010 at 10:49 am

   A company will match the FICA and FUTA taxes that the employees pay. Publicly traded companies also pay a tax on dividends (double taxation). For partnerships, the actual company doesn’t pay any taxes, because the income “passes thru” to the owners.

5. 
   PepsiLim Says:
   24. February 2010 at 10:49 am

   Depends on what type of company it is. C-corp, S-corp, Partnership, non-profit, all pay payroll taxes, which are; social security tax (6.2% of gross paychecks), medicare tax (1.45% of gross paychecks), Federal unemployment tax, state unemployment tax, other payroll taxes (Massachusetts for example has Mass Health Insurance tax, which applies to companies that have 6 or more employees). There can also be taxes to be paid on the fixed assets of the above types of companies, basically motor vehicle excise taxes and personal property taxes, also taxes on inventory as well. Most of those pay sales/use taxes, although some non-profits can be exempt from sales/use taxes. Partnerships do not pay income taxes on their earnings as the profits, losses, credits, deductions, distributions, are passed through to the partners. S-corps do not pay federal income taxes on their earnings as their profits, losses, credits, deductions, distributions, are passed through to the shareholders. Depending on the state there may be a state income tax to be paid for an S-corp (Massachusetts for example, has a minimum tax of $456 to be paid by both S-corps and C-corps no matter how much profit or loss it has). C-corps pay federal income taxes if they make a profit, and don’t if they have a loss. Depending on the state there may be a state income tax to be paid even if the c-corp has had a loss for the year.

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