• Summit Bookkeeping

Tax and Reporting Duties for Bellingham Businesses

Updated: Aug 18

As a business owner, you have lots of responsibilities. One of the most important ones is paying and reporting taxes. If you aren't diligent about this, you could be faced with penalties and interest fees. In this blog post, we'll go over some of the most common taxes and reports for small businesses on a federal, state, and city level.


Federal Business Taxes

Here are some of the taxes you may need to pay and report to the IRS, not including individual or corporate tax returns.


Estimated Tax Payments

As a self-employed individual, you will most likely need to make quarterly estimated tax payments. These payments account for your federal income tax, Social Security, and Medicare since you aren't having it withheld from a paycheck. Sole proprietors, partners, and S corporation shareholders will need to file an IRS Form 1040-ES while corporations will file an IRS Form 1120-W.


These payments are typically paid in four payments and reported throughout the year with the following deadlines for each quarter:

  • Q1: April 15

  • Q2: June 15

  • Q3: September 15

  • Q4: January 15

If the due date falls on the weekend or a legal holiday, the due date is delayed until the next business day.


Employer's Annual Federal Unemployment (FUTA) Tax

Generally, if you have employees, you will need to pay unemployment taxes, also known as FUTA tax. As an employer, you will pay FUTA tax on the first $7,000 paid to each employee. Depending on how much you owe, you will need to make payments quarterly or annually.


Annual payments are due on January 31 while quarterly payments are due on the last day of the month following the end of the quarter.

  • Q1: April 30

  • Q2: July 31

  • Q3: October 31

  • Q4: January 31

You will report this FUTA annually by filing Form 940.

  • General deadline: January 31

  • If you deposited all quarterly FUTA tax when due: February 1

If the due date falls on the weekend or a legal holiday, the due date is delayed until the next business day.


Employment Taxes

Most employers need to withhold and remit employment taxes, which include federal income tax, Social Security, and Medicare, for each employee. Tax payments should be deposited monthly or semi-weekly. To report taxes, you will either need to file IRS Form 941 quarterly or IRS Form 944 annually. Your filing frequently is dependent on your annual employment tax liability, but most businesses will need to file quarterly. You must have approval from the IRS to file annually.


Form 944 is due on January 31 while Form 941 is generally due by the last day of the month following the end of the quarter.

  • Q1: April 30

  • Q2: July 31

  • Q3: October 31

  • Q4: January 31

If the due date falls on the weekend or a legal holiday, the due date is delayed until the next business day.


Washington State Business Taxes


Combined Excise Tax (DOR)

As a business in Washington, you must report business income, sales tax, and use tax using an Excise Tax Return. When you register your business with the Department of Revenue, you will receive a packet of information that includes your filing frequency (monthly, quarterly, or annually). This is based on your estimated annual business income. Here are the due dates depending on your filing frequency:

  • Monthly: 25th of the following month

  • Quarterly: End of the month following the close of the quarter

  • Q1: April 30

  • Q2: July 31

  • Q3: October 31

  • Q4: January 31

  • Annually: April 15th

If the due date falls on the weekend or a legal holiday, the due date is delayed until the next business day.


State Unemployment Insurance (SUI) (ESD)

In addition to the federal unemployment tax, you must pay unemployment tax on a state level in Washington. Tax will be remitted and reported to the Employment Security Department on a quarterly basis by the last day of the month following the close of a quarter.

  • Q1: April 30

  • Q2: July 31

  • Q3: October 31

  • Q4: January 31

If the due date falls on the weekend or a legal holiday, the due date is delayed until the next business day.


Workers' Compensation

Employers and employees are covered for the financial impact of work-related injuries and disease by workers' compensation. This program is administered by the Washington State Department of Labor & Industries (L&I) and must be paid and reported on the last day of the month following the end of the quarter.

  • Q1: April 30

  • Q2: July 31

  • Q3: October 31

  • Q4: January 31

If the due date falls on the weekend or a legal holiday, the due date is delayed until the next business day.


Paid Family & Medical Leave

In Washington, paid time off for family and medical leave are funded through premiums paid by employers and employees. Unlike other due dates, it must be paid and reported by the following due dates, even if it falls on a weekend or state holiday.

  • Q1: April 30

  • Q2: July 31

  • Q3: October 31

  • Q4: January 31

WA Cares Fund

Update: The WA Cares Fund has been postponed until July 2023.

A new long-term care fund, known as the WA Cares Fund, will be implemented and employers will need to collect and report premiums from employees. Premiums will be collected and reported quarterly in the same system as Paid Family & Medical Leave. The due dates also remain the same:

  • Q1: April 30

  • Q2: July 31

  • Q3: October 31

  • Q4: January 31


City of Bellingham Business Taxes


City of Bellingham B&O Tax

Businesses in the City of Bellingham must pay B&O taxes to fund a variety of city departments such as police, fire, parks, and libraries. Taxes and reports may be due annually, quarterly, or monthly.

  • Monthly: The last day of the following month

  • Quarterly: End of the month following the close of the quarter

  • Q1: April 30

  • Q2: July 31

  • Q3: October 31

  • Q4: January 31

  • Annually: April 15th

If the due date falls on the weekend or a legal holiday, the due date is delayed until the next business day.


Stay on Top of Your Deadlines

Here is a brief overview of the taxes and reports that we mentioned in this post and a link to information about each of them on their respective collecting agency's website:

Remembering deadlines and ensuring your paying the correct amount of tax can be difficult to juggle. Luckily, when you become a bookkeeping client of ours, we can file and report taxes for you, taking one more thing off your plate. Give us a call at (360) 756-5020 to see if Summit Bookkeeping is the right fit for your business.



 

Disclaimer: This post is meant for informational purposes only and should not be taken as legal, business, or tax advice. Please consult with your accountant or bookkeeper for more information based on your specific situation. For more information, please read through the following resources in the table above.