Q&A: Do you need to pay taxes for a small business if you do no business?

Posted on December 17, 2011 by

Question by : Do you need to pay taxes for a small business if you do no business?
My friend and I are college students who want to start a small business. We don’t plan on actually doing any business until 2010 but it would be nice to have it all set up by then. If we set it up all now and don’t do any business until 2010 do we still need to file for 2009? I know the filing would be rather easy because we didn’t do business but it’s still a pain in the ass for no business being done and all..

Best answer:

Answer by The CPA Guy
If you form the organization in 2009 but don’t do any business in the year, you don’t need to pay taxes but you will still have to file a return.

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2 Responses to Q&A: Do you need to pay taxes for a small business if you do no business?

  1. tro says:
    December 17, 2011 at 9:31 pm

    you don’t file anything that is not functioning
    if and when you get this going, in 2010, maintaining your records you will be ready to file Sch’s C and SE next year

  2. the tax lady says:
    December 17, 2011 at 10:06 pm

    Just don’t get creative and open an LLC because you heard it was cool to do.

    Many states have a franchise tax for just having the LLC whether or not there is income.

    By the way, if you open the business together, it’s NOT schedule C–you’d be a partnership and have to do a 1065.
    The poster who told you to file schedule Cs does not know much tax law.