Do you know that 30% of small businesses admit to filing taxes late because they did not know which forms to use? The IRS files over 200 million tax returns each year, a lot of them are postponed due to missing documents.
In case filing tax returns have baffled you, you are not the only one. From 1099s to W-2s to Schedule Cs and much more, you may feel overwhelmed. But the great news is you needn't file every tax form available, just the ones which pertain to your business.
In this blog, we break down the 10 most crucial tax forms for small businesses to help you file confidently and stay away from expensive mistakes.
Top 10 Tax Forms which Small Business Owners Need to File
Below are the 10 tax forms which every small business owners needs to file:
1. Form 1040 (U.S. Individual Income Tax Return)
Who needs it? Every business owner (sole owners, freelancers, single member LLCs).
Why it matters: This is your main tax return which reports all your personal and business earnings.
Key details:
- Attach Schedule C (for sole props) or other business forms (in case applicable).
- Due April 15 (or October 15 with extension).
2. Schedule C (Profit or Loss from Business)
Who needs it? Sole owners / freelancers / single member LLCs.
Why it matters: This form reports your business earnings, expenses, and net profit - how much tax do you owe.
Key details:
- List deductions (office supplies, mileage, etc.).
- Net profit goes to Form 1040.
3. Form 1065 (U.S. Return of Partnership Income)
Who needs it? Partnerships & multi-member LLCs.
Why it matters: Reports business income, deductions, and profits/losses (which are split amongst partners).
Key details:
- Due March 15 (or September 15 with extension.)
- Each partner gets a Schedule K-1 for reporting their share on their personal return.
4. Form 1120 (U.S. Corporation Income Tax Return)
Who needs it? C corporation.
why it matters: C corps file separate from owners (unlike LLCs/sole props).
Key details:
- Due April 15 (October 15 with extension).
- Corporate tax rate is 21% (flat rate).
5. Form 1120-S (Income Tax Return for an S Corporation)
Who needs it? S corporations.
Why it matters: S corps pay no corporate tax - profits/losses pass to owners' personal returns.
Key details:
- Due March 15 (or September 15 with extension.)
- Owners report income through Schedule K-1.
6. Form 941 (Employer's Quarterly Federal Tax Return)
Who needs it? Businesses with workers.
Why it matters: Reports withheld payroll tax (Social Security, Medicare, federal income tax).
Key details:
- Filled quarterly (April 30, October 31, July 31, January 31).
- Also file Form 940 for unemployment taxes.
7. Form 1099-NEC (Nonemployee Compensation)
Who needs it? Businesses paying contractors USD 600 + a year.
Why it matters: The IRS tracks contractor payments to prevent underreported income.
Key details:
- Due January 31 (to IRS and contractors).
- Applies to freelancers, gig workers and consultants.
- Late filing penalty: 50$-280$ for every form.
8. Form W-2 (Wage and Tax Statement)
Who needs it? Businesses with workers.
Why it matters: Reports wages, tips and taxes withheld for each worker.
Key details:
- Due January 31 (to workers and IRS).
- File Form W-3 (summary of all W-2s) through the Social Security Administration.
9. Form 1040 ES (Estimated Tax for Individuals)
Who needs it? Self-employed folks & business owners who owe USD 1,000 + in taxes.
Why it matters: Avoids underpayment penalties when you pay taxes quarterly.
Key details:
- Due April 15, September 15, June 15, January 15.
- Make payments according to last year's tax bill or current-year estimates.
10. Form 4562 (Amortization and Depreciation)
Who needs it? Firms which claim depreciation on assets (e.g., equipment, automobiles).
Why it matters: Lowers taxable earnings by distributing asset expenses over time.
Key details:
- Covers Section 179 deductions (up to $1.16 M by 2023).
- For items such as laptop computers, machinery or office furniture.
Also Read | Top 10 Tax Deductions Most Small Business Owners Miss
Conclusion
Tax season shouldn't be stressful as long as you know which forms to file. About 40% of small businesses make tax errors frequently because they do not understand which forms to use. But now that you know the top ten essential tax forms, you can remain compliant, steer clear of penalties and save money. Regardless if you're a sole proprietor filing a Schedule C or a corporation filing Form 1120, each form is important to maintain your company's finances neat and correct. In case you have queries about which forms you require, consult a tax expert like The Fino Partners. The right help can make tax season easy for your business
