Minneapolis business owners must keep track of their tax obligations, especially in light of the Franchise Tax deadline that comes up every year. One such requirement is the yearly Franchise Tax, which is a vital requirement for maintaining your business’s legal standing in the state. Even though handling tax issues may seem stressful, you can be sure that with the correct help, the process can be simple. Contact QuickBooks services in Minneapolis to learn how to file business franchise tax in your state.
Ways to file your business franchise tax in Minneapolis
You must identify the exact parties responsible for paying the Minneapolis Franchise Tax before commencing the filing procedure. To put it simply, this tax is charged on all Minneapolis-incorporated businesses, irrespective of their size or level of profitability. Therefore, in order to maintain your company’s legal status if it is based in Minneapolis, you will need to make sure that this tax requirement is fulfilled.
Now that the tax’s scope has been determined, let’s examine the procedures involved in submitting the Minneapolis Franchise Tax. These steps are going to be your road map to successful tax compliance, no matter whether you choose to work on this assignment on your own or with professional assistance.
Step 1
You can use the designated website to obtain your Business Entity File Number if you are not sure of it. Just be cautious to find the right number for your business to prevent accidentally paying someone else’s taxes!
Step 2
A sizable “amount due” may be displayed on the screen when you are ready to submit your annual report. Stay calm! Startup founders can get extremely scared by this, although it occurs regularly. You can select the method that provides a lesser tax amount from the following two options for computing your tax:
- Authorized shares method: Regardless of how many shares are actually issued, your tax is calculated using the total amount of shares your company is allowed to issue. This method may result in higher tax obligations for businessmen.
- Assumed par value approach: This method takes into account both your gross assets and issued shares. Usually, it results in a tax that is lower, not less than $400. Small and starting businesses generally prefer this strategy.
Step 3
Click “Recalculate Tax” after inputting all required stock data in the table. You are required to supply:
- The total number of shares—rather than just the approved amount—that your company has issued. This is typically the total number of outstanding shares.
- Enter all the assets from your previous year’s balance sheet for “gross assets,” which is typically your bank value as of December 31st.
Step 4
Enter the information for one of your company’s corporate officials (typically the CEO), your business location (not the location of your registered agent), and the contact information and names of all of the members of your board of directors as of this moment. Verify your incorporation documents even if you do not think you have a board.
After your examination and confirmation that all the information is true, you can use the website to pay the tax. The tax burden for early-stage companies is usually $400 for every $1 million in net assets, plus a $50 filing fee.
Step 5
Check the accuracy and completeness of all the information you provided before submitting your file. Verify that there are no mistakes or inconsistencies that could affect the reliability of your submission by carefully going over each field twice. Once you are satisfied that your file is true, use the web gateway to make your payment.
Consider seeking expert help
While many business owners choose to collaborate with a professional tax preparer, others might want to manage their Franchise Tax filing on their own. If you have a tax preparer already, find out if they can help you submit the Franchise Tax as part of their services.
