Closing a business can be overwhelming. But it’s important not to let tax duties fall through the cracks. File a federal income tax return for your business’s final year and, if you have employees, make final federal tax deposits and report employment taxes. If you engaged independent contractors and, in your final year, paid anyone $600 or more ($2,000 for 2026, indexed for inflation after that), report the payments.
Also, cancel your employer identification number (EIN) by sending the IRS a letter with the EIN, business name and address, and reason for closing your account. Finally, retain records of your business’s tax returns, employment tax payments and any property it owned. Contact the office for help.
408-252-1800
Photo by Unsplash from Freerange Stock.