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Old 04-01-2014, 05:26 PM
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Join Date: Apr 2014
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estimated tax LLc single member 1st year business

I started a new part-time side business In California on January 8th, 2014. This is my first year in business. This business is a home based sole member LLC selling retail products on the internet. I have also been employed for many years. I have a regular salary (gross income less then 150,000/year) and income taxes withholding on this salary. I filed my 2013 tax return on January 22, 2014 based solely on the salary from my regular employer. Federal tax refund was $17 and Ca state tax refund was $385.
The initial owner contribution to my LLC business was $12,830 in January 2014. I had only had expenses so far. I placed an order for the merchandise that I will be selling on the internet. I have not been selling anything so far. The merchandise that I bought for reselling on the internet will be delivered around may 15th, 2014. I will start selling and making a profit around June 2014. I expect to sell for about $4000 of merchandise per month starting in June 2014.
I asked around and I get different answers regarding 2014 estimated tax payments :
1) No, you do not need to make any business estimated tax payment the first business year (2014) because business did not exist in 2013.
2) Yes, you need to make estimated tax payment the first quarter of 2014 even if you do not make any profit at this time by estimating/guessing what your profit will be during the second half of 2014, and making equal payments starting with the first quarter of 2014.
3) No, you do not need to make any estimated payment at this time (first quarter 2014) because you have not made any profit as of april 2014.
4) no, you do not need to make any estimated payment in 2014 because salary withholding for 2014 will equal the amount of tax you owed in 2013 ("100 percent of previous year's taxes").

I have to say that I am a little bit confused...

Question: in my situation, do I have to make business based estimated quarterly income/self-employment taxes payments (1040 ES, 540 ES) ? If so, starting when ?

Thank you



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