Collect W2 and side business

[roger81425]

Hello!

I am a full-time employee (receive W2) located in South Carolina and just started my E-commerce business two months ago as a Sole Proprietorship. The revenue is about $8,500 so far and is expected to grow. I am collecting all the expenses (receipts or bank statements), profit, and net income by myself for the record.

When the tax season comes, I am thinking of filing my regular 1040 form with Schedule C. I will claim the home office and everything that comes with this E-commerce business under Schedule C and then file my full-time job on the 1040 form as usual.

Questions:

1. Based on the above information, do I miss anything? 

2. Do I have to file the e-commerce business tax quarterly? What's the benefit of filing it quarterly?

2. Am I considered the self-employment? Should I file the Schedule SE?

3.  What is a Quarterly sales tax and Quarterly Self-employment taxes? Do I need it?

Thanks a lot for your time! I appreciate any suggestions and information.

[VincentL · Accepted solution]

1. Based on the above information, do I miss anything? 

No. You stated how the process for filing your taxes correctly.

2. Do I have to file the e-commerce business tax quarterly? What's the benefit of filing it quarterly?

Yes.  If your payments are not timely, the IRS will assess late payment penalties.

https://www.irs.gov/businesses/small-businesses-self-employed/self-employed-individuals-tax-center

2. Am I considered the self-employment? Should I file the Schedule SE?

Yes. Even though you have W-2 employment, you also have taxable self employed business activity.

Yes. See above link to the IRS website.

3.  What is a Quarterly sales tax and Quarterly Self-employment taxes? Do I need it?

Quarterly sales tax are remitted to your local taxing authority if you are selling items or products where sale taxes are required and charged.

Quarterly Self-employment tax is a tax consisting of Social Security and Medicare taxes primarily for individuals who work for themselves. It is similar to the Social Security and Medicare taxes withheld from the pay of most wage earners.

[roger81425]

Thanks Vicent!

Since I am considered self-employed and need to file taxes quarterly, I'd like to ask a few follow-up questions. 

Questions:

1. What are considered expenses? I am thinking of "Cost of Goods", "Platform Charge", "Freight Charge", "Office supplies", "Software Subscription Fee", "Part of Utility Bill", and "Internet". Are any of them not eligible for expenses?

1-1. Am I allowed to claim part of the utility bill and internet as expenses? I will claim the home office and use one of the bedrooms exclusively for this business.

2. If my business net income (revenue - expenses) is negative, do I still need to file quarterly sales tax and self-employment tax?