TAXES & LICENSES
State and Local Income Tax
In addition to paying federal income taxes, you may also be subject to paying state and local income taxes on the earnings from your business. Typically, state income taxes are imposed by the state or local government in the jurisdiction you live or are conducting business in. The good news is that the IRS allows you deduct these taxes when you prepare your federal tax return, which may be applicable for both business owners and employees, the only difference being where you claim the deduction.