Self-Employed How To Open An Online Boutique (Complete Checklist) Read the Article Open Share Drawer Share this:Click to share on Facebook (Opens in new window)Click to share on Twitter (Opens in new window)Click to share on LinkedIn (Opens in new window)Click to share on Pinterest (Opens in new window)Click to print (Opens in new window) Written by Ginita Wall Published Dec 23, 2019 - [Updated Mar 21, 2024] 2 min read It may seem deceptively easy to open and run an online boutique shop these days. All you have to do is set up a website, acquire products, install an online shopping cart, and send out the merchandise as the orders to roll in. No big deal, right? But wait, there’s a hitch: state and local governments are your silent (and sometimes not-so-silent) partners, and they want their cut. If you’re running your own online boutique store, here’s a rundown of how your taxes work. Income Tax How big does a business need to be to owe income taxes? All businesses, whether large or small, owe taxes if their income exceeds their expenses. Those income and expenses are reported on your personal income tax return if you operate the business as a sole proprietorship and you are either self-employed or a single-entity Limited Liability Company (LLC). If the business is a partnership, you’ll need to file a partnership tax return showing how the profits are divided among the partners, and you’ll report your share of the profits on your personal tax return. If you feel like you don’t know these tax rules, don’t worry — you can use QuickBooks Self-Employed to track your business income and expenses year-round, and then you can easily export your information to your TurboTax Self-Employed tax return. Sales Tax Whether you need to collect and pay sales tax depends on the state in which you reside, the state to which the goods are delivered, and the amount and number of your sales. In general, if the state in which you reside and operate the business imposes a sales tax, you’ll need to collect and pay sales tax on your boutique’s sales within that state. Contact your state’s Department of Revenue to find out what paperwork you need to fill out to get a Seller’s permit and remit the taxes due. If you sell to customers living outside your state, you may need to collect sales tax and remit it to those states. Fortunately, most states that collect such taxes have minimum sales thresholds that must be exceeded before they impose a sales tax on sellers outside their state who sell to customers within the state. If your internet boutique is small scale, it is likely that because of those minimum sales thresholds, the sales tax collecting and reporting rules of those states don’t apply to you. When you use QuickBooks Self-Employed it will help you track your sales tax payments and give you the associated tax deductions. Previous Post TurboTax Celebrates #LatinXCulturepreneurs During Hispanic Heritage Month Next Post What Income and Expenses Do Social Media Influencers Need to… Written by Ginita Wall More from Ginita Wall Leave a ReplyCancel reply Browse Related Articles Tax Help How to File a Business Tax Extension: Deadlines, Forms, and Penalties Tax Tips The White Lotus Tax Lessons: Navigating Gift Taxes, Lump Sum Payouts, Hush Money, and the IRS Tax Questions What Day Are Taxes Due? April 15! How to File for a Tax Extension or Pay Taxes Online Tax Questions What Happens If You File Your Taxes Wrong? Late Filing Penalties, Interest, and More Tax Questions What’s Tax Deductible? A Guide to Mortgage Interest, Long-Term Care, Funeral Expenses, Student Loans, and Roth IRA Contributions Tax Questions Is it Better to Get Your Taxes Done or Do Them Yourself? (And Other Tax Questions Answered) Tax Forms What is a 1099-K Form? How to Report Payments on Your Tax Return (2024) Tax Forms What is a 1099 Form? A Guide to Understanding Your Tax Obligations Income Tax by State Wisconsin State Income Tax in 2025: A Guide Income Tax by State West Virginia State Income Tax in 2025: A Guide