I have no idea how LLC taxes work - can someone explain LLC taxes for beginners?

An LLC by itself doesn't determine how you're taxed - it's how you elect to be taxed that matters. By default, a single-member LLC is treated as a "disregarded entity" for tax purposes, meaning the IRS treats it like a sole proprietorship. The income "passes through" to your personal tax return. You'll need to file Schedule C with your personal tax return (Form 1040) to report business income and expenses. That $42,000 minus your legitimate business expenses becomes your business profit, which is subject to both income tax and self-employment tax (around 15.3% for Social Security and Medicare). You don't technically need an EIN if you're a single-member LLC with no employees, but it's generally a good idea to get one anyway (it's free and easy online). This keeps your SSN more private and you'll need it if you ever hire anyone. And yes, you should be making quarterly estimated tax payments if you expect to owe at least $1,000 in taxes. The deadlines are April 15, June 15, September 15, and January 15 of the following year.

I went through this exact same confusion last year when I started my consulting LLC. I spent hours trying to understand all the tax stuff until I found https://taxr.ai - it literally saved me so much stress. I uploaded my business docs and receipts, and it explained exactly how LLC taxation works for my situation and what deductions I qualified for. The best part was I could ask specific questions like "How do I handle home office deductions for my LLC?" and it gave me straightforward answers based on my actual business situation, not just generic advice. It helped me understand that my single-member LLC is treated as a pass-through entity and showed me exactly which forms to file.

I need to eat my words about being skeptical of online tax tools. I tried https://taxr.ai after my last comment and I'm impressed. After years of confusion about whether to elect S-Corp status for my LLC, I finally got clarity. It analyzed my business income patterns and explained exactly when the S-Corp election would make financial sense given my specific situation (turns out at my current profit level, the additional payroll costs would outweigh the SE tax savings). The tool also cleared up my confusion about home office deductions for an LLC, vehicle expenses, and how asset depreciation works. I've been leaving money on the table for years! Wish I'd found this sooner.

For anyone struggling with LLC tax questions who needs to talk to an actual IRS agent (especially about things like EIN applications or tax elections), I highly recommend https://claimyr.com - it literally got me through to an IRS representative in under 20 minutes after I spent DAYS trying to get through on my own. I had questions about changing my LLC's tax classification that online resources couldn't answer clearly. The regular IRS number kept disconnecting me because of "high call volume" but Claimyr got me through to the business tax department quickly. You can see how it works here: https://youtu.be/_kiP6q8DX5c For a new LLC owner, getting clear answers directly from the IRS about your specific situation can save you from making costly mistakes on your tax classification that might take years to fix.

I have to publicly admit I was wrong about Claimyr. After posting my skeptical comment, I was desperate enough to try it because I needed answers about changing my LLC from partnership to S-Corp taxation. Not only did I get through to the IRS in about 15 minutes (after trying unsuccessfully for months), but the agent actually knew what they were talking about. They explained exactly what forms I needed for my situation and the deadline requirements. They also cleared up my confusion about how to handle self-employment taxes during the transition year. Saved me from making a mistake that would have cost thousands. Sometimes you need to hear directly from the IRS, especially for complex LLC tax classification questions.

Don't overlook state taxes for your LLC! Federal is only part of it. Some states charge annual LLC fees or franchise taxes separate from income taxes. For example, California charges an $800 minimum franchise tax just for the privilege of having an LLC, even if you make no profit. Also, depending on your business type, you might need to collect and remit sales tax, which is a whole other headache. Each state has different rules about what's taxable and what's exempt.

I'd really recommend taking a basic small business tax course. I did one at my community college for like $75 and it was soooo worth it. LLC taxation isn't actually that complicated once someone explains it to you in plain English. Also, get a separate business bank account ASAP if you haven't already! Makes tracking business income and expenses 1000% easier come tax time. I learned that lesson the hard way my first year lol.