Business CPA

E-commerce Taxes 101: What You REALLY Owe (And How to Pay Less)

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Running an Amazon, Shopify, or Etsy store is exciting. You’re building something of your own, making sales while you sleep, and scaling up without the overhead of a brick-and-mortar shop. But then tax season hits, and suddenly, it’s not so fun anymore.

“Wait… Do I owe sales tax in every state? What the heck is self-employment tax? And why does it feel like I’m working for the IRS instead of myself?”

We get it. Taxes are confusing, frustrating, and (let’s be honest) kind of the worst. But avoiding them or assuming you’ll “figure it out later” is a surefire way to end up with a massive tax bill or penalties down the road.

At Insogna CPA, a top Austin, Texas CPA firm, we help e-commerce entrepreneurs legally minimize their tax burden, stay compliant, and keep more of what they earn.

Let’s break down what you actually owe and how to make sure you’re not overpaying.

The 3 Taxes Every E-commerce Seller Needs to Know About

Most online sellers think taxes = income tax, but that’s only part of the picture. Here’s the full breakdown:

  • Sales Tax – Collected from customers, remitted to the state.
  • Income Tax – Paid on your profits.
  • Self-Employment Tax – Covers Social Security & Medicare.

Each tax applies differently, depending on where you sell, what you sell, and how your business is structured.

Let’s unpack them one by one.

1. Sales Tax: When and Where Do You Have to Collect It?

Sales tax is not your money. You’re just collecting it for the state and handing it over like a responsible business owner.

Do You Need to Collect Sales Tax?
 ✔ YES, if you have nexus in a state (more on that below).
 ✔ YES, if your revenue exceeds a state’s economic threshold (usually $100K+ in annual sales).
 ✔ YES, if your products are taxable in that state (not all are).

Common Mistake: “I Registered My LLC in Wyoming, So I Only Pay Sales Tax There”
Reality Check:
Your LLC’s location means nothing for sales tax. If your Amazon FBA inventory is sitting in Texas or California, you have nexus in those states and must collect and remit sales tax there.

What You Can Do:

  • Use TaxJar or Avalara to automate sales tax tracking.
  • Work with an Austin tax accountant (like us!) to register in the right states and avoid penalties.

Good News: If you sell through Amazon, Shopify, or Etsy, these platforms collect and remit sales tax for you in some states but not all.

Income Tax: What You Actually Owe on Your Profits

Income tax is what you pay to the IRS and your state on your net business profits.

How Much Will You Pay?

  • Federal Income Tax: Ranges from 10% to 37%, depending on your total income.
  • State Income Tax:
    • If you’re in Texas or Florida, you’re in luck—no state income tax.
    • If you’re in California or New York, expect up to 13% on top of federal taxes.
  • Business Structure Matters:
    • LLCs pay income tax on personal returns.
    • C-Corps pay corporate tax first, then shareholders pay taxes on dividends.

Common Myth: “I Only Pay Taxes When I Withdraw the Money”
Reality Check:
Nope. The IRS taxes your profits, not your withdrawals. Even if you leave every dollar in your business account, you still owe income tax on your earnings.

What You Can Do:

  • Maximize deductions (see below).
  • Consider an S-Corp election if you’re making $50K+ in profit—it can save you thousands.
  • Work with a small business CPA in Austin, Texas to create a proactive tax plan.

Self-Employment Tax: The One That Sneaks Up on New Sellers

If you’re self-employed, you don’t have an employer covering Social Security and Medicare taxes for you. You’re on the hook for both sides.

How Much Is Self-Employment Tax?
15.3% of your net earnings
(ouch).

  • 4% for Social Security
  • 9% for Medicare

Who Pays It?

  • Sole Proprietors & Single-Member LLCs – Pay self-employment tax on all profits.
  • Multi-Member LLCs & Partnerships – Each partner pays self-employment tax on their share of profits.
  • S-Corps – Only pay self-employment tax on your salary, not your entire profit (this is why so many business owners switch to S-Corp status).

Common Myth: “I Can Avoid Self-Employment Tax by Paying Myself in Dividends”
Reality Check:
The IRS requires reasonable compensation if you take an S-Corp election. If you’re running an e-commerce business full-time, paying yourself a $10K salary with $90K in dividends is a huge audit risk.

What You Can Do:

  • Consider an S-Corp election to reduce self-employment tax legally.
  • Use payroll software like Gusto to handle taxes automatically.
  • Talk to a CPA in Austin, Texas to make sure your salary-to-dividend ratio is audit-proof.

Don’t Let Taxes Stress You Out: Plan Ahead & Pay Less

Most e-commerce sellers overpay in taxes simply because they don’t know how to plan ahead. Now you do.

 ✔ Sales Tax – Based on nexus & sales volume, collected from customers.
 ✔ Income Tax – Paid on business profits, even if you don’t withdraw the money.
 ✔ Self-Employment Tax – Covers Social Security & Medicare (but can be reduced with an S-Corp).

At Insogna CPA, a top Austin accounting firm, we help e-commerce sellers:
 ✔ Reduce tax liability with smart deductions & strategies.
 ✔ Stay compliant with sales tax laws to avoid penalties.
 ✔ Optimize business structures (LLC vs. S-Corp) for maximum savings.

Want to stop overpaying? Let’s build a proactive tax plan together—schedule a call with Insogna CPA today!

Trying to Lower Your Amazon Business Taxes? Don’t Fall for This Costly Mistake

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If you sell on Amazon, you’re always looking for ways to cut costs and boost profits and that includes taxes. Maybe you’ve heard that registering your LLC in Wyoming, Delaware, or Nevada can help you skip state fees and reduce your tax bill.

Spoiler alert: It won’t.

Too many Amazon sellers make this move thinking they’re hacking the system only to end up paying just as much (or more) in taxes thanks to something called business nexus. That’s right: Your LLC’s location doesn’t control where you owe taxes, where you actually do business does.

At Insogna CPA, a leading Austin, Texas CPA firm, we work with Amazon sellers to legally reduce their tax burden without gimmicks that backfire. Let’s break down why registering in a tax-friendly state won’t save you money and what actually will.

The Costly Mistake: Thinking Your LLC’s Location Controls Your Tax Bill

A lot of e-commerce sellers assume that where they register their LLC is where they’ll pay taxes. That’s a big misconception.

What Actually Determines Your Tax Obligation?

  • Where you physically run your business (where you live & work).
  • Where your inventory is stored (FBA fulfillment centers count!).
  • Where you have employees, contractors, or warehouses.

If you live in a high-tax state like California, New York, or Texas and register your LLC in Wyoming, you still owe taxes in the state where you actually operate.

Why Business Nexus Matters (And Why Your LLC’s Location Won’t Save You)

Business nexus is how states determine if your business has a taxable presence—meaning, if you owe them money.

Ways Amazon Sellers Create Nexus Without Realizing It:
 ✔ Amazon FBA Inventory – If your products are stored in a Texas or California fulfillment center, congrats—you have nexus in those states, and you owe taxes there.
 ✔ Sales Volume – Many states have economic nexus laws that trigger tax obligations when you sell over a certain amount (often $100K+ annually).
 ✔ Employees or Contractors – If you have a VA, warehouse worker, or customer service rep in another state, that’s nexus.

Why This Is a Problem
 Even if your LLC is registered in Wyoming, the IRS and state tax authorities will still tax you based on where you actually do business. If you ignore nexus rules, you could face penalties, back taxes, and major headaches later on.

How to Actually Lower Your Amazon Business Taxes (Legally!)

Instead of trying to trick the system, focus on real tax-saving strategies that actually work.

1. Max Out Your Business Deductions

The IRS lets you write off legitimate business expenses so why not take full advantage?

Amazon Seller Tax-Deductible Expenses:

  • Amazon seller fees, storage fees, and advertising costs
  • Software & tools (Helium 10, Jungle Scout, TaxJar)
  • Home office expenses & internet costs
  • Business-related travel, meals, and education
  • Contractor payments (VAs, designers, copywriters, etc.)

Pro Tip: Most business owners miss deductions that could save them thousands. Work with an Austin tax accountant (like us!) to make sure you’re not overpaying.

2. Consider an S-Corp Election to Reduce Self-Employment Tax

If your Amazon business profits exceed $50,000 per year, switching from an LLC to an S-Corp election could save you thousands in self-employment taxes.

How It Works:

  • Instead of paying 3% self-employment tax on all profits, you pay yourself a reasonable salary and take the rest as distributions (which aren’t subject to self-employment tax!).
  • You’ll need to set up payroll and file extra tax forms, but the tax savings can be well worth it.

Pro Tip: Not sure if an S-Corp is right for you? A tax advisor in Austin can help you run the numbers and make the best choice.

3. Get Sales Tax Compliance Right (Because Amazon Won’t Do It for You)

Collecting and remitting sales tax properly is crucial but many sellers assume Amazon takes care of everything.

Reality Check:
 ✔ Amazon only collects & remits sales tax in some states, not all.
 ✔ You may still need to register for a sales tax permit in states where you have nexus.
 ✔ Failing to file sales tax returns could lead to penalties, audits, or even Amazon account suspension.

Pro Tip: Use tax software like TaxJar or Avalara, or consult a small business CPA in Austin Texas (like us!) to ensure compliance.

4. Choose the Right State for Your LLC (If You Need One at All)

For most Amazon sellers, registering your LLC in your home state is the easiest and most compliant option.

Best Practices for LLC Formation:
 ✔ If you live and operate in a state: register your LLC there.
 ✔ If you operate in multiple states, consider Texas or Florida (both have no state income tax and business-friendly laws).
 ✔ If you need an investor-friendly setup, a Delaware C-Corp may be the best option.

Pro Tip: Every business is unique. Get personalized guidance from an Austin CPA firm to ensure you’re making the right choice.

Final Thoughts: Stop Falling for Tax Myths And Use Strategies That Actually Work

Registering your LLC in Wyoming won’t magically erase your tax bill, but smart tax planning can help you keep more of your hard-earned profits. Instead of risky workarounds, focus on legal, effective strategies like:

Maximizing deductions to reduce taxable income
Considering an S-Corp election if profits exceed $50K
 ✔ Getting sales tax compliance right
 
Choosing the right LLC state based on where you actually do business

At Insogna CPA, a leading Austin accounting firm specializing in e-commerce tax strategy, we help Amazon sellers:
 ✔ Lower their tax liability legally
 ✔ Stay compliant with state and federal tax laws
 ✔ Optimize tax elections for maximum savings

Want to stop overpaying in taxes? Schedule a tax strategy session with Insogna CPA today and let’s optimize your Amazon business taxes!

How to Structure Your LLC for Maximum Tax Efficiency

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Choosing the right structure for your LLC can significantly impact your taxes, liability protection, and long-term profitability. Yet, many business owners unknowingly overpay taxes or miss deductions because their business structure isn’t optimized.

At Insogna CPA, a leading Austin, Texas CPA firm, we specialize in helping small businesses select the right structure for optimal tax efficiency. This guide will explain the most common LLC structures, how they affect taxes, and how you can maximize savings with the right setup.

Why LLC Structure Matters for Tax Efficiency

A Limited Liability Company (LLC) provides personal asset protection while offering flexibility in how you’re taxed. However, the way you structure your LLC directly affects:

  • Self-Employment Taxes
  • Income Tax Filing Requirements
  • Payroll Compliance
  • Deductions and Tax Savings Opportunities

Whether you’re a freelancer, contractor, or growing business, choosing the right LLC tax classification can save you thousands each year.

Common LLC Structures and How They Impact Taxes

1. Single-Member LLC (Default Classification)

A Single-Member LLC (SMLLC) is the default structure for a sole business owner. It’s treated as a disregarded entity, meaning your business income flows directly to your personal tax return.

Key Tax Implications:

  • Income is reported on Schedule C of your personal return.
  • Profits are subject to self-employment tax (15.3%).
  • All income is taxed as ordinary income.

Best For: Freelancers, consultants, and small businesses with lower earnings.

When to Reconsider: If you’re earning more than $50,000 annually, consider switching to an S-Corp for tax savings.

2. Multi-Member LLC (Taxed as a Partnership)

A Multi-Member LLC (MMLLC) is the default structure for LLCs with two or more owners.

Key Tax Implications:

  • Income is reported on a Partnership Return (Form 1065).
  • Each partner receives a K-1 reflecting their share of income and expenses.
  • Profits are subject to self-employment taxes for each member.

Best For: Partnerships, real estate investors, and service firms with multiple owners.

Tax Planning Tip: Working with a small business CPA in Austin can ensure profit-sharing aligns with your business goals while minimizing tax liabilities.

3. LLC with S-Corp Election (for Tax Savings)

An S-Corp election allows an LLC to be taxed as an S-Corporation, reducing self-employment tax exposure.

Key Tax Implications:

  • Owners pay themselves a reasonable salary (subject to payroll taxes).
  • Remaining profits can be taken as distributions, avoiding self-employment tax.
  • The LLC files an S-Corp tax return (Form 1120-S) and issues K-1s to owners.

Example:
A business earning $120,000 as a sole proprietor pays self-employment taxes on the full amount. By electing S-Corp status and paying a $60,000 salary, only the salary is subject to payroll taxes, potentially saving over $9,000 annually.

Best For: Businesses with consistent profits exceeding $50,000 annually.

Pro Tip: Insogna CPA, a leading CPA firm in Austin, Texas, helps clients calculate a defensible salary and manage payroll compliance for maximum savings.

4. LLC Taxed as a C-Corp (for Larger Businesses)

An LLC taxed as a C-Corporation separates business income from personal income. The company itself pays taxes on profits, while owners are taxed separately on dividends received.

Key Tax Implications:

  • Corporate tax rate is a flat 21%.
  • Potential for double taxation if dividends are issued to shareholders.
  • Owners can benefit from expanded fringe benefits and reinvestment strategies.

Best For: Larger businesses planning to reinvest profits rather than distribute them as dividends.

When Should You Change Your LLC Structure?

Your current LLC structure may not be serving you if:

  • You’ve crossed $50,000 in annual profit.
  • Self-employment taxes are reducing your income significantly.
  • You’re expanding and hiring employees.
  • You want to reinvest profits or attract investors.

By working with a CPA in Round Rock, TX or Austin, you can identify whether an S-Corp election or partnership structure might be more tax-efficient for your goals.

How Insogna CPA Helps You Optimize Your LLC for Tax Efficiency

At Insogna CPA, we take the guesswork out of business structuring with tailored strategies that work for your unique situation. Our Austin accounting services include:

LLC Structure Evaluation: We review your earnings and tax situation to recommend the most beneficial structure.
S-Corp Election Management: We help you file Form 2553 and establish payroll compliance.
Expense Optimization: Maximize deductions, including home office, travel, and professional services.
Ongoing Compliance: We ensure your business stays compliant with Texas state tax laws and payroll requirements.

Whether you’re a startup or a growing company, our accounting firm in Austin offers proactive strategies that go beyond tax filing.

Case Study: How An Austin-Based Consultant Can Save $12,000 in Taxes With Insogna CPA’s Help

The Problem:
 A freelance consultant in South Austin operating as a single-member LLC was paying self-employment taxes on 100% of their income, totaling nearly $18,000 annually.

The Solution:
After a tax efficiency review, Insogna CPA recommended transitioning to an S-Corp election and reducing taxable wages with a compliant reasonable salary.

The Outcome:
 ✅ They’ll be able to save $12,000 in self-employment taxes.
 ✅ They’ll be able to gain better cash flow for business reinvestment.
 ✅ Have a fully compliant payroll and quarterly tax filings.

Take Control of Your Business Taxes Today

Is your LLC structured for maximum tax savings? If you’re unsure, it’s time to take action. Whether you’re operating as a sole proprietor, partnership, or LLC, expert guidance can help you save thousands in taxes while keeping your business compliant.

Contact Insogna CPA today for a personalized tax strategy session. Let our expert team, known for providing the best CPA services in Austin, help you optimize your business structure for lasting success.

Setting Up an E-2 Visa Business? Here’s How to Structure It for Maximum Tax Savings

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So, you’re launching a business in the U.S. under an E-2 visa? Congrats! 🎉 You’re stepping into an exciting new chapter of entrepreneurship. But before you start celebrating, let’s talk about one of the biggest financial decisions you’ll make: how to structure your business for tax efficiency.

If you don’t set things up the right way from the start, you could end up paying way more in taxes than necessary (and trust us, the IRS isn’t going to send you a thank-you note).

At Insogna CPA, a trusted Austin, Texas CPA firm, we help international entrepreneurs like you navigate U.S. tax laws, business structures, and financial setup so you can focus on growth without worrying about compliance nightmares. Let’s break it all down in plain English so you can make the smartest move for your business.

What You Need to Know About the E-2 Visa

Before we dive into tax strategy, let’s quickly cover the E-2 visa basics:

 ✔ Investment Requirement: No set minimum, but most successful applications invest at least $100,000+.
 ✔ You Must Run the Business – This is not a passive investor visa; you need to be actively involved.
 ✔ Job Creation Matters – While you don’t have a set quota, your business should contribute to the U.S. economy and create jobs.

Sounds simple, right? Well, here’s where things can get tricky: choosing the wrong business structure could cost you thousands in extra taxes and compliance headaches.

LLC vs. C-Corp: Which One Is Right for Your E-2 Business?

Most E-2 business owners choose between two main structures: LLC (Limited Liability Company) or C-Corp (C-Corporation). Each has major tax implications, so picking the wrong one is a big deal.

Option 1: LLC – Simple, Flexible & Tax-Friendly

LLCs are hugely popular for small businesses and startups because they’re easy to set up, provide liability protection, and keep taxes relatively simple.

How LLCs Are Taxed:

  • If you’re a single-member LLC, your income passes through to your personal tax return (Schedule C).
  • A multi-member LLC is taxed as a partnership (Form 1065), and each member gets a K-1 for their share of profits.
  • LLCs can elect to be taxed as an S-Corp or C-Corp if needed.

Why an LLC Might Be a Good Fit for You:
 ✔ No Double Taxation – Profits pass through to you, avoiding corporate taxes.
 ✔ Less Paperwork – Fewer compliance requirements than corporations.
 ✔ More Flexibility – Profits can be distributed however the members agree.

Why an LLC Might Not Be the Best Choice:

  • If you’re a non-resident, an LLC’s profits may be subject to U.S. self-employment tax (15.3%).
  • Investors prefer C-Corps, so if you’re planning to raise capital, an LLC could limit your options.

Best for: Solo entrepreneurs, service-based businesses, and companies that don’t plan on seeking outside investors.

Option 2: C-Corporation – The Go-To for Investors & Growth

A C-Corp is a separate legal entity, which means the corporation pays taxes on its profits, and then owners pay taxes again on dividends. Yes, that means double taxation but sometimes, it’s still the better option.

How C-Corps Are Taxed:

  • C-Corps pay a flat 21% corporate tax rate.
  • Shareholders pay tax on dividends (but at a lower rate if they’re qualified dividends).

Why a C-Corp Might Be a Smart Move:
 ✔ Investors Love C-Corps – If you plan to raise venture capital, this is your best bet.
 ✔ No Self-Employment Tax – Unlike LLC owners, C-Corp owners don’t have to pay self-employment taxes on profits.
 ✔ Lower Corporate Tax Rate – The 21% corporate tax rate is often lower than high personal tax rates.

Downsides of a C-Corp:

  • Double Taxation – First, the corporation gets taxed, then shareholders get taxed on dividends.
  • More Paperwork – Annual board meetings and corporate tax filings are required.

Best for: Businesses planning to scale quickly, attract investors, or reinvest profits into growth.

How to Set Up Your E-2 Visa Business the Right Way (Before You Land in the U.S.)

If you’re setting up an E-2 visa business, getting your finances in order before you arrive can save you a ton of hassle. Here’s what you need to do:

Step 1: Choose the Best Business Structure for Tax Savings

  • Want pass-through taxation and flexibility? Go with an LLC.
  • Need investor appeal and corporate tax benefits? C-Corp is the way to go.

Not sure? Our team at Insogna CPA—one of the top CPA firms in Austin, Texas—can help you make the smartest choice.

Step 2: Open a U.S. Business Bank Account

  • Required for tracking expenses and proving business legitimacy to immigration officials.
  • Keep personal and business finances separate (trust us, the IRS loves clean records).

Step 3: Register for an EIN & Payroll System

  • Apply for an EIN (Employer Identification Number) from the IRS.
  • Set up a payroll system if you plan to hire employees.

Step 4: Stay Compliant with State & Local Taxes

  • Some states (like Texas) have no state income tax. Others have franchise taxes for LLCs and C-Corps.
  • If your business operates in multiple states, you may need to file taxes in each one.

Pro Tip: A tax advisor in Austin (like Insogna CPA!) can help you navigate multi-state tax compliance.

Step 5: Work with a CPA Who Specializes in E-2 Visa Businesses

  • The S. tax system is complex, especially for international business owners.
  • A proactive Austin small business accountant (that’s us!) can help you reduce tax liability, stay compliant, and avoid costly mistakes.

Final Thoughts: Set Your Business Up for Success from Day One

Launching your E-2 visa business is exciting but setting up the right tax structure is key to protecting your profits. Whether you choose an LLC or a C-Corp, making the right decision from the start will save you time, money, and stress.

At Insogna CPA, a trusted Austin tax accountant, we help E-2 visa business owners:
 ✔ Choose the best tax structure for long-term success.
 ✔ Stay compliant with U.S. tax laws (so you don’t run into IRS trouble).
 ✔ Maximize tax savings so you can reinvest in growth.

Planning your U.S. business expansion? Let’s make sure you structure it for tax efficiency. Schedule a call with Insogna CPA today!

The Hidden Tax Risks of Out-of-State Projects: What Business Owners Need to Know

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Expanding your business to out-of-state projects is a thrilling growth opportunity, but it comes with a hidden challenge that could cost you—multi-state tax liabilities. Operating across state lines can unknowingly create tax obligations, leading to penalties, double taxation, or even lost profits.

With unclear nexus laws and state-specific tax rules, it’s easy for business owners to fall out of compliance. This guide explains how these tax risks occur and provides actionable steps to stay compliant and protect your bottom line. Insogna CPA, one of the best CPA firms in Austin,  Texas, specializes in proactive multi-state tax strategies to keep you ahead of the curve.

The Problem: Multi-State Projects Can Trigger Tax Liabilities

Engaging in projects outside your home state often creates a nexus—a legal connection to another state that obligates your business to pay taxes. Many business owners don’t realize they’ve triggered nexus until they receive a notice or penalty from a state tax authority.

Common Triggers for State Tax Obligations:

  1. Physical Presence: Having employees, contractors, inventory, or equipment in another state.
  2. Economic Nexus: Surpassing a state’s revenue threshold for selling goods or services.
  3. Service-Based Nexus: Performing work on-site or providing taxable services in a state.
  4. Payroll Obligations: Hiring in-state employees or contractors.

These scenarios can result in state income taxes, sales taxes, or payroll taxes that reduce your profits and complicate your operations.

Why It Happens: Confusing Nexus Laws Across States

Each state has its own nexus laws, making it challenging to keep track of tax obligations.

  • Physical Nexus Variations: While some states require a physical location to establish nexus, others consider occasional visits or temporary projects sufficient.
  • Economic Nexus Rules: States with thresholds (e.g., $100,000 in sales) often capture businesses that don’t realize they’ve exceeded them.
  • Complexity of Multi-State Filing: Filing taxes in multiple states without proper systems can lead to missed deadlines, inaccurate reporting, and penalties.

Without expert guidance from a trusted accounting firm in Austin, it’s easy to fall behind on compliance.

The Solution: How to Avoid Hidden Multi-State Tax Risks

To stay compliant and avoid unnecessary costs, follow these three steps:

1. Understand Nexus Rules in Every State You Operate

Before entering a new state for business, research its nexus laws and tax obligations.

Key Considerations:

  • Does the state require income tax filings based on economic activity?
  • Are services subject to sales tax in that state?
  • Will hiring a contractor trigger payroll tax obligations?

Example: A Texas-based construction firm performing work in Colorado may establish nexus by working on-site, requiring state income tax filings.

Pro Tip: Partner with an experienced Austin, Texas CPA like Insogna CPA to assess each state’s requirements and avoid surprises.

2. Register for State Tax Accounts Where Necessary

Once nexus is established, promptly register with the appropriate state tax authorities to avoid penalties.

Common Registrations Include:

  • Sales Tax Permits: Required for selling taxable goods or services.
  • Payroll Tax Accounts: For businesses hiring employees or contractors in the state.
  • Income Tax Filings: For reporting income generated from out-of-state activities.

Pro Tip: If you’ve unknowingly triggered nexus in the past, a trusted CPA firm in Round Rock, TX can help you register retroactively and negotiate reduced penalties.

3. Maintain Accurate Multi-State Records

Accurate record-keeping is essential for multi-state compliance.

What to Track:

  • Revenue earned in each state.
  • Time spent by employees on-site in other states.
  • Inventory or equipment stored in different locations.

Why It Matters: Proper documentation allows your CPA to prepare accurate returns and defend your business in case of an audit.

  1. Proactively Plan Your Multi-State Tax Strategy

A forward-thinking tax strategy ensures you remain compliant while reducing liabilities.

How a CPA Helps:

  • Tax Risk Assessments: Identify nexus triggers before expanding operations.
  • Streamlined Filings: Prepare state tax returns accurately and on time.
  • Tax Savings Opportunities: Discover deductions and credits available in specific states.

Action Step: Work with a small business CPA in Austin to create a proactive multi-state compliance plan that aligns with your growth goals.

Real Case Study: How Proactive Planning Can Save A Texas-Based Business $25,000

The Challenge:
 An Austin-based logistics company expanded into New Mexico and Oklahoma, triggering sales tax and income tax obligations without realizing it. After two years, they faced penalties exceeding $25,000.

The Solution:
 The company decided to partner with Insogna CPA, one of the leading accounting firms in Austin Texas, to assess their multi-state obligations.

Results:

  • They can file back their taxes and register retroactively, reducing penalties by 60%.
  • Their tax filings will be streamline across multiple states for future projects.
  • They can save $25,000 in penalties and fees through accurate filings and proactive planning.

Why Insogna CPA?

At Insogna CPA, we’re experts in multi-state tax compliance. As a trusted CPA firm in Austin, TX, we help businesses navigate complex nexus laws and protect profits.

Our services include:

  • Multi-State Nexus Analysis: Identify where your business has tax obligations.
  • Compliance Support: Manage registrations, filings, and audits seamlessly.
  • Proactive Planning: Develop tax strategies that minimize liabilities and support growth.

Whether you’re working on out-of-state projects or expanding your online sales, our team keeps you compliant and profitable.

Take the Stress Out of Multi-State Taxes

Out-of-state projects shouldn’t create unnecessary tax risks for your business. With proactive strategies and expert guidance from Insogna CPA, you can confidently expand into new markets while staying compliant.

Contact Insogna CPA today to schedule a consultation and protect your business from hidden tax liabilities.

How to Maximize Your eCommerce Tax Deductions (and Keep More of Your Hard-Earned Profits)

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You’ve built your eCommerce business, put in the late nights, and watched your sales grow. But when tax season rolls around, does it feel like all your hard work is just funding the IRS? If you’re not maximizing your deductions, you could be leaving thousands of dollars on the table.

At Insogna CPA, a top Austin, Texas CPA firm, we help eCommerce sellers keep more of their money while staying tax-compliant. Let’s break down the most overlooked tax deductions, how to track them properly, and why a proactive tax strategy is the key to paying less.

Know What You Can Deduct And Take Advantage of It

Not all expenses are created equal. Some put money back in your pocket, while others just drain your profits. The key? Knowing what’s deductible and making sure you claim it.

1. Home Office Deduction

If you’re running your store from home, you could be writing off part of your rent, utilities, and internet as long as you have a dedicated workspace.

Pro Tip: The IRS won’t let you deduct your couch, but that spare bedroom-turned-warehouse? Now we’re talking.

2. Shipping & Delivery Costs

Every box you send out is an expense. That means postage, packaging, shipping insurance, and tracking costs are all deductible.

Make sure you’re tracking:
 ✔ USPS, FedEx, UPS costs.
 ✔ Packing materials (boxes, tape, labels).
 ✔ Fees for expedited shipping or return handling.

2. Merchant & Payment Processing Fees

Shopify, Etsy, Amazon, Stripe, PayPal—they all take their cut. Luckily, those transaction fees are tax-deductible.

✔ Every little percentage adds up. Deduct them to shrink your tax bill.

3. Marketing & Advertising Costs

The money you spend to get your brand in front of customers is deductible.

✔ Facebook, Instagram, Google Ads.
✔ Branding, logo design, photography, and influencer collaborations.
✔ Email marketing software like Klaviyo or Mailchimp.

Pro Tip: If you paid an influencer to promote your product, that’s marketing—write it off!

4. Inventory Costs (But Only When You Sell It!)

Inventory isn’t deducted when you buy it—it’s deducted when you sell it as part of Cost of Goods Sold (COGS).

✔ Keep good records of what you buy, what you sell, and what’s left in stock.
✔ If you store inventory at a fulfillment center or warehouse, those fees are deductible too.

5. Business Travel & Education

If you travel for trade shows, supplier meetings, or industry conferences, your flights, hotels, and business meals are deductible.

✔ Flights, hotel stays, and rental cars.
✔ 50% of business-related meals.
✔ Online courses, coaching programs, or business books.

How Insogna CPA Helps: We’ll organize your expenses so you’re claiming every possible deduction without the IRS side-eyeing you.

Bookkeeping: The Secret to Bigger Deductions

You know what’s worse than overpaying on taxes? Overpaying because your books are a mess.

If your receipts are scattered, your inventory isn’t tracked, or your transactions are mixed with personal expenses, you could be missing out on deductions you rightfully deserve.

How Clean Books = More Tax Savings:

✔ You track every deductible expense in real-time.
✔ You avoid IRS audits by keeping your records organized.
✔ You make tax season painless—no scrambling, no stress.

Bookkeeping Tips for eCommerce Sellers:

✔ Use QuickBooks or Xero to track income & expenses automatically.
✔ Keep digital copies of receipts (apps like Expensify make it easy).
✔ Hire an Austin small business accountant (like us!) to clean up your books and find hidden savings.

Why Work With Us? At Insogna CPA, we offer monthly bookkeeping services so you can focus on growing your business, not sorting receipts.

Plan Ahead to Legally Lower Your Taxes

Most business owners think about taxes in April. Smart business owners start planning in January.

A proactive tax strategy can save you thousands every year. Instead of just preparing your tax return, we help you reduce your taxable income legally.

Here’s How Tax Planning Saves You Money:

Quarterly Estimated Taxes – Avoid IRS penalties by paying the right amount throughout the year.
Income Distribution – Structure your salary and business income to minimize self-employment tax.
Retirement Contributions – Use a SEP IRA or Solo 401(k) to reduce your taxable income while saving for the future.

How Insogna CPA Helps: We’re not just tax preparers, we’re tax strategists. We help eCommerce sellers create a plan to pay less and keep more.

The Real Cost of Missing Deductions? Overpaying the IRS

Let’s do some math. If you miss $10,000 in deductions and your tax rate is 25%, that’s $2,500 extra you just handed to the IRS.

Do that for a few years, and you’ve lost tens of thousands of dollars that could have gone toward:

  • Scaling your business.
  • Launching new products.
  • Taking that vacation you’ve been dreaming about.

Why give the IRS more than you need to?

Let’s Make Sure You’re Keeping More of Your Profits

At Insogna CPA, we specialize in helping eCommerce business owners like you maximize deductions, reduce taxable income, and stay compliant. Whether you’re a Shopify seller, Amazon FBA entrepreneur, Etsy shop owner, or independent eCommerce brand, we’ve got your back.

📞 Tired of overpaying on taxes? Contact Insogna CPA today and let’s start saving you money!