Incorporating a startup in the United States comes with exciting growth opportunities—and critical US tax obligations for startups.

While taxes might not be the most thrilling topic, understanding them is crucial for staying compliant and avoiding penalties.

Whether you’re launching a C-Corp or an LLC, understanding startup taxes is non-negotiable. Filing the right forms at the right time doesn’t just keep you compliant—it sets the foundation for growth, investor trust, and long-term success.

This is a foundational guide for startup founders navigating U.S. tax obligations designed to serve as a central resource you can revisit year-round.

💬 Book a free call with our team to clarify this for your startup.

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What we’ll cover in this guide:

• Who needs to file startup taxes (even with $0 revenue)
• What taxes apply to startups (federal, state, payroll, sales, and more)
• Deadlines you can’t miss
• Key IRS forms for C-Corps and LLCs
• Tax mistakes to avoid
• How to plan ahead and optimize your financial strategy

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Do you need to file startup taxes?

Yes—even if you didn’t make a dollar.

If your startup has an EIN (Employer Identification Number), the IRS expects you to file.

And no, it’s not a good idea to DIY your tax filings. Here’s why startups should work with a tax professional:

• Complex filing requirements: Filing a return isn’t just filling out a form—it often involves multiple schedules and compliance documents.
  
• R&D surprises: Many founders don’t realize that R&D costs aren’t always fully deductible, even at early stages.
  
• Costly mistakes: Errors can lead to IRS penalties and complicate future fundraising or exits.
  
• Available credits: You might qualify for valuable credits like the R&D tax credit, even without profits—but proper documentation is key.
  
• Multi-state exposure: You might owe taxes in more states than you think.
  

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Why understanding taxes is crucial for startups

Taxes aren’t just a legal requirement—they’re strategic. Staying on top of your tax obligations can:

• Help you avoid penalties and late fees
• Build credibility with investors
• Improve cash flow through smart planning
• Keep you focused on growth, not admin work
  

Startups that take their tax compliance seriously are better prepared for due diligence and capital raises.

Proper tax planning is also a sign of operational maturity. Investors often ask for past tax returns, financial statements, and clarity on any open tax issues during funding rounds. A clean tax record can speed up due diligence and increase your chances of securing investment.

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What key US taxes startups must file?

Understanding which taxes apply to your startup depends on your entity type, your state of incorporation, and where you operate. Here are the main categories:

1. Federal income tax

All business entities must file, though structures vary:

• C-Corps pay a flat 21% corporate tax.
  
• LLCs/S-Corps are pass-through entities, so income is taxed on personal returns.

‍Deadline: April 15 (or March 15 for partnerships/LLCs)

2. State income tax

Varies by state. Some, like Texas, don’t require it—but others (like California or New York) do.

In some cases, you may owe taxes in multiple states depending on where you have employees, customers, or other nexus points.

3. Payroll tax

Includes Social Security, Medicare (FICA), and unemployment (FUTA). Employers must both deduct and contribute. Even early-stage startups with a single employee (including founders on payroll) are required to comply.

Deadline: Usually filed quarterly

4. Sales tax

Applies if you sell taxable goods or services. Varies by state. If your startup is SaaS-based or digital, your sales tax obligations can get tricky—some states tax digital goods, some don’t.

5. Franchise tax

Required in states like Delaware or California. This is a fee for doing business in that state. Delaware, for example, requires all C-Corps to pay a minimum of $400 annually, but the amount can rise depending on your valuation or number of shares.

Deadline: Varies by state, e.g. March 1 (Delaware)

6. Excise tax

Applies to certain goods or services (like alcohol or fuel). Most startups won’t deal with this unless operating in regulated industries. If you’re unsure, it’s worth checking—noncompliance can lead to steep penalties.

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2025 US tax deadlines for startups

Missing a filing deadline can cost you in penalties and investor confidence. Get ahead with our complete 2025 tax calendar.

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📥 Download the free startup tax calendar to stay on top of key IRS dates.

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Tax deadlines for startups tend to follow a predictable seasonal rhythm, but missing one can still create serious headaches. Most IRS and state filing deadlines occur in March, April, and September:

• March 1: Delaware Franchise Tax (for Delaware C-Corps)
  March 15: Partnership returns (LLCs with multiple members) and S-Corp filings
• April 15: The big one—C-Corp Form 1120, personal income taxes, Form 5472, 5471, FBAR, and the deadline to make a Section 83(b) election
• September 15: Extended deadline for Form 1120 and other business filings (if you filed for an extension)

It's critical to prepare early—many of these filings require supporting documents that take time to compile, like financial reports, cap tables, or board resolutions. If you missed the 83(b) window, didn’t file Form 5472, or forgot about the FBAR, it’s not the end of the world—but you’ll want to talk to a tax advisor right away to minimize penalties or risks.

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What tax forms does your startup need to file?

Understanding which forms apply to your entity structure is essential. Here’s a breakdown:

If you have a C-Corp

✔️ Form 1120

This is the corporate income tax return for U.S.-based C-Corps. It includes your total income, deductions, and tax liability for the year. Learn how to file Form 1120.

✔️ Form 5471

Used by U.S. persons who are officers, directors, or shareholders in certain foreign corporations. It reports ownership and financial details. Learn more about Form 5471

✔️ Form 5472

Filed by U.S. corporations with foreign owners or transactions. It discloses information about related-party transactions and foreign ownership. Learn more about 5472

✔️ FBAR

The Foreign Bank Account Report is required if your company holds foreign bank accounts totaling over $10,000. It helps prevent offshore tax evasion. Learn how to file the FBAR

✔️ Section 83(b) election

It lets founders pay taxes on stock when it’s granted rather than when it vests—often reducing total tax liability. This must be filed within 30 days of the stock grant.  📥 Download the 83(b) election workbook.

✔️ Delaware Franchise Tax

An annual tax for companies incorporated in Delaware. It’s based on shares authorized or company valuation. Find out how to file your Delaware Franchise Tax step by step.

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If you have an LLC

✔️ Form 1065

This is the annual return of income for partnerships and multi-member LLCs. It includes the company’s total income, expenses, and distributions. Check out our form 1065 guide

✔️ FBAR (if applicable)

Required if your LLC has foreign accounts with balances over $10,000. This is separate from your federal income tax return. Learn more

You might also need to file Schedule K-1s for each member of the LLC, detailing each partner’s share of income and deductions.

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Compliance made easy

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What documents do you need to complete your startup’s tax return?

Filing accurately starts with documentation. Be ready to share the following with your tax preparer:

Corporate information

• EIN confirmation
• Incorporation documents
• Cap table and ownership structure
  

Financial documents

• Profit & loss statement
• Balance sheet
• General ledger
• Payroll records

Prior year returns (if any)

• Useful for carryforward losses or credits

Additional helpful materials

• Investor SAFE agreements
• Records of R&D expenses
• Stock option grants or equity awards
  
  

Keeping this information organized not only speeds up tax prep—it helps during fundraising, audits, and board reporting.

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Common tax mistakes startup founders should avoid

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1. Misclassifying workers — Don’t confuse contractors with employees.
2. Ignoring state-level taxes — You may owe taxes in more than one state.
3. Missing estimated tax payments — These apply if you have significant revenue.
4. Forgetting tax credits — R&D, employee retention, and more may apply to your startup.
5. Not reconciling your books before tax season — Clean books = faster, more accurate filing.
6. Waiting too long to ask for help — If you’re unsure, get advice before the IRS gets involved.

⚠️ Mistakes now can hurt you later during due diligence. Avoid the headache—book a free call with our team.

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Tackle tax season with confidence

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Startup tax planning

Tax compliance is just the starting point. Real financial strategy begins when you shift from reacting to planning.

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A strong tax plan helps you:

• Create financial stability by integrating tax planning into your broader financial roadmap. When you know what’s coming, you can anticipate expenses, adjust your cash flow, and allocate resources more intelligently.
  
• Maximize cost efficiency by using all the tools available to reduce your tax liability, like startup-friendly deductions, accelerated depreciation, R&D tax credits, and even choosing the right accounting method.
  
• Minimize risk by keeping your filings clean, avoiding late fees or penalties, and staying prepared in case of audits or due diligence reviews. This is particularly critical for startups raising capital.
  
• Build trust with investors by demonstrating control over your financials. A clear, organized tax strategy signals maturity and shows you’re serious about how the business operates.
  
• Enable long-term growth by aligning tax strategy with company goals. Whether you’re expanding globally, hiring, or preparing for a fundraise, planning ahead helps you stay agile and compliant.
  
  

A solid tax plan considers:

• Your burn rate and cash runway
• Timing of expenses and reimbursements
• Allocation of R&D credits
• Employee classification and compensation structure

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Effective tax planning isn’t just about saving money—it’s about making confident, informed decisions that strengthen your operations.

If you’re unsure where to begin, remember that your tax strategy is only as strong as your bookkeeping and forecasting. That’s why our guides on bookkeeping and fractional CFO support are a great next step.

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Lazo is your tax partner from day one

We help startups navigate every stage of tax compliance—so you can stay focused on building your company.

• Federal and state tax filings
• 83(b), FBAR, Franchise Tax and more
• Integrated with bookkeeping for year-round readiness
• Expert consultants, fast response, clear guidance
  
  

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If you’re unsure where to start, we’ll walk you through it.

💬 Ready to simplify startup taxes? Book a free call today.

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