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My wife an I usually file taxes ourselves using the 1040A (with the standard deduction), but she started her own business this year selling jewelry. Most people are recommending to use a CPA for help with taxes, but I actually enjoy doing things like this myself.
Are there any good resources online for small business taxes? How about state (Minnesota) taxes? Am I making a mistake trying to do this myself?
I think you're making a mistake. If you still want to make this mistake (I'll explain later why I think its a mistake), the resources for you are:
IRS.GOV - The IRS official web site, that has all the up-to-date forms and instructions for them, guiding publications and the relevant rules. You might get a bit overwhelmed through.
Software programs - TurboTax (Home & Business for a sole propriator or single member LLC, Business for more complicated business), or H&R Block Business (only one version that should cover all) are for your guidance. They provide tips and interactive guidance in filling in all the raw data, and produce all the forms filled for you according to the raw data you entered. I personally prefer TurboTax, I think its interface is nicer and the workflow is more intuitive, but that's my personal preference. I wrote about it in my blog last year. Both also include plug-ins for the state taxes (If I remember correctly, for both the first state is included in the price, if you need more than 1 state - there's extra $30-$40 per state).
Your state tax authority web site (Minnesota Department of Revenue in your case).
Both Intuit and H&R Block have on-line forums where people answer each others questions while using the software to prepare the taxes, you might find useful information there.
As always, Google is your friend.
Now, why I think this is a mistake.
Mistakes that you make - will be your responsibility. If you use the software - they'll cover the calculation mistakes. But if you write income in a wrong specification or take a wrong deduction that you shouldn't have taken - it will be on your head and you're the one to pay the fines and penalties for that.
Missed deductions and credits - CPA's (should) know about all the latest deductions and credits that you or your business might be entitled to. They also (should) know which one got canceled and you shouldn't be continuing taking them if you had before.
Expenses - there are plenty of rules of what can be written off as an expense and how. Some things should be written off this year, others over several years, for some depreciation formula should be used, etc etc. Tax programs might help you with that, but again - mistakes are your responsibility.
Especially for the first time and for the newly formed business, I think you should use a (good!) CPA. The CPA should take responsibility over your filing. The CPA should provide guarantee that based on the documents you provided, he filled all the necessary forms correctly, and will absorb all the fees and penalties if there's an audit and mistakes were found not because you withheld information from your CPA, but because the CPA made a mistake. That costs money, and that's why the CPA's are more expensive than using a program or preparing yourself. But, the risk is much higher, especially for a new business. And after all - its a business expense.
