new business tax forms...

[YoungTreeGuy]

Spent hours reading on the irs website about forms and regulations. Ended up with a head ache. Haven't even looked at state tax information because the fedral driving me nutz. I want to employ one guy. I have worker comp quote and disabilty qoute...

Now my biggest questions are:

1) when do I pay self employment tax
2) how do I determine fedral and state tax with holdings fomr my employee
3) how do I determine how much unemployment insurance is and when to pay it
4) do they fill out w2 or w4?


Gotten very lost and confused..

 

[mckeetree]

Spent hours reading on the irs website about forms and regulations. Ended up with a head ache. Haven't even looked at state tax information because the fedral driving me nutz. I want to employ one guy. I have worker comp quote and disabilty qoute...

Now my biggest questions are:

1) when do I pay self employment tax
2) how do I determine fedral and state tax with holdings fomr my employee
3) how do I determine how much unemployment insurance is and when to pay it
4) do they fill out w2 or w4?


Gotten very lost and confused..

Is this post a joke? If not, hire a CPA post haste.

 

[Storm56]

An accountant will take care of all of these issues and keep your nose clean. And as a rule they do not charge a lot for this service. Oh and his fees are tax deductible too!

 

[YoungTreeGuy]

I figured I would probably end up going to a tax pro. Just trying to understand what I'm getting into so a few months down the road if something goes wrong... I understand what's going on. Got a ball park figure per month?

 

[Storm56]

If you are just starting out I suggest buying a payroll program to figure your employees paychecks. The one I use is put out by Medlin. Do a search for Medlin.com. They have several accounting programs but I just buy the payroll one, cost me $50 a year. It works very well.

It will generate a lot of your reports but I pay my accountant to do my quarterlies. I have 5 employees and my accountant usually charges me like $125 each quarter to do all the reports.

 

[ATH]

I think it is wise for you to try to figure out what is going on as much as possible (but since, based on my experience, the IRS doesn't entirely know what is going on don't ever think you will 'get there').

I use a payroll program called ZPay Payroll Systems. It is pretty user friendly. Even with that, about this time every year I bang my head against the wall and think that it isn't even worth hiring employees. So, while I encourage you to understand what is going on an accountant is probably a good idea.

Depending on how frequently you want to hire somebody (part time, intermitent) another good idea could be working through a temp agency. If you don't want the luck of the draw, you can tell them "I want my friend Bob Smith to work for me through your service" and they'll take care of everything. He is not even your employee, so the paperwork is all on them. But if you are looking for more regular help, this is probably a less desirable route financially speaking.

 

[VA-Sawyer]

I worked for H&R Block for years in the winters. The Federal stuff for one or two employees isn't that hard.
Step 1 get a Federal Employer ID Tax number. You can do this online at the IRS web site.

Step 2 When you hire an employee, have them fill out the W-4 form and the I-9 form, before they do any work for you. You can print the W-4 from the IRS website and you can Google the I-9

Step 3 Order a current copy of Federal Publication 15 . (AKA Circular E ) from the IRS website. This booklet tells you how much to withold from each paycheck. The Social Security is by a fixed percentage as is the Medicare. There are tables to figure the Federal Income tax to withould from each check based on how often you pay, how much they earn, their martial status and how many exemptions they claim.
I just print out the correct page for each employee and use it for the year.

Step 4 At the end of Mar, June, Sept and Dec. Total up the payroll info and do the IRS Form 941 for that quarter. Even if the numbers are zero you still have to fill out the form. I do it online at the IRS site and print out the copy to send in with the money.

Step 5 At the end of the year, Fill out W-2's for each employee you paid during the year. I do these online at the Social Security website. File the federal forms online and print out copies to send to the employees.

Step 6 Also at the end of the year, Do the Federal Unemployment Tax form 940. It may end up as zero tax, but work the complete form to see.

I have no experience with the state of NY but will bet the steps are pretty much the same. I did a quick search for NC dept of revenue online when I moved from VA to NC. Went to the County Clerks office to fill out the paperwork for my DBA ( registering the business name ) Then did the rest online with the state.

Quickbooks wanted $100 per year for the payroll add on. I probably spend 10 hrs per year doing the paperwork, so I figure I'm paying myself $10 per hour to do it my self. As I'm not busy full time yet, I'll keep the savings. When I'm working full time and keeping at least 1 guy busy full time, then I'll hand it over to someone else and pay them.
Rick