How to Do Payroll and Taxes Yourself
Access to a limited workforce makes it hard for small businesses to grow and thrive. If you own a small business, you will be the one to take care of all the tasks from administrative to marketing, which can be challenging. Hiring a team to handle the activities might not be financially sustainable, especially at the beginning stages. It, therefore, means that you will be required to take care of all the tasks yourself irrespective of the degree of expertise required. One of the tasks that every small business owner should learn how to handle is the preparation of payroll and taxes. Read on to learn how you can handle taxes and payroll services for your small business.
The first step to doing taxes and payroll yourself is having an Employer Identification Number (EIN) for your business. Applying for an Employer Identification Number (EIN) is one way of information the Internal Revenue Service (IRS) about the existence of your business. It is a way of protecting your business against the Federal Government that requires all businesses to be tax-compliant. If you want to know the process of applying for EIN, click here for more info. now. Next, you need to inform the IRS if your workers are either employees or independent contractors. If your workers are employees, then they will be required to fill W4 forms. In the case of independent contractors, they will have to fill W-9 forms.
Having a payment schedule will make the process of doing taxes and payroll much easier. Some of the crucial dates that you should note are employee pay dates, tax due dates, and tax filing dates. Always have in mind the state regulations when setting the dates. Now that you are aware of the dates, you should focus on getting the money ready to avoid delays. Paying taxes is usually a big challenge to many small business owners, and it is common for them to have issues with the IRS. Withholding the correct amount will ensure that you don’t get into problems with the IRS. If you are not sure about the amount to withhold, you should use an IRS Withholding Calculator or paycheck calculator.
Record keeping is a crucial task for every business owner to boost efficiency. The best way to keep your tax records is by making a pay stub. On the homepage of this website, you will learn a few tips for making a pay stub. The next thing is filling all the tax forms. Filing of tax forms should be done on time to avoid issues with the authorities and fines.
Since tax preparation is a complicated process; most small business owners opt for payroll services. Ensure that you find the best payroll services for your small business. Therefore, if you want to do payroll and tax services yourself, you should use the ideas discussed in this guide.