Posted on: 26 July 2017
If you ever spent any time as an employee, you know that in order to get your check, that your employer needs your hours so that they can complete their payroll. It is pretty simple when you are on the employee side of things – just submit your hours to your employer and wait for your paycheck. When you are on the employer side of things though, it is a little more complicated. If you are currently making the switch from being on the employee side of things to the employer side of things as a small business owner, here are five things that you should do to ensure that you understand how payroll works.
#1 Get Assistance From The IRS
To start with, get some assistance with your payroll from the IRS. The IRS not only collects taxes, they make efforts to ensure that people understand the taxes that they need to collect from them. Start by looking at all the documentation and information provided under the employment tax section on the IRS website. This is a great place to get important employment tax information first hand from the source.
Keep in mind that you also need to save all of your employment tax records for four years. All of the documentation that the IRS expects you to keep concerning payroll tax records is spelled out on a list on their website.
#2 Learn About State Payroll Requirements
Second, you are going to want to make sure that you understand any state-specific payroll tax laws that you need to follow. Two great ways to learn about payroll is by reaching out to a Small Business Development Center in your area or by researching on your state website. Both of these resources should help you find the information that you need in order to comply with state specific payroll tax law.
#3 Hire An Accountant or Tax Professional
It is important to be self-educated about federal and state payroll taxes so you can ensure that your business is compliant with both federal and state rules and regulations. However, even understanding the rules that you need to follow doesn't necessarily make actually executing your payroll any easier.
It is a good idea to hire an accountant or Dave Ramsey recommended tax professional when you are setting up your small business. This does not have to be a full-time employee that you are required to pay benefits to. Many accountants and tax professionals work as independent contractors, which means that you only need to pay them for their work and don't need to work about payroll taxes or benefits for that employee.
They can help you set up a system for your payroll. They can fulfil your payroll every pay period, be that every week, two weeks or a month. They can even assist you with other accounting issues as well, beyond payroll, if you need guidance.
It is best to hire an accountant to help with payroll if you don't understand the exact ins and outs of payroll because this is an area of your business where you need to make sure that you are following both federal and state laws and requirements with each pay period.Share