How to Do Payroll and Taxes Yourself
Running a small business is usually more challenging because of the limited workforce. As a small business owner, you will be required to focus your time, energy, and talent on different tasks of the business. Hiring a team to handle the activities might not be financially sustainable, especially at the beginning stages. As a small business owner, you should be prepared to take care of most of your business tasks yourself, even if they are challenging. 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.
As a small business owner, before you start preparing taxes and payroll for your team, you should apply for an Employer Identification Number. EIN is an important number since it makes your business known to the IRS. 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. Once you get the EIN, you should clarify if your workers are employees or independent contractors. If your workers are employees, then they will be required to fill W4 forms. On the other hand, if the workers are independent contractors, they will need to fill W-9 forms.
Having a payment schedule will make the process of doing taxes and payroll much easier. Employee pay dates, tax due dates, and tax filing dates are some of the important dates that must appear in your payment schedule. The dates should be in compliance with the dates set by the IRS or federal government. Now that you are aware of the dates, you should focus on getting the money ready to avoid delays. Since the preparation of taxes is a sensitive matter, most businesses usually find themselves on the wrong side of the IRS laws. If you want to avoid issues with the IRS, you should withhold the correct amount. With the help of the IRS Withholding Calculator or paycheck calculator, you will know the right amount to withhold.
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. If you want to know to make a good pay stub for your business, you should click on this website now! Besides, you should have all your tax forms filed. The best way to avoid fines is paying the taxes on time.
A majority of business owners outsource payroll services to avoid doing the challenging task. Hiring payroll services will ensure that you do not make any mistake in the process and comply with all the IRS laws and guidelines. As a small business owner, if you want to do taxes and payroll services, you should follow these useful steps.