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» From: Indianapolis, IN Dear TaxMama: I need to know when Federal taxes (unemployment, medicare, social security, etc.) are due? And what form do I need to fill out to send it in? PLEASE HELP. Lisa Dear Lisa, I can tell you right now, you SOOOO don't want to do this yourself. While it looks easy, (pause for laughter here) there are so many idiotic things you can overlook, you just don't even want to know how much trouble you can get into. But, if you must ... Payroll taxes returns are filed on a quarterly basis. That means, the year is broken up into four parts (quarters), and the tax returns are filed during the month AFTER each segment:
The Form 941 is your regular form to report the wages each quarter. This is where you report and pay for the IRS taxes withheld from paychecks, the Social Security and Medicare taxes. Form 940 is the annual unemployment form. (This is last year's form. The new one won't be issued for several months but, this URL will work when it is.) You will report your total wages, but only pay taxes on the first $7,000 of each employee's wages at the net rate of .8% . (That's eight tenths of a percent, NOT eight percent - watch that decimal point!) If your total balance due in any quarter for all your employees adds up to $100 or more, you have to pay the tax before you file the annual form. So you'll be using Form 8109 to pay this. The form isn't on the IRS site. It's in that yellow coupon book IRS sent you when you got your Federal ID number. If you don't have one, call IRS's forms number now - 800-TAX FORM The W-3s are the cover sheet for all the W-2s you need to file. And, even if you have only one W-2, you need that cover sheet. 1099s will be issued to every person to whom you paid $600 or over in the course of your business for SERVICES (not merchandise) or rents. When you pay corporations, you don't have to send them a 1099. However, anytime you pay attorneys for business purposes, you must send them 1099s, even if they are incorporated. This is it in a nutshell. Now, having said all that, I will tell you this - if you've never done payroll taxes before, get a professional to do them for you. Sure, it may cost you $30+ per month. But it will save you more trouble than you can imagine in the long run. Payroll tax problems are the number one reason small businesses get in over their head - and ultimately fail. You will find some recommendations for some reliable companies towards the bottom of TaxMama's Tax Resources page. Good luck. And do be careful. Best wishes, Eva Rosenberg Your TaxMama  |
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