When you first started your own company, you may not have anticipated its growth. Now, rather than running a solo operation, you have employees who work for you. While that may make you feel important and proud because it means that your company has grown and seen at least some successes, it also means you have more responsibilities.
In particular, you have the obligation of processing payroll for your employees. This includes addressing payroll taxes. Of course, when it comes to handling any type of tax obligation, complications can ensue, so you certainly want to make sure that you handle your payroll correctly.
What goes into payroll?
If hiring employees is somewhat new, you may have not yet gone through the first payroll process. As a result, you need to make sure that you pay attention to the following elements:
- The hourly rate of your employees
- How often you pay your employees
- Tax withholding information from your employees
- How much your employees will receive after the deduction of payroll taxes and other obligations
- Writing the paychecks and issuing them to your employees
- Reporting the pay and payroll tax information to the applicable federal and state tax agencies
Lastly, you will need to ensure that you pay the payroll taxes when they are due.
When do you make payments?
Making payroll tax payments is not the same for every company. You could need to make those payments on a semi-weekly basis or just once a month. The amount you pay will include what you owe as an employer to Social Security and Medicare, what you deducted from your employees' pay for Social Security and Medicare, and the federal and state tax amounts you withheld from your employees' pay.
The manner in which you make these payments may differ based on your preference, but there is an electronic filing system for the IRS, through which you can make your necessary payroll tax payments.
What if mistakes occur?
As mentioned, any type of tax matter can prove complicated, and as a relatively new employer, you may not fully understand payroll taxes or the importance of making those payments on time. In the event that a mistake with your payroll taxes causes you to face an audit or other action from the IRS, you may want to ensure that you handle the situation as best as possible. Fortunately, a Connecticut tax attorney could help you address this and any other tax-related issue you could endure.