When Cash is a Red Flag
While people may be glad to have work and be getting a paycheck, there is a red flag that should fly high and furiously if seen: (more…)
Posts Tagged The Payroll Department
Know the Difference between Salary and Wage Duties
Are you a small business employer who has a hard time figuring out which employees can be paid a salary and which must be paid hourly? If so, you’re not alone. Many small business owners often have trouble making these determinations. But it’s important that you know the difference between exempt and non-exempt jobs, otherwise you may have to pay hefty fines due to misclassification of workers in the workplace. (more…)
SPECIAL NOTE! 3 Mandatory Employee Notices Due in January
Most small business owners know that they need to distribute their business’s 2014 W-2 forms to their employees before the end of January. But did you know that you also need to supply other year-end employee notices, too?
Annually, you should review all requirements concerning Federal and state employee notification reports, especially those containing supplemental tax information for your employees. You should prepare and distribute any mandatory reports to your employees to help them fulfill their personal tax filing obligations. Some mandatory notices that you’re required to provide to your employees include:
- The special accounting rule/no federal income tax withholding on personal-use auto notice. If you provide employees with a company vehicle that they can drive for personal use, in most cases, this personal use is considered a taxable fringe benefit. As an employer, you’re responsible for withholding taxes on the fair market value (FMV) of this benefit, which is determined at least once a year. If you determine the FMV based on monthly valuations, you can simplify your tax reporting by using a special accounting rule that allows you to use the value of the fringe benefit for November and December of the calendar year, and combine that valuation with the value of the first ten months (January through October) of the following year. If you used this special accounting rule in 2014 to determine FMV, or you plan to not withhold federal income tax from the value of your employee’s personal use of company vehicles in 2015, you must provide employees with a notice by February 2, 2015. For more information, refer to the IRS Employer’s Tax Guide to Fringe Benefits.
- Charitable contributions report. If your employees make charitable contributions to national or local non-profit organizations through payroll deductions, you’re required to report to each employee the annual total of charitable contributions the individual made. Consider using box 14 of the Form W-2 to report this annual total.
- Earned Income Tax Credit (EITC) notice. The EITC is a tax credit for low-income working families. For federal purposes, the back of Copy B of the Form W-2 includes eligibility information about the EITC for your employees that meets notification requirements. However, some states may require a separate notification (other than the Form W-2, Copy B) and have a different annual deadline for notifying your employees about the EITC. To get the word out about this tax credit, January 30, 2015 is EITC Awareness Day.
Besides mandatory employee notifications, you also should consider processing and distributing other reports that may be helpful to your employees in completing their taxes as well.
If you need help identifying all of the mandatory and optional employee notifications your small business should make, contact The Payroll Department at 317-852-2568. By engaging the services of a professional payroll services provider, we’re your experts in all things concerning your payroll.
– Ariane of The Payroll Department Blog Team
A Different Perspective on Small Business Payroll Taxes
There is no question that running a small business today is tough. Every expense and additional small business taxes makes it harder to make a profit and stay in business.
But small business owners and entrepreneurs have one thing to be thankful for… most of them don’t have to pay luxury taxes. Now if you will stretch your imagination and consider Major League Baseball teams as businesses, I’d like to share a recent news bit. (more…)
Posted in: Payroll, Payroll Processing, Payroll Taxes
Leave a Comment (0) →9 Valid Reasons for Small Business Owners to Outsource Payroll
Some small business owners make decisions that end up costing them more in the long run. If they keep late hours and miss weekend fun with friends and family, it takes a toll. They are also in grave danger of costing themselves more money than what they are trying to save, by doing their own payroll. The staff at The Payroll Department provides you with 9 valid reasons why you should call on us.
- Cost: Huge companies can maintain a payroll But if your business employs fewer than 20 jobs for workers, you can save money by contacting The Payroll Department. Figure out how many hours you or an employee spends each month on payroll. Add the time spent researching ever-changing tax laws and money spent on paper and ink, printing and distributing paychecks and creating payroll tax documents.
Accuracy: Payroll mistakes make employees angry and suspicious of you. Those mistakes can also alert the government, which might later result in an audit.- Reliability: If you or an employee does payroll each pay period, reliability is based solely on not making a single error. The Payroll Department can do a better job of staying current with employees’ vacation hours, overtime pay, garnishments, etc. Why? Because, unlike you, that’s the only job we are doing for your small business.
- Speed: The Payroll Department staff are specialists. We have the technological resources to handle any temporary changes in your payroll, such as seasonal workers, contract workers, etc.
- Insight: The Payroll Department knows the ins and outs of payroll tax laws as well as federal, state and local regulations. Do you have the time to stay current with this information?
- Accountability: When your small business is in our very capable hands, we understand and respect our accountability to you, by law. It is part of our promise to you that we have a third-party bookkeeping service audit every client account one per quarter.
- Flexibility: Most entrepreneurs quickly get tired of wrestling with payroll. When we take this burden off your shoulders, you have time to do what you’re best at doing and growing your business.
- Security: When we are in charge of providing payroll services for your business, you don’t have to worry that employees handling the payroll might be embezzling from your business instead of simply doing the payroll.
- Worry: We guarantee you’ll sleep better at night. And you’ll spend your work days doing what comes most naturally to you, running a profitable small business.
Neither payroll nor taxes are business tasks any small business owner can afford to miss or handle inaccurately. Give yourself a break! Call on The Payroll Department. We’re on your team!
-Sherri of The Payroll Department Blog Team
