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When it comes time to pay payroll taxes, you don’t need to worry about problems arising if you take the appropriate actions throughout the year.
Step 1 – Report Honestly
Never report false numbers. Similarly, always put forth the set amount of money towards your employees’ payroll taxes and do not evade doing this. By keeping close, accurate records and paying what you owe, you can avoid any trouble with the IRS when you pay payroll taxes.
Step 2 – Be Familiar with the Forms
Some states require employers to pay payroll taxes while some do not. However, employers in all states are subject to the federal payroll taxes, so you should familiarize yourself with the forms as early as possible to avoid any future confusion. These forms include the Wage and Tax Statements (Form W-2), the employer’s quarterly payroll tax return (Form 941), the Annual Return of Withheld Federal Income Tax (Form 945), and the annual federal unemployment tax return (Form 940 or 940EZ).
Step 3 – Check Your Reports
Before filing the forms, make sure that there are no mistakes. A mistake, even an honest one, can result in a difficult blow to your business in the form of an IRS-issued Trust Fund Recovery Penalty. This penalty requires you to pay 100 percent of whatever you should have originally paid, plus interest. You should do your best to pay payroll taxes as responsibly as possible to avoid this penalty.
Step 1 – Report Honestly
Never report false numbers. Similarly, always put forth the set amount of money towards your employees’ payroll taxes and do not evade doing this. By keeping close, accurate records and paying what you owe, you can avoid any trouble with the IRS when you pay payroll taxes.
Step 2 – Be Familiar with the Forms
Some states require employers to pay payroll taxes while some do not. However, employers in all states are subject to the federal payroll taxes, so you should familiarize yourself with the forms as early as possible to avoid any future confusion. These forms include the Wage and Tax Statements (Form W-2), the employer’s quarterly payroll tax return (Form 941), the Annual Return of Withheld Federal Income Tax (Form 945), and the annual federal unemployment tax return (Form 940 or 940EZ).
Step 3 – Check Your Reports
Before filing the forms, make sure that there are no mistakes. A mistake, even an honest one, can result in a difficult blow to your business in the form of an IRS-issued Trust Fund Recovery Penalty. This penalty requires you to pay 100 percent of whatever you should have originally paid, plus interest. You should do your best to pay payroll taxes as responsibly as possible to avoid this penalty.
