This promotion is for Rewards members only. To take advantage of exclusive offers like these, join Office Depot® OfficeMax® Rewards now!
Take a moment to think back to the day you received your first real paycheck. If you're like many of us, you may recall experiencing some shock upon noticing that the check amount was much less than your actual salary.
A quick glance at the accompanying pay stub alerted you to the fact that your employer had reduced your pay by a number of deductions, the most significant of which were probably the amounts for federal and state taxes. As you're now aware, your employer was withholding from your check the various taxes that you, as a wage earner, had to pay.
When you become an employer, you too will have to withhold taxes from your employees' pay and to deposit the withheld amounts with the appropriate tax agencies. Furthermore, as an employer, you will also have to pay certain taxes based on the amounts that you pay your workers.
Together, those taxes that you're required to withhold and those that you're directly required to pay comprise your payroll taxes. They may include federal, state, and perhaps local income taxes, Social Security and Medicare taxes, federal and state unemployment taxes, and, in some states, disability insurance taxes. And, regardless of whether you employ others, you can also expect to owe some payroll-type taxes on income that you receive from your business.
The key to controlling your payroll tax obligations is making all your payments when they're due, so you avoid getting hit with costly penalties. Toward this end, we'll help you stay on top of the rules by leading you through the following topics:
- Who are your "taxable" workers? presents the first step in calculating your payroll taxes: determining which of your workers are "employees" on whom payroll taxes are due. Among the issues we'll examine are the distinction between employees and independent contractors and the potential tax benefits in hiring your children.
- What compensation is taxable? presents the second step in the process: determining which forms of employee compensation are taxable in addition to basic wages and salaries. We'll provide the information you'll need to deal with such items as tips, expense reimbursements, fringe benefits, and noncash payments.
- Which payroll taxes apply? introduces you to the third step: knowing the various types of tax obligations that arise when you have employees, and knowing how to compute the amounts that must be paid.
- Payroll tax returns and payments informs you of the dates you should have marked on your calendar, and discusses the forms and procedures you must use in paying your taxes. We'll also cover the penalties you'll avoid by being timely with your returns and payments.
- What are your self-employment taxes? discusses the payroll-type taxes a business owner is required to pay on the income drawn from the business.