As a new calendar year begins, now is a great time to review opportunities regarding your payroll.
The latest version of the W-4s has not changed since 2020, but taxpayers may want to adjust their withholding if their return has a large refund or balance due. Other reasons to fill out a new W-4 are marriage or divorce, the birth of a child, multiple jobs, a new business, or other changes in income. IRS.gov has a withholding calculator to help you decide if there are any other needs to be withheld from a paycheck.
The beginning of the year is a great time to start planning for payroll tax deposits. The penalties for not having sufficient funds paid during the month or year can be large. Employers need to ensure they are correct in anticipating the payroll tax deposits that need to be paid in advance to avoid penalties when they expect to increase the number of employees during the year.
As we wrap up 2021, business owners need to review information return (1099-MISC or 1099- NEC, etc.) rules because these forms are due soon. You will need to file with IRS and the State if you have paid at least $600 in the course of business for the year for the following: rent, medical and health care, services performed by someone who is not an employee, and payments to an attorney for legal services, or any other payments. **Note, if a business has an 'LLC or LLP' in it, this does NOT mean they are or are not a corporation. Since you generally do not have to issue a 1099 to a corporation, you need to ask the LLC or LLP how they are taxed.
Payroll and year-end reporting can be overwhelming and time-consuming. When you hire us to serve you, we take that burden off your shoulders and give you time back.
Call Schaffner Tax Solutions LLC today! (608) 820-3200
Comments