make a good business better

Blog Employment Partners

Print Divider Print Divider Branding

Tips For Effectively Managing Payroll



Social Logo Social Logo Social Logo Social Logo

There's More to Payroll Processing Than You Think

With any business, employers must consider many factors when it comes to payroll. There's social security tax, medicare tax, unemployment tax (state and federal), paid holidays, and insurance to account for. If you don't stay on top of these taxes, you can incur hefty penalties from the IRS.

Tips on Managing Payroll Taxes for Your Business

  • Get your employees squared away with tax regulations across the board. Tax accounts must be made for each employee on federal, state, and local levels. Make sure the necessary forms for each tax agency are filled out correctly
  • Stay on top of employee status, and how they are paid. Are they full-time, part-time, contractors, or interns, and are they salaried or paid hourly? Make sure they're properly classified.
  • Keep track of everything. Hold on to employee's W-2, W-4 and other tax forms (some laws may require you hang on to some of these for a period of time).
  • Hit your deadlines. The IRS takes payroll taxes seriously, and they're not afraid to penalize small businesses that don't pay payroll taxes on time. Late-payment financial penalties increase the longer you neglect to pay. Even worse, the IRS can levy your bank account and seize your property.
  • Take immediate action if you're late with a payroll tax payment. Pay ASAP if you're late (the fines only increase over time). If you truly don't think you can afford to pay the taxes and the penalties you're incurring, make an Offer in Compromise with the IRS. This is a way to settle your tax debt for less than your owe, if the IRS determines that you qualify.
  • Make a federal tax deposit every pay period. There's no penalty for paying taxes early and often. And you won't feel the financial hit as much as you might if you wait until tax deadlines.
  • Maintain a separate bank account for all your payroll expenses (both the payroll itself and the taxes you'll pay). You'll be less tempted to borrow from payroll taxes to cover other business expenses, even if they're significant ones, like the building lease.

Most small business owners aren't tax code experts, and mid-to-large businesses have more employees to keep track of. There aren't often enough hours in the work week to handle payroll issues and taxes, so letting a third-party handle it is often wise.

LBMC Employment Partners offers full payroll processing services. We'll ensure that your employees are classified correctly, and that all your payroll tax payments are on time. If you have any payroll questions, LBMC Employment Partners is there for you business with our payroll processing service line. Our financial experts will help you navigate the complexities of payroll in a timely manner. You'll never have to worry about missing payment deadlines or filing taxes incorrectly for your business.

Posted in: Payroll