The Internal Revenue Service (IRS) website offers several resources to assist new and small business owners with information needed to understand and meet federal tax obligations. Tutorials are available on-line and are conveniently labeled for easy accessibility anytime.
In this section, the IRS provides information on your responsibilities as an employer, or as one who pays others for services in the course of your trade or business. It is critical that business owners correctly determine whether the individuals providing services are employees or independent contractors. Generally, you must withhold income taxes, withhold Social Security and Medicare taxes, and pay unemployment tax on wages paid to an employee.
You don not generally have to withhold or pay taxes on payments to independent contractors unless you are provided with a required taxpayer identification number or are instructed to withhold by the Internally Revenue Service.
The IRS provides guidance on these tax requirements as well as worker classification.
The IRS “Federal Taxes When Hiring Employees or Federal Contractors” resource provides details on:
- Behavioral Control
- Financial Control
- Relationship with Worker
- Determining Worker Status
- Employer Responsibilities
- Determining Eligibility of Employees to Work Legally in the United States
- Form W-4
- Verification of Employee SSNs
- Form W-2 Wage and Tax Statement
- Ensuring New Employees Provide Correct Information
- And more
The IRS website for businesses also provides resources for understanding business expenses, business income, taxes and more. It’s easy to use, provides the most current and accurate information, and is updated frequently to help new and small business owners with the information needed to meet federal tax obligations.
Our experienced HR experts can help assess worker classification. Contact us today for a complimentary consultation and learn more about how we’re helping businesses ensure proper worker classification.
As an experienced payroll partner, Southland Data Processing also offers support to help keep payroll processing organized, compliant and accurate. Clients can expect to have access to a variety of resources, training and educational webinars to stay current with the latest news and information.
Our payroll professionals assist our clients with payroll, workforce management, benefits administration, and human resources needs. To get started or learn more about these solutions, simply contact us today.
We also invite you to meet with us today for a complimentary HR consultation and to learn how we can support objectives, overcome challenges, and address issues quickly and accurately.
For more information about our payroll services, please contact our payroll professionals at 909.946.2032. Or, click here and Let’s Talk!
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*Southland Data Processing, Inc. (“SDP”) is not a law firm. This article is intended for informational purposes only and should not be relied upon in reaching a conclusion in a particular area of law. Applicability of the legal principles discussed may differ substantially in individual situations. Receipt of this or any other SDP materials does not create an attorney-client relationship. SDP is not responsible for any inadvertent errors that may occur in the publishing process.