Instant Tax Solutions Discusses Responsibilities of Business Owners to Pay Payroll Taxes
When it comes to understanding the tax system, Byron Pedersen of Instant Tax Solutions is becoming widely respected. Instant Tax Solutions understands in depth what it means for businesses to handle payroll taxes. Recently Byron Pedersen sat down to discuss the responsibilities of a business owner in handling payroll taxes.
First off, thank you Byron Pedersen for your time today.
The pleasure is mine.
Let’s start with a little background.
From what we read, Instant Tax Solutions started with three or four people. And in a very short time, Instant Tax Solutions grew to how many employees?
Yes, we started with four people in a single room. Today we have over forty tax professionals.
Define what you mean by tax professionals.
A tax professional is a tax attorney, former IRS agent, or an individual who has worked with tax relief groups similar to ours, and so on. In short, someone with vast experience in working with the IRS is a tax professional.
To what do you attribute the growth?
Well, when we started in that room with just four people, we had written a code of honor. We had a value system that said we would always function with integrity and always put first the taxpayer seeking our help. I believe that has truly paid off.
With that said, let’s talk about payroll taxes.
Well, payroll taxes cover Social Security, Medicare, and Federal taxes that a business withholds from an employee’s pay check. Businesses, by law, are required to match Social Security and Medicare taxes. And they have to pay unemployment taxes on each employee as well.
Can you give us a brief synopsis of the process a business must go through in handling payroll taxes?
I can. First off, every employee when hired must fill out a W-4 form.
And I am assuming that the business has to keep that on file.
You are correct. This form helps determine the amount of tax to be withheld from the employee’s check. As well, many states use this Federal form to determine the amount of taxes to be withheld for state tax.
Before we continue, I keep seeing the acronym FICA. What is that?
FICA stands for Federal Insurance Contributions Act and it encompasses what I mentioned earlier – Medicare and Social Security. This provides federal funds, tax dollars, for retirees, the disabled, and the minor child of a decedent.
So we have a form, and from that form the tax amount per employee is determined. What else is important?
An EIN number.
What does an EIN number do?
An EIN number allows the federal government to track a business. By law a business must establish an EIN number.
When does a business establish this number?
Byron Pedersen/Instant Tax Solutions: Before establishing the business or even hiring one employee. And this will allow the government to make sure said business is paying their payroll taxes.
And when are payroll taxes required to be paid?
It can vary and is based on the entire amount of the payroll. It can be weekly, bi-weekly, monthly, or quarterly.
And is that it?
Far from it. Actually, there are four different forms that a business owner must complete.
As we conclude, if this gets confusing…
The business should hire a tax attorney. Better to be clear in understanding than try and cry ignorance later.
Byron Pedersen is the co-founder of Instant Tax Solutions. Instant Tax Solutions is a tax relief organization helping individuals and businesses dealing with a wide range of tax issues. Instant Tax Solutions believes that the taxpayer, not the relief organization, should come first. Instant Tax Solutions can be found online at http://instanttaxsolutions.com
Instant Tax Solutions was birthed out of a vision to join expert tax relief services with an absolute commitment to integrity. Instant Tax Solutions partners Byron Pedersen and Ian Woodman were also committed to the goal of offering reassurance and hope to every client. The two founders of Instant Tax Solutions vowed to offer each potential client a free consultation that would include a financial analysis and a plan for resolving tax debt. The Instant Tax Solutions partners also resolved that any person not qualifying for IRS tax relief would be advised at no charge.
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