Post comments on your experience with any elements of payroll. Some items to answer:
- Do you receive a form 1099? Why should you receive a higher hourly rate than if you were issued a W-2 Form (this relates to the self-employment tax of 15.3% based on 7.65% as the withholding from the employee and the match paid by the employer as payroll taxes).
- W-2’s must be mailed to employees by January 31 each year. The employer must submit W-2 information to the government no later than February 28 each year. What are some the challenges doing this?
- If you work for a company and have the ability to sign checks, you may have a liability for unpaid payroll taxes. How comfortable are you with this responsibility?
- If you work for a company that is not properly submitting payroll taxes, this usually creates a legal and financial liability for the company but you can still claim full credit for withholding on your tax return. What do you think of this as a concern for small business owners and officers?
- At some point, you’ve probably have filled out a W-4. The W-4 was recently revised. View here: https://www.irs.gov/forms-pubs/about-form-w-4 and https://www.irs.gov/pub/irs-pdf/fw4.pdf and consider how you manage your Federal Tax withholding obligation. What are the financial consequences you need to think about as you complete the W-4?