I have recently been handed over the payroll tax duties in the family business due to a falling out. I was wondering, I have never really understood the withholding tax percentages etc. what would be the best way to calculate payroll withholding tax without hiring in an accountant.
2007-10-27 18:01:37 · 4 answers · asked by ahlandel 1 in Business & Finance ➔ Taxes ➔ United States
www.paycheckcity.com
It is accurate.
Just to test it, I typed my salary along with my W4 allowances and my 401k and it calculated my net pay to the penny.
2007-10-27 18:07:06 · answer #1 · answered by Wayne Z 7 · 1⤊ 0⤋
The answers you are looking for are in the following pubs and instructions.
Pub 15
Pub 15a
Pub 15b
Instructions form 940
Instructions form 941
http://www.irs.gov/pub/irs-pdf/p15.pdf
http://www.irs.gov/pub/irs-pdf/p15a.pdf
http://www.irs.gov/pub/irs-pdf/p15b.pdf
http://www.irs.gov/pub/irs-pdf/i940.pdf
http://www.irs.gov/pub/irs-pdf/i941.pdf
The link for the 940 is from 2006, the 2007 instructions aren’t out yet but will probably be released in December.
The 941 for 2007 3rd quarter is due on 10/31/07, if it is late there will be a late filing penalty and interest. Since you are so close to the due date of the return person who was handling the payroll taxes should file this quarter and you take over 4th quarter.
As another poster stated the IRS doesn't mess around with payroll taxes.
If your business is big enough to have employees then you probably are using accounting software to do your books. If you are see if your program has a payroll module, and buy it. Some programs have one built into it, my version of quickbooks does.
You could always call 800-829-1040 for help if you get stuck. But a better idea for the long term would be to see if you can take a course by H&R Block or your community collage; or hire a CPA or EA to teach you.
2007-10-28 09:05:05 · answer #2 · answered by Charlie & Angie G 4 · 0⤊ 0⤋
While sites like paycheckcity.com are pretty handy and accurate for figuring the withholding amounts, the filing of the payroll returns and deposits of the payroll taxes are complex and have strict deadlines. I would STRONGLY urge you to get a few hours of consultation time with a CPA to get yourself on track. The penalties for one late filing or deposit could easily exceed the cost of a few hours of a CPA's time to make sure that you have everything down pat.
Payroll taxes are NOT something to mess around with. You can be held PERSONALLY responsibe for errors or failure to make deposits on time. A good CPA will drill that home for you and make sure that you know what you are doing and that you do it properly. While the IRS will dicker on income taxes and give you time to sort things out, they will NOT mess around with public trust fund items like payroll taxes!
I'm a bit surprised by the responses by the other posters. They know what they're doing quite well, but they missed the boat on this one!
2007-10-28 03:07:17 · answer #3 · answered by Bostonian In MO 7 · 0⤊ 0⤋
I know a good site: www.paycheckcity.com.
First you need to register, no charges. It has many useful calculators. If you want to find out what your pay check will be then you can use this link:
http://www.paycheckcity.com/netpaycalcreg/netpaycalculator.asp
First select the year and State and then enter your income and deduction info.
2007-10-28 01:19:30 · answer #4 · answered by MukatA 6 · 0⤊ 0⤋