Whatever your business - if you have employees, you have employment taxes. For each hire, you are required to withhold the employee's federal income tax, FICA, Medicare, along with state income tax and state disability insurance in most states. As the employer, it is your responsibility to make sure these taxes are deposited to the government. Employee taxes are held in trust funds to be deposited by the employer using Form 941.
It's also the employer's duty to match the employee’s FICA and Medicare contribution amounts. All funds are deposited with the US Treasury Department through electronic funds transfer. The schedule of the deposits is dependent on the amount of the liability. Each quarter the taxes are reported to the IRS via the Form 941.Your company must also pay into the federal and state unemployment funds. The federal rates depend on how much the employee’s pay is each year. Also, each state has different requirements and rates for unemployment taxes.
Failure to deposit taxes on time or mistakes in reporting taxes results in penalties levied by the IRS. It’s very important for companies to be on top of all aspects of their payroll or things can get expensive. If you have questions about your taxes or any employee administration concerns, contact People Lease today at (601) 987-3025.
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