Business Start-Up Assistance Relating to Payroll
Starting a business can be a daunting task. Luckily, we’re here to help. The information below is intended as a helpful resource toward the start-up of any new business. Where appropriate, we have recommended some of our trusted business partners to assist in minimizing your risk, and provide important information.
I. Research & Business Plan
- Consult with a local accountant and attorney before starting your business.
Recommendations:
- Kram, McCarthy, Ayers & Frost, LLC – Accounting Services
- States have specific requirements for businesses. It is beneficial to consult with an accountant and attorney before you get started. Due to taxes and penalties that can accrue, it is worth the investment of consulting with professionals.
II. Registrations
- State License – Every state has specific requirements for different trades. Review the state’s website or contact the department of labor in the state in which you will be working to inquire about the mandates for a license to work in that state.
- Employer Identification Number or “EIN”
- An EIN is a federal tax identification number needed to establish your business as an entity.
- SS-4 Form is the registration form to obtain an EIN. The form can be downloaded or filed on line at www.irs.gov.
- In most cases, other businesses you work for as a subcontractor will require you to have an EIN for tax purposes.
- State Withholding Account Number
- If you will be processing payroll, you will need to register with your state government for a withholding account.
- Most states have on-line registrations available for establishing an withholding account. If not, most have a pdf-formatted form to print out.
- State withholding tax needs to be deducted from your employees’ paychecks then remitted to that state. Every state has different filing deadlines. Once you have registered, the state will let you know your depository frequency.
- State Unemployment Account Number
- Employees must be covered under unemployment insurance in the state in which they work.
- Most states have on-line applications for establishing an unemployment insurance account. You will want to search under “Department of Labor” or “Employment Commission” for that state.
- Typically, quarterly forms need to be produced and filed with the state for unemployment insurance. Unemployment is an expense only to the employer. Each state will give you a percentage rate on gross wages that needs to be contributed until the maximum has been met for each employee.
III. Payroll
- Payroll is a vital task to any business. It is important to keep good records because federal, state and unemployment taxes have to be paid on specific guidelines issued by each entity. Therefore, if you make your tax payments late or don’t file returns, etc.…hefty penalties and interest typically will accrue.
- Advanced Payroll Solutions, Inc. will process everything from paychecks to returns.
- The cost involved in having a third party process payroll is minimal compared to the cost involved in having to pay an employee to process the payroll.
- Advanced Payroll Solutions, Inc. does not impound money from your payroll account like other services. We have no access to your bank account to withdraw funds. We do electronically file your taxes with both state and federal agencies but that money comes out when it is due and by that particular government agency.
For additional information or assistance with legal and/or administrative tasks involved in the startup of your new business, please contact the experts at Advanced Payroll Solutions, Inc.