Do you have a lot of medical bills that you pay on each month? Could those medical bills be deducted from your tax bill this year? I was helping my mother take care of all of her finances after my dad passed away. I didn't realize how many bills she had coming in each month for medical treatments that my dad had undergone months, even a year earlier. I started doing some research about medical bills and tax deductions. If you have medical bills, take a minute to read through this blog to gain some knowledge that can help you decide what you can do when tax time comes around.
As a new business owner, there are numerous tasks that you are going to have to take on. One of these is payroll processing. Upfront, this seems like an easy and straightforward business task. However, there are a number of mistakes that you could make, especially if you aren't an accounting professional. Plus, when you throw in the fact that you are busy running your business, you could make a critical error and lead to financial woes and damage your reputation in the process. With that being said, here are three payroll processing mistakes that new business owners often make and how you might be able to avoid them:
1. Under- or Over-Payments
It is possible to pay your employees the wrong amount. The reason for the under- or over-payment could be due to the wrong payment amount being entered into the system incorrectly from the get-go, or the wrong number of hours worked were reported. All employee information should be double-checked prior to the processing of payroll to ensure that payroll errors are kept to a minimum.
2. Failing to Process Payroll on Time or Not at All
Running your own business is very time-consuming. However, you cannot let payroll slide. Your employees expect to be paid on the day that they are supposed to be paid on. If you fail to pay them on their payday, it can lead to very dissatisfied employees and costly mistakes. Not only could you under- or over-pay an employee as mentioned above, but you will likely find yourself spending extra time correcting errors and possibly even having to pay fines. A payroll service can be hired to help keep processing on schedule.
Also, keep in mind that you will have to issue final checks to employees that have been fired or quit. Each state has different laws regarding the timeframe in which these checks must be issued, so it is important that you are aware of these laws so that you can issue these checks in a timely manner.
3. Failing to Pay IRS Tax Payments on Time
As a business, you are required to make tax deposits to the IRS on a regular basis. According to the IRS, you can do this semi-weekly or monthly. If you fail to make your deposits, you could face up to a 15 percent failure-to-deposit penalty. It can help to set a reminder on your calendar for the due date of these deposits. Otherwise, if you want to outsource, a payroll service can help to ensure that these tax payments are properly and timely withheld, reported and paid.
If you think that you are in over your head when it comes to payroll, hire a payroll service to handle your company's payroll.Share