Every small business needs a CPA on retainer. Finances make or break businesses so it’s wise to be in step with the law. Small Business Tax Services in Manhattan New York come in and make sure businesses are set up properly. Most businesses are entities like corporations or limited liability corporations. However, the accountant may think it’s better to be an S corporation.
Should You Incorporate?
Corporations help employers separate their assets from those of the business. There are different corporate structures and a CPA advises owners what works for them. For instance, corporate owners are personally exempt from some debts if a business folds. In addition, owners file business and personal tax returns. However, S corporations merge business and personal earnings into one tax return.
The best plan is to use an accountant when the business is first established. They look at the situation and figure out what structure will be more tax-friendly. Finally, they will prepare and file annual tax returns with the federal and state governments. Best of all, a CPA is prepared to help clients with any tax audits.
Making Payroll Can Be Tricky
Employers must withhold taxes from employee earnings. However, it’s not always easy to figure out how much to withhold. First, social security tax and Medicare must be withheld and employers match the employees’ contribution. Employees pay different rates so this makes it helpful to have Small Business Tax Services in Manhattan New York. They figure out all the calculations for the employer.
Employers also pay federal and state unemployment taxes. Federal unemployment taxes (FUTA) are not withheld from the employee. Likewise, employers must pay state unemployment taxes on a quarterly basis. Once again, this amount is not uniform for all employees.
Accounting Services save Money
The penalties for not paying the correct amount of tax are steep. Further, there are penalties for paying employment taxes late. Having an expert on board only makes sense. Not all employees make the same amount of money. Hence, accountants figure out salaries and print the checks.
Finally, accountants tell clients when to deposit employee withholdings. Generally, withholdings are deposited on a monthly or semi-weekly basis. FUTA taxes must be paid for any quarter where the tax due is more than $500. For more information, contact us.