According to the Small Business Administration, nearly 80% of ALL small businesses fail inside of five years.
That number is pretty sobering all on its own, but what the SBA doesn’t tell you is that there are a lot of small business owners that not only fail and have to close up shop for good, but that actually end up going to prison as well!
Yes, you’re reading that correctly – a pretty significant chunk of small business owners in the United States end up going to prison within the first five years of opening their business. And it has absolutely NOTHING to do with shady businesses, illegal sales, or swindling customers.
No, instead has absolutely EVERYTHING to do with mishandling your payroll taxes – something the federal government and the IRS take very, very seriously.
You need to make sure you are doing absolutely everything you can to avoid making these mistakes or end up paying a significant finding and penalty or potentially even doing some jail time. Pay attention to the inside information below to avoid some pretty scary situations.
Make deposits on time
The IRS has established two different schedules that you can choose to forward with when it comes to depositing the different types of payroll tax you are legally required to collect. You can go with monthly deposits or semiweekly deposits and these figures are based off of the total tax liability you have reported on Form 941.
Federal and State unemployment taxes should be addressed correctly
As a small business owner, you have to report and pay both federal and state unemployment tax (FUTA and SUTA), but you have to make sure that you are paying exactly the right amount and that you are also paying these taxes before critical deadlines.
This is the kind of information you need to go over with your CPA about (this is the information you’ll find on Form 940, your Federal Unemployment Tax Return) or you run the risk of getting into some very sticky situations.
If you need to make sure that you are in full compliance with all of you payroll tax issues, or even if you just want someone to double check that you are in the clear, contact us here at Complete Tax and Notary Services and we will be able to assist you every step of the way.
We look forward to hearing from you soon!