Avoiding these penalties starts with knowing the common mistakes other businesses have made.
1. Setting up Payroll Incorrectly
Unfortunately, this is easy to do. It is important to register a business before setting up payroll in order to ensure federal, state, and local tax withholdings are accurate and the employees are classified properly. Even if wages were calculated perfectly and payroll was done on time, these errors can lead to penalties with the IRS.
2. Late or Incorrect Deposits
Even if payroll is processed correctly, it is important to know when to pay the taxes. Business owners should learn how often taxes should be deposited to avoid penalties. This is based on the business's tax liabilities. Rules can include whether electronic deposit is an option and when the deposit needs to be processed.
3. Not Updating the State Unemployment Insurance Rate
If the business receives a new SUI rate from the state agency, it is up to the business to add the new rate to the payroll system. Failure to do so will result in fines.
Small businesses do not need to be a statistic. These mistakes can be avoided by outsourcing the payroll processing to a certified payroll bureau. Payroll NW has been in business for 36 years and is qualified to process in all 50 states. Contact us today for more information.