Hmm, Who Knew?

Ok, well I'm sure a CPA would know but let's file this blog note under "Lessons Learned."

I'd been fearful to hire employees due to the associated tax and payroll headaches that come along with them. I subsequently found a great payroll service that I can afford who takes care of 95% of the stuff for me. However, in going through my records this morning I realized that the 5% they don't take care of is monthly federal tax deposit I'm required to make. Um yeah, my employee started back in April so that means I've been delinquent on the May and the June payment (due the 15th of each month). Oops!

A frantic call to the payroll service and I'm told to take a check down to my bank with the "yellow deposit coupons you got from your bank" and make the deposit via them. As for the fact that the payment is late, well the IRS may or may not come after me for that.

Turns out that's not quite right. First of all, no yellow deposit coupons from the bank but the bank tells me to go to the library which I do and find no tax deposit coupons who then tells me to go to Office Max which once again I do to find no tax deposit coupons. At wits end and starving because I haven't yet had breakfast (which makes me very very cranky) I finally head home and check out the irs.gov website because can't you just download everything these days?

Turns out that you can't download the form I need (which apparently is a Form 8109) but you can call up the IRS and they will kindly send you the form in 4-6 weeks. At the same time though I also learned that if you estimate your federal payroll taxes to be less than $2500 for the quarter then you can actually simply pay in full when you submit your quarterly payroll tax form (Form 941). So I've ordered up the Form 8109 which will show up in a few weeks and in the meantime have an email into my payroll company to confirm that I can simply pay all the associated payroll taxes at once. I'm hoping that I can but worst comes to worst I can apparently just e-deposit the money owed. Since I am thinking I'll be under the $2500 mark I am happy to report though that I shouldn't get penalized for the fact my payments thus far are late.

Course that's all based on my understanding of the tax law which is, at best, very very shaky. Here's hoping I'm right!

It's pretty much turning into a tax day though since last night my husband and I realized we overpaid our county taxes (oops - but better then underpaid!) so I spent this morning figuring out how we can get a refund (apparently they'll just apply the overpayment to the second half of the year payment so we won't owe anything in October). Ahh - taxes...what fun!