Funny thing, kinda related to jd sellers post

JayinNY · Jan 2, 2015

I just got a letter from the IRS today stating that I never filed form 941 so I looked into it and I realized it was because my brother is no longer on my books we now subcontract from each other, when he was on the books for me I was paying employee payroll taxes from $150-$200 a week, his salery and workman's comp, plus a payroll service! the state penalize you for providing another person with a job. Absolutely ridiculous I'm so glad I don't have to pay him on the books anymore the payroll tax was actually more than my mortgage per month. Worst part is I paid that for 13 years I have no idea were the employee withholding tax goes to, I guess just to the state. They say the problem with New York State is the public sector is supporting the private sector. I guess if I became a state employee I would've had it made! Lol. When I got that letter it made me think of JD sellers post about having to buy insurance, I guess the money I save on payroll tax can go towards my health insurance!

Dave H (MI) · Jan 2, 2015

Just to be clear, the total savings may not be as much as you think. Withholding from payroll consists of income taxes and FICA taxes (SS & Medicare). As an employer you matched his FICA taxes and as a subcontractor he pays the whole load less a few points on his personal tax return. So the taxes are pretty much the same except for unemployment agency taxes. So you save those and you save the payroll service and you save on WC insurance. Still cheaper the way you are doing it now. HTH, Dave H CPA (MI)

NEKS · Jan 2, 2015

I had employees for 23 years, but had a friend that had a small business and his CPA told him that you never want to get big enough where you have to hire help. Then it really starts costing you.

Funny thing, kinda related to jd sellers post

JayinNY

Well-known Member

Dave H (MI)

Well-known Member

NEKS

Well-known Member

Similar threads