| April 15 is not the only critical tax deadline. If you are a | | | | employee each year. So the most you pay for any |
| small business owner with employees or independent | | | | one employee is $56, assuming the employee had at |
| contractors, January 31 is an important tax deadline | | | | least $7,000 in wages. |
| you cannot afford to ignore. | | | | The Form 940 is only filed annually. But the 940 tax |
| The end of January is the due date for several | | | | must be paid at the end of any quarter in which the |
| payroll-related tax forms and tax payments. Before | | | | unemployment tax liability reaches $500. So you should |
| reviewing them, here's some good news. Whenever a | | | | be calculating the tax every quarter to see what your |
| federal tax deadline falls on a Saturday, Sunday or | | | | liability is. If it reaches $500, make a payment by the |
| legal holiday, the due date is automatically moved to | | | | end of the month following the end of the quarter. If it's |
| the next business day. | | | | less than $500, you carry over the liability to the next |
| Since January 31, 2009 is a Saturday, the due date | | | | quarter. |
| has been extended to Monday, February 2, 2009. | | | | Most small businesses that have fewer than 10 |
| (Perhaps those two extra days will come in handy!) | | | | employees usually don't have to make a federal |
| Also keep in mind that to comply with any federal tax | | | | unemployment tax payment for quarters 1, 2 or 3. But |
| deadline, your mailing must be postmarked on or | | | | when the 4th quarter rolls around you will have to pay |
| before the due date. | | | | the entire annual tax liability. If your total annual tax is |
| Here are the key federal payroll forms and tax | | | | $500 or less, you can pay it with the Form 940 (be |
| payments due on February 2, 2009: | | | | sure to include voucher Form 940-V). If the tax is |
| 1. Form 941, Employer's Quarterly Federal Tax Return. | | | | more than $500, you must pay the tax at your local |
| This is the form used to report all employee | | | | bank or via the IRS electronic payment system |
| compensation (wages, salaries, commissions, bonuses, | | | | (EFTPS). |
| etc) during the fourth quarter, as well as federal | | | | 3. Form W-2, Wage and Tax Statement. |
| income tax withholdings, social security taxes and | | | | You must give or mail W-2's to all your employees no |
| medicare taxes (both the employee's withholding | | | | later than February 2, 2009. Employers must include |
| amount and the employer's match). | | | | Copy B, Copy C and Copy 2 along with the |
| If the quarter's total tax (as shown on Line 10) is more | | | | Instructions for Employee. In addition, you must send a |
| than $2,500, then you should have been making payroll | | | | copy of all W-2's to the Social Security Administration |
| tax payments during the quarter according to the IRS | | | | by March 2, 2009, along with Form W-3, Transmittal of |
| payroll tax payment requirements. (See IRS Publication | | | | Wage and Tax Statements. |
| 15 for details on that.) | | | | 4. Form 1099-MISC, Miscellaneous Income. |
| But if the quarter's total tax is less than $2,500, you | | | | The most common use of this form is to report total |
| can pay your entire quarterly payroll tax liability with | | | | annual payments to independent contractors (sole |
| Form 941. Just be sure to include voucher Form 941-V | | | | proprietors who provided services to your business) of |
| with the return and make your check payable to the | | | | $600 or more. You must send Copy B of the |
| U.S. Treasury. | | | | 1099-MISC to the recipient by February 2, 2009. And |
| 2. Form 940, Employer's Annual Federal | | | | you must also send Copy A to the IRS by March 2, |
| Unemployment (FUTA) Tax Return. | | | | 2009, along with Form 1096. |
| This is the form used to report federal unemployment | | | | Important: Your state probably has payroll tax forms |
| tax, which employers' must pay (i.e. out of your own | | | | and payments due on January 31 or February 2, so be |
| pocket) on behalf of each employee. The tax is | | | | sure to check with your state's tax department for |
| typically 0.8% of the first $7,000 in wages paid to each | | | | details. |