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  • independent contractor taxes

    Independent Contractor Taxes: What You Need to Know

    posted by Kaylee Riley
    Newest Article
  • determine workweek and employee pay

    How to Determine a Workweek and Employee Pay

    posted by Kaylee Riley
    Recent Article
  • Independent Contractor Taxes: What You Need to Know

    Unlike employees, independent contractors do not have taxes taken out of their wages. Instead, you have to remit taxes yourselves.

    Forms and pre-work requirements

    Before you do any work, you may need to obtain a tax registration certificate (sometimes called a business license). Check with your city and county to find out if you need to register before you can begin operating your business. The certificate notes any local tax you will have to pay.

    How to Determine a Workweek and Employee Pay

    According to the U.S. Department of Labor, a workweek is a regularly recurring period of 168 hours (seven consecutive 24-hour periods). A workweek does not have to follow a standard calendar week. It can start on any day of the week and at any time, giving you flexibility to create a workweek that meets your business’s needs. For example, a workweek could start on Tuesday at 12 a.m. and end on Monday at 11:59 p.m.

    A workweek is a fixed period of time. It cannot be moved to avoid paying overtime, to accommodate large events, or for any other reason. However, you can change a workweek if it is intended to be permanent. You cannot frequently change the start of the workweek.

    You can create different workweeks for different employees, groups of employees, and business locations. This can be beneficial if their regular weekly tasks have different timelines. However, creating different workweeks could make your payroll more complicated.

    What Is a Pay Card?

    A pay card (or payroll card) is a prepaid card that an employer can use to pay their employees. Each payday, the card is loaded with the employee’s wages for that pay period. Employees can then use the pay card like a debit card, or they can withdraw their wages through an ATM, bank cashier, or a purchase where they receive cash back.

    Pay cards are often used as an alternative to paper checks or direct deposit.

    A 2012 study found that $34 billion was loaded on 4.6 million active pay cards, which is expected to grow to $68.9 billion loaded on 10.8 million cards by 2017.

    Pay Stub: What to Include and What to Understand

    It’s important to know how to read a pay stub. Understanding what items to include on a pay stub, and the meanings behind them, will help you to catch payroll errors and may prevent you from potentially costly mistakes. Or you may need to answer an employee’s questions about how they are paid.

    In addition to your employees’ basic information, a pay stub will have an itemized account of their salary or wages as well as any other additions to their pay. It will also list any taxes or deductions from their pay.

    What Is the New DOL Test to Identify Independent Contractors?

    The Wage and Hour Division of the U.S. Department of Labor (DOL) released an administrator’s interpretation on July 15, 2015, containing their new guidance on how to identify someone as an independent contractor.

    The DOL’s new guidelines to determine a worker’s status could mean big changes for some businesses. Workers that are classified as independent contractors are filed with Form 1099 and do not receive overtime pay or benefits. Also, the employer does not withhold any taxes from the worker’s pay. Workers that are classified as employees are filed with Form W-2, can receive benefits and overtime pay, and have taxes withheld from their pay.

    How to Pay Nonprofit Employees

    People often think that nonprofit organizations run off of volunteers, or if they do have employees, they are poorly paid. This is not always true.

    Many nonprofit organizations have employees and they are well compensated for their work. Nonprofits tend to attract and retain  top talent by giving their employees compensation that is similar or equal to for-profit organizations.

    The Basics of Payroll Tax Withholding

    Payroll tax withholding refers to an employer retaining part of an employee’s salary. The withheld amount is paid as tax directly to the IRS or other appropriate organization, like the Social Security Administration. Withholding lets the employee to pay taxes every month from each paycheck. Doing this reduces how much the employee might have to pay when they file their annual tax returns.

    The amount withheld is based on the employee’s income and other details, like exemptions, marital status and dependents. If the total amount withheld for the year is more than what the employee would have had to pay on their annual tax returns, the employee will get a tax refund.

    What Is California’s Sick Leave Law?

    The Healthy Workplace Healthy Family Act of 2014 (AB 1522), along with its amendments (AB 304), changed how employee sick leave works. Effective July 1, 2015, the law affects current employers and employees in regard to earned paid sick leave. There are a few exceptions to the law, but the majority of all employers in California will now need to give their employees mandatory paid sick leave.

    Do I Have to Pay Self-Employment Tax?

    Self-employment is part of the American dream for many. To do what you love and get paid for it can be incredibly rewarding if handled properly. However, one of the factors that needs to be considered is self-employment tax — which is a necessary evil when you are doing what you love!

    Benjamin Franklin, whose face graces the U.S. hundred-dollar bill, once said, “In this world nothing can be said to be certain, except death and taxes.” While taxes may be a certain part of doing business and working, you may not be so certain about how to properly account for those taxes if you are self-employed…

    What is Social Security Tax?

    Social security, officially called the Old-Age, Survivors, and Disability Insurance (OASDI), is a system designed to help support those who are no longer able to work due to old age. It also supports widows/widowers and those who are disabled. To fund social security payments, every employee, employer, and self-employed person in the U.S. is required to pay social security tax. This tax is automatically withheld from every paycheck issued by an employer. It’s the employer’s job to make certain that the tax is remitted to the appropriate agency at the correct time.

    Independent Contractor Taxes: What You Need to Know

    Unlike employees, independent contractors do not have taxes taken out of their wages. Instead, you have to remit taxes yourselves.

    Forms and pre-work requirements

    Before you do any work, you may need to obtain a tax registration certificate (sometimes called a business license). Check with your city and county to find out if you need to register before you can begin operating your business. The certificate notes any local tax you will have to pay.

    How to Determine a Workweek and Employee Pay

    According to the U.S. Department of Labor, a workweek is a regularly recurring period of 168 hours (seven consecutive 24-hour periods). A workweek does not have to follow a standard calendar week. It can start on any day of the week and at any time, giving you flexibility to create a workweek that meets your business’s needs. For example, a workweek could start on Tuesday at 12 a.m. and end on Monday at 11:59 p.m.

    A workweek is a fixed period of time. It cannot be moved to avoid paying overtime, to accommodate large events, or for any other reason. However, you can change a workweek if it is intended to be permanent. You cannot frequently change the start of the workweek.

    You can create different workweeks for different employees, groups of employees, and business locations. This can be beneficial if their regular weekly tasks have different timelines. However, creating different workweeks could make your payroll more complicated.

    What Is a Pay Card?

    A pay card (or payroll card) is a prepaid card that an employer can use to pay their employees. Each payday, the card is loaded with the employee’s wages for that pay period. Employees can then use the pay card like a debit card, or they can withdraw their wages through an ATM, bank cashier, or a purchase where they receive cash back.

    Pay cards are often used as an alternative to paper checks or direct deposit.

    A 2012 study found that $34 billion was loaded on 4.6 million active pay cards, which is expected to grow to $68.9 billion loaded on 10.8 million cards by 2017.

    Pay Stub: What to Include and What to Understand

    It’s important to know how to read a pay stub. Understanding what items to include on a pay stub, and the meanings behind them, will help you to catch payroll errors and may prevent you from potentially costly mistakes. Or you may need to answer an employee’s questions about how they are paid.

    In addition to your employees’ basic information, a pay stub will have an itemized account of their salary or wages as well as any other additions to their pay. It will also list any taxes or deductions from their pay.

    What Is the New DOL Test to Identify Independent Contractors?

    The Wage and Hour Division of the U.S. Department of Labor (DOL) released an administrator’s interpretation on July 15, 2015, containing their new guidance on how to identify someone as an independent contractor.

    The DOL’s new guidelines to determine a worker’s status could mean big changes for some businesses. Workers that are classified as independent contractors are filed with Form 1099 and do not receive overtime pay or benefits. Also, the employer does not withhold any taxes from the worker’s pay. Workers that are classified as employees are filed with Form W-2, can receive benefits and overtime pay, and have taxes withheld from their pay.

    How to Pay Nonprofit Employees

    People often think that nonprofit organizations run off of volunteers, or if they do have employees, they are poorly paid. This is not always true.

    Many nonprofit organizations have employees and they are well compensated for their work. Nonprofits tend to attract and retain  top talent by giving their employees compensation that is similar or equal to for-profit organizations.

    The Basics of Payroll Tax Withholding

    Payroll tax withholding refers to an employer retaining part of an employee’s salary. The withheld amount is paid as tax directly to the IRS or other appropriate organization, like the Social Security Administration. Withholding lets the employee to pay taxes every month from each paycheck. Doing this reduces how much the employee might have to pay when they file their annual tax returns.

    The amount withheld is based on the employee’s income and other details, like exemptions, marital status and dependents. If the total amount withheld for the year is more than what the employee would have had to pay on their annual tax returns, the employee will get a tax refund.

    What Is California’s Sick Leave Law?

    The Healthy Workplace Healthy Family Act of 2014 (AB 1522), along with its amendments (AB 304), changed how employee sick leave works. Effective July 1, 2015, the law affects current employers and employees in regard to earned paid sick leave. There are a few exceptions to the law, but the majority of all employers in California will now need to give their employees mandatory paid sick leave.

    Do I Have to Pay Self-Employment Tax?

    Self-employment is part of the American dream for many. To do what you love and get paid for it can be incredibly rewarding if handled properly. However, one of the factors that needs to be considered is self-employment tax — which is a necessary evil when you are doing what you love!

    Benjamin Franklin, whose face graces the U.S. hundred-dollar bill, once said, “In this world nothing can be said to be certain, except death and taxes.” While taxes may be a certain part of doing business and working, you may not be so certain about how to properly account for those taxes if you are self-employed…

    What is Social Security Tax?

    Social security, officially called the Old-Age, Survivors, and Disability Insurance (OASDI), is a system designed to help support those who are no longer able to work due to old age. It also supports widows/widowers and those who are disabled. To fund social security payments, every employee, employer, and self-employed person in the U.S. is required to pay social security tax. This tax is automatically withheld from every paycheck issued by an employer. It’s the employer’s job to make certain that the tax is remitted to the appropriate agency at the correct time.