Monthly you may have to deposit federal and state withholding taxes. Federal rules state you need to deposit monthly if the total employee deducted and employer tax due is more than $2,500 total in a quarter. Review the rules for depositing funds carefully. If not paid according to the rules, penalties and interest apply to any late payments.
Payments will need to be made electronically on the EFTPS system. Enrollment into the EFTPS system is on-line and will include your name, address, federal id, and bank information. After you enroll, you will receive confirmation by mail with a PIN number. You will need this PIN number to get a password, which you need prior to making a payment. Therefore, you need to apply immediately so you don’t run into problems when the payment is due.
Federal and State Quarterly Reporting
Federal Form 941 reviews the gross pay and taxes due, and any tax due should be paid electronically so that the form shows -0- due. The Form 941 tells the IRS why you made the electronic payments.
In the state of Wisconsin, state forms are the WT6 for income tax withheld. Payments and reporting need to be done electronically through “MY TAX” on the WI dept of revenue website. The state determines the frequency of payments, whether monthly, quarterly, or annually.
Wisconsin unemployment is also due quarterly and based on a rate percentage given by the Department of Workforce Development Unemployment division. They also have an electronic reporting and payment system. Once you get your unemployment number, you need to request an internet access code. This code is necessary to setup the on-line reporting system. Unemployment is an employer tax due quarterly.
Federal also has an unemployment tax. The rate is applied to the first $7,000 of pay. If this amount goes over $500 it needs to be deposited electronically (EFTPS) in the quarter it goes over. If you have more than 8 employees you will need to watch this amount. The report is the 940 and is due at the end of the year.
The last year-end forms are the W2 – wage reports for each employee. These forms need to be filed with the federal government along with a total page (W3) and to the state government along with a total page (WT7 in WI).
I suggest that if you are unfamiliar with employment laws that you get help or training for setup and then again for the quarterly reporting. Contact me at (715) 379-0116 or email me at firstname.lastname@example.org. You can also connect with me on Facebook or LinkedIn.