PAYROLL SETUP & MANAGEMENT

The administration of the financial record of employees, salaries, wages, bonus, net pay, and deductions.

An employer, regardless of the number of workers they employ, must maintain all records pertaining to payroll taxes (income tax, withholding, social security and federal unemployment tax) for at least four years after the tax becomes due or is paid, whichever is later. Although, 20 different kinds of employment records must be kept just to satisfy federal requirements.

Income Tax Withholding Records: 

  1. Name, address, and Social Security number of each employee.
  2. Amount and date of each payment for compensation
  3. Amount of wages subject to withholding in each payment
  4. Amount of withholding tax collected from each payment
  5. Reason that the taxable amount is less than the total payment
  6. Statements relating to employees nonresident alien status
  7. Market value and date of noncash compensation
  8. Information about payments made under sick-pay plans
  9. Withholding exemption certificates
  10. Agreements regarding the voluntary withholding of extra cash
  11. Dates and payments to employees for non-business services
  12. Statements of tips received by employees
  13. Request for different computation of withholding taxes

Social Security (FICA) Tax Records:
1. Amount of each payment subject to FICA tax
2. Amount and date of FICA tax collected from each payment
3. Explanation for any difference