Educational Center
ATM Tax Pro Solutions Educational Center will provide answers to your queries.
- What Is a Dependent Exemption?
- What Does Adjusted Gross Income Mean?
- Income Tax Return Amount Due Meaning
- Business Taxes
- What Is a Commission?
- Direct Deposit Definition
- What Is Direct Tax?
- Earned Income Definition
- What Is the Earned Income Tax Credit?
- Electronic Return Originator Meaning
- What Is a Flat Tax?
- What Is an Injured Spouse Claim?
- What Does IRS Innocent Spouse Relief Mean?
- What Is Property Tax?
- Tax Deficit Meaning
- Electronic Filing
- Employee Taxes
- Excise Tax
- Tax Exempt
- Compulsory Filing of Income Tax Return
- Gross Income Meaning
- What Are Exemptions on Tax Returns
- Test to Become a US Citizen
- What Is Head of Household
- What Is Federal Income Tax?
- What Is an Authorized E-File Provider?
- Who Needs to File a Tax Return?
- Learn All About Financial Records
- What Is An Offer in Compromise and What Does It Mean?
- What Does Non Collectible Status Mean?
- What Is a Federal Tax Lien?
- Benefits Received Principle Definition
- Ability to Pay Definition
- Bonus Definition
IRS Definition of Employee
Every business must understand the definition of an employee. If a business pays self-employed contractors, it does not need to withhold taxes from that pay. But with an employee, the business must calculate income, social security, and unemployment taxes based on wages.
What is the difference between a self-employed and employed worker? With an employee, a business has:
- The authority to decide the way he or she works
- Direction over the business and financial components of a job (whereas independent contractors make those decisions themselves)
- A relationship with the employee that is understood as an employer-employee type
Some businesses attempt to classify workers as independent contractors when there is no other reason to besides tax avoidance. But if they can show that workers are not employees, they can reduce their tax burden.
How to Pay Employee Taxes
As a business, it is your responsibility to send withheld employment taxes to the IRS through an electronic funds transfer, along with Medicare and social security taxes. Before each calendar year starts, you also must decide which payment schedule you will use: either semi-weekly or monthly. Being late can cost you a percentage of the taxes.
You must also pay unemployment taxes every quarter if the amount exceeds $500.
ATM Tax Pro Can Help You File Your Taxes Electronically
Reach out to us with any inquiries about filing business taxes for your employees. ATM Tax Pro assists businesses and individuals with filing taxes correctly and paying off tax debt. Make an appointment with The Tax Doctor now to get a free consultation.