Do you have a spouse, child, or a parent working for you? If so, did you know you could be paying more Federal payroll taxes than required? No one wants to pay more taxes than they are required to pay! There are a few different taxes on payroll; Social Security tax (SS), Medicare tax (Medi), and Federal Unemployment Tax (FUTA). Some of these taxes might not apply to you, depending on your relationship type with the employee.
For more information, read the full article: IRS Fact Sheet 2019-14, for IRS guidance on the tax treatment for family members working in the family business. The article explores various diverse circumstances; Spouse employed by Spouse, Child employed by Parent, and even Parent employed by Child. The article also described several critical differences with small business structures and how that can impact Federal payroll taxes too.
As always, our CPAs at Mason + Rich are ready to answer any additional questions. Feel free to call us at 603-224-2000.
As always, our CPAs at Mason + Rich are ready to answer any additional questions. Feel free to call us at 603-224-2000.
