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- What form do I need to report federal income taxes?
- What does FUTA stand for?
- What does FICA stand for?
- When would I change my EIN?
- Do I have to withhold taxes for my employee?
- I'm changing to an S-Corporation.
Do I need to change my EIN?
- How do I apply for an Employer ID Number?
- Why do I need an EIN?
- What form do I need to report federal income taxes?
Business owners use form 940 or 940ez to report unemployment taxes. Sole-proprietorships and partnerships do not pay FUTA on the employer's compensation.
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- What does FUTA stand for?
FUTA is the Federal unemployment tax assessment. This tax must be withheld by the employer for each employee. The employer is responsible for paying this tax. Employers are also given credit for participating in their state unemployment program. This credit can be used by the employer to reduce his FUTA rate.
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- What does FICA stand for?
The FICA is a withholding of an employee's share of the Social Security and Medicare taxes. An employer is responsible for withholding FICA taxes for himself and each employee.
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- When would I change my EIN?
You may need to change your EIN if: 1. You incorporate your sole-proprietorship, you may need to upgrade or change your EIN. 2. Your sole-proprietorship takes on a partner. 3. Your corporation is downgraded to a sole-proprietorship. 4. You purchase an existing business. 5. You start a new company after terminating an old one.
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- Do I have to withhold taxes for my employee?
Yes, if the employee is being paid a salary through the company, you must withhold Federal Income Taxes (FIT).
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- I'm changing to an S-Corporation.
Do I need to change my EIN?
You do not need to change your Employer ID number (EIN) just because you are changing your business type.
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How do I apply for an Employer ID Number?
To apply for an EIN, use government form SS-4. The SS-4 is the official application form used for applying for an employer ID. This form is sent directly to the IRS, which will then issue your ID number.
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- Why do I need an EIN?
The Employer Identification Number (EIN) is used to by the government to identify your firm. Banks and other financial agencies use the EIN very much the way a Social Security number is used by an individual. Some banks won't even open up a business account for your company unless you have an EIN.
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