Payroll Management: Ensuring Timely and Accurate Employee Payments

For many small businesses in Gloucester County, South Jersey, payroll management is a vital yet often complex task. It’s more than just issuing paychecks; it’s about understanding the nuances of payroll in a way that aligns with both legal requirements and the well-being of employees. At TMD Accounting, we specialize in simplifying this process, providing the expertise and personal touch that local businesses need to handle payroll effectively.

 

Key Takeaways

  1. Fundamentals of Payroll Management: The essential components of effective payroll.
  2. Legal Compliance and Best Practices: Aligning with New Jersey’s payroll laws.
  3. Common Payroll Challenges for Small Businesses: Identifying and addressing frequent issues.
  4. The Role of Professional Payroll Services: How TMD Accounting can streamline your payroll process.
  5. Customized Payroll Solutions: Tailoring our services to your business’s unique needs.

 

Key Elements of Payroll Management

Section

Description

Fundamentals of Payroll Management

Involves calculating wages, handling deductions, managing employee data, and ensuring timely payment distribution.

Legal Compliance and Best Practices

Understanding and adhering to New Jersey wage and hour laws, tax withholdings, and employment regulations.

Common Payroll Challenges for Small Businesses

Addressing challenges like staying updated with tax laws, managing diverse employee contracts, and ensuring accurate time tracking.

The Role of Professional Payroll Services

TMD Accounting alleviates the burden of payroll management, handling intricacies from calculations to tax filings.

Customized Payroll Solutions

Offering tailored payroll solutions to cater to the specific needs of your business’s size, industry, and individual requirements.

 

Fundamentals of Payroll Management

Payroll management encompasses several critical elements: calculating wages, handling deductions, managing employee data, and ensuring timely payment distribution. It’s important for businesses in Gloucester County to grasp these basics to maintain financial integrity and employee satisfaction.

Legal Compliance and Best Practices

Adhering to state and federal laws is a non-negotiable aspect of payroll management. This includes understanding the New Jersey wage and hour laws, tax withholdings, and employment regulations. Implementing best practices not only keeps your business compliant but also builds trust and reliability among your workforce.

Common Payroll Challenges for Small Businesses

Small businesses often face unique payroll challenges, such as keeping up with changing tax laws, managing diverse employee contracts, and ensuring accurate time tracking. These challenges can be particularly pronounced in the dynamic business environment of Gloucester County.

The Role of Professional Payroll Services

This is where TMD Accounting steps in. Our professional payroll services are designed to alleviate the burden of payroll management from small business owners. We handle the intricacies of payroll processing, from calculations to tax filings, allowing you to focus on growing your business.

Customized Payroll Solutions

Every business in Gloucester County is unique, and so are its payroll needs. At TMD Accounting, we offer customized payroll solutions that cater specifically to your business’s size, industry, and individual requirements. Whether it’s managing seasonal payroll variations or addressing specific tax considerations, our team is equipped to handle it all.

FAQs Section

Q1: What does payroll management involve?

A1: It involves calculating wages, handling deductions and taxes, managing employee data, and ensuring timely payments.

Q2: Why is legal compliance important in payroll?

A2: Compliance with laws prevents legal issues and maintains a positive reputation for your business.

Q3: What are common payroll challenges for small businesses?

A3: Challenges include staying updated with tax laws, managing different employee contracts, and accurate time tracking.

Q4: How does TMD Accounting help with payroll management?

A4: We provide comprehensive payroll services, handling calculations, tax filings, and offering customized solutions.

Q5: Can TMD Accounting tailor payroll services to my business needs?

A5: Absolutely, we offer personalized payroll solutions based on your specific business size, industry, and requirements.

Conclusion

Navigating the complexities of payroll management is a task that requires precision, legal knowledge, and a deep understanding of your business’s needs. In Gloucester County, TMD Accounting is your local partner in ensuring that your payroll process is smooth, compliant, and tailored to your business. By entrusting us with your payroll management, you gain more than just a service provider; you gain a partner committed to your business’s success. Contact us today to discuss how we can help streamline your payroll process, allowing you to focus on what you do best – running your business.

The Cost-Effective Solution to Payroll: Outsourcing to a Company in NJ

Although there are many options available that your company may use to outsource, one of the most popular business processes to hand over to an outside company is payroll. Let’s face it: Payroll can be complicated and time-consuming. That is why you should consider outsourcing to a South Jersey accountant, because there are many benefits to using their services.

What is Payroll Outsourcing?

According to accountants in South Jersey, payroll outsourcing is when you hire an outside source to handle your payroll needs. When deciding “is an accountant for my small business necessary for payroll,” there are certain things to remember. You can outsource the entire payroll process from creating time cards to paying tax balances. Or, you can choose to keep some facets of payroll in-house.

How Does Payroll Outsourcing Work?

Once you have made the decision to outsource payroll, you will need to determine what parts of payroll you want to keep and what you want to allow the outside company to handle. The first thing a South Jersey accountant will do is to establish a method to transfer information.

Keep in mind this is not just information about salaries, but also sensitive data related to your staff. The company will need names, social security numbers, vacation and sick day policies, expense allowance rules, addresses, wages and more. Therefore, accountants in South Jersey often ask for a data protection policy as well. Once the data is collected and entered, the outside company will begin processing payroll.

Benefits of Outsourcing Payroll

If your company does not have a dedicated finance and administration team in-house, outsourcing payroll is extremely beneficial as it will remove the burden of paying employees from staff who have other duties. Even if you have in-house financial experts, accountants in South Jersey can allow them to focus on strategic planning and other aspects of your company. Outsourcing payroll will also guarantee that your staff is paid in a timely manner and that your employment taxes are filed properly. At the end of the year, tax forms will be sent out to your employees so that they arrive as quickly as possible.

Things to Consider Before Outsourcing

Things you should consider when wondering “is an accountant for my small business payroll important” include the size of your workforce and the number of people who are currently responsible for the payroll process. You also want to remember that if just one person has been responsible for payroll, they may be concerned about job security. You will need to decide where that employee’s attentions will now be focused. Accountants in South Jersey are also beneficial if your company lacks adequate expertise and knowledge in payroll processes, especially if your business if fairly new. In addition, remember that you will need to determine if outsourcing will be less costly than the method you are currently using.

Payroll Outsourcing Saves Time and Money

Research indicates that outsourcing payroll to a South Jersey accountant can actually save time and money. Payroll is one of the most time-consuming business processes and by freeing up your financial staff by shifting payroll elsewhere, they can focus on goals that will help your company grow. In addition, the cost of outsourcing is almost always less expensive than paying employees to handle it.

Compliance and Error Protection

One of the main reasons to let accountants in South Jersey handle your payroll is that they are able to identify hidden costs you may have missed in your payroll. Not only that, you minimize the risk of errors, late payroll tax filings as well as missed deadlines. Your staff is paid in a timely fashion and you are sure to meet all payroll regulations necessary under governmental requirements.

Disadvantages of Outsourcing Payroll

There are a few disadvantages to outsourcing payroll. Although you will likely work closely with a TMD Accounting, you will still be handing control over to a third party. Your staff will still need to take time to coordinate certain tasks and activities. This may mean reviewing time sheets and expense reports before they are submitted to the accountants in South Jersey. It is still important to monitor results to be sure the outsourced company is meeting expectations.

What to Look for In a South Jersey Accountant

When deciding a company to handle your payroll, there are things you should look for. You want good internal controls that indicate the company is structured, organized and offers quality performance. You also want to choose a company that uses the most up-to-date technology. Accountants in South Jersey should be on top of regulations, especially changes to the United States tax code which is complicated and subject to change often. You also want to choose a company that has competitive pricing and offers outstanding customer service.

Looking to Outsource Your Payroll?

Outsourcing your payroll can be a complicated decision which is why you need to choose a South Jersey accountant that puts their clients first. At TMD Accounting, numbers matter and people count, a motto we have followed for more than 40 years. We are family-owned and operated, and our team takes pride in treating our clients well. We understand as accountants in South Jersey that payroll is a complicated process and we want to be sure your transition to outsourcing is as smooth as possible. Contact TMD Accounting today by calling 1-856-228-2205 or by filling out the easy online form. See how we can help take your company to the next level.

Navigating NJ Payroll Laws: Why Expertise Matters

Like many other things in New Jersey, the payroll tax laws are complex. As a small business owner, you must ensure compliance with the relevant laws that apply and make sure to remit the correct payroll taxes to the appropriate tax authorities. Failing to pay your payroll taxes on time or in full can result in substantial penalties. Here is some information about New Jersey payroll tax laws from a South Jersey accountant and why you should consider hiring the professionals at TMD Accounting.

Overview of Payroll Tax Laws in New Jersey

As an employer, you must comply with federal and state payroll tax laws. Federal laws include mandatory withholding of federal income taxes, Social Security, Medicare, and Federal Unemployment Insurance. New Jersey employers must also comply with the following state laws.

State Income Tax Withholding Laws

Under New Jersey’s laws, you must withhold state income tax from your employees’ paychecks and remit them to the state at regular intervals. These laws apply unless you also must withhold the income taxes of another jurisdiction at an equal or higher rate than New Jersey’s rate. You also have the legal obligation to withhold state income taxes for employees who are non-residents. Under New Jersey’s progressive tax system, you’ll need to understand the state’s income tax rates, which range from 1.4% to 10.75%. The highest rate applies to employees whose gross incomes range from $1 million to $5 million, and the lowest rate applies to those earning up to $20,000.

Employers must withhold income taxes of 21.3% from their employees’ wages applied retroactively to Jan. 1, 2020, as a catch-up provision. You must file payroll tax withholdings each quarter, and you must file a year-end payroll tax return electronically.

Reciprocity With Pennsylvania

New Jersey and Pennsylvania have a reciprocity agreement. This means that if you have an employee who lives in Pennsylvania, you’ll need to have them fill out Form NJ-165 to avoid New Jersey state tax withholding.

Unemployment Insurance

Most New Jersey employers must pay state unemployment insurance taxes. If you have one or more employees to whom you pay wages of more than $1,000 per year, you are required to pay state unemployment taxes. State unemployment taxes in New Jersey are based on a wage base of $34,400 per year. The rates range from 0.5% to 5.8% and are calculated each fiscal year. Your experience rate is calculated by taking the contributions you have paid and subtracting any benefits charged. You then divide that amount by your company’s average annual payroll. New employers are assigned rates for the initial three years based on their experience. Employers must also pay state disability insurance taxes, family leave insurance, and workforce development funds. Typically, these three types of taxes total around 0.0005%. When you pay state unemployment taxes in New Jersey, you might be able to take a discount of up to 5.4% on your federal unemployment taxes.

Workers’ Compensation

Employers in New Jersey must either carry workers’ compensation insurance or qualify to self-insure. To self-insure, you must seek approval from the Department of Banking and Insurance and show that your company has the financial ability to meet its legal obligations.

In addition to these various types of taxes employers must pay, there are a variety of forms that must be completed.

Why You Should Hire a Small Business Accountant in NJ to Handle Payroll

Below are some reasons why you should consider hiring a small business accountant in New Jersey to handle payroll for your company.

Leveraging Expertise

When you outsource payroll to a small business accountant at TMD Accounting, you can leverage their expertise and specialized knowledge. This can help to ensure you remain legally compliant and reduce the potential of costly errors.

Cost Savings

A professional accountant can help your business save money over the long run when you outsource your payroll to them by offering efficient, streamlined services. You can avoid the costs of hiring full-time employees to handle payroll while receiving valuable tax advice.

Ensure Regulatory Compliance

Payroll tax laws in New Jersey are complex, and complying with them can be time-consuming. It can be overwhelming to deal with regulations, laws, and payroll taxes if you don’t have a background in finance or accounting. By hiring a professional accounting firm, you can ensure regulatory compliance and avoid costly penalties.

Avoid Penalties

Most business owners simply don’t have the time to properly handle payroll and are prone to mistakes. This can result in potentially costly penalties. A South Jersey accountant can help you avoid fines, penalties, and fees assessed by the Internal Revenue Service by processing your company’s payroll correctly.

Maximize Deductions on Your Tax Returns

As accounting and tax experts, South Jersey accountants can help you identify and maximize available deductions on your taxes that are associated with payroll. This can help to keep your payroll costs low and reduce your taxable income.

Small businesses can enjoy numerous benefits by outsourcing payroll to professional accountants. An accounting firm can provide tailored solutions for your business to meet your payroll needs while also advising you about taxes and helping with filing your returns.

Find an Accountant for My Small Business

If you’re looking to outsource your small business payroll to an accountant in New Jersey, you should reach out to TMD Accounting. Our experienced accounting professionals can provide quality payroll services for your company. To learn more about the tailored solutions we can offer to your business, call us today at 1-856-228-2205.

The Importance of Accuracy in Payroll Processing for NJ Businesses

As a small business owner, you understand the need for accuracy. When it comes time for your payroll, you want to ensure that workers receive fair compensation for their labor. If you don’t manage your payroll, it can harm your business’s reputation and future prospects. You need an accurate system in place to avoid any issues for your company. Here are a few things to know about payroll processing so that you can prevent problems in the future.

Accurate Payroll Processing Is Vital for Your Business

You want to ensure that your business has accurate payroll processing measures in place. First, you want to make sure that all your employees receive fair compensation for their jobs. Missing a payment or using the incorrect rate can lead to frustration and distrust, resulting in increased turnover rates and decreased productivity from your employees.

Along with that, you always want to avoid any potential legal issues. Failing to pay your employees can lead to fines, legal fees, and lawsuits. As a result, it could damage your financial stability and the company’s reputation.

With a precise payroll processing system, you can maintain a positive public image for your business. You can attract more customers and employees when you are known for treating employees fairly and providing accurate compensation. In turn, that can lead to increased growth opportunities and profits.

Accurate payroll processing is essential for maintaining employee satisfaction, avoiding legal issues, promoting transparency and trust, and presenting a positive public image. For that reason, you will want to prioritize your payroll processing to ensure the long-term success of your business.

Why Do You Need to Outsource Your Payroll Processing?

Outsourcing payroll processing has become a popular option for businesses of all sizes. There are many benefits of outsourcing this task. It can help companies to streamline their operations while minimizing errors and ensuring compliance with regulations. Here are some key reasons you may want to consider outsourcing your payroll.

Cost Savings

Outsourcing payroll processing saves you money on staffing costs, equipment, and software. With these services, you no longer have to spend time and money training your in-house staff on complex payroll systems and regulations.

Time Savings

Outsourcing payroll processing can free up valuable time so that you can focus on other areas of the business. Hiring a company to handle your payroll can be beneficial if you have a small business. These companies often don’t have time to manage payroll by themselves.

Accuracy and Compliance

Payroll processing companies ensure that payrolls are processed accurately, on time, and in compliance with regulations. These services help to minimize errors and reduce the risk of penalties and fines for non-compliance. They also keep up to date with changes in tax laws and regulations, ensuring that your payroll is always compliant. This can help you avoid costly penalties and fines from the state and federal governments.

Data Security

Outsourcing payroll processing can help ensure that your sensitive employee information is secure. Payroll processing companies use the latest technology and security measures to protect your data from unauthorized access.

Expertise

Finally, these companies have the expertise and resources to handle all aspects of payroll processing, including complex tax calculations, employee benefits, and regulatory compliance. With that, you can ensure that your payroll is accurate and compliant while reducing the risk of errors.

Choosing the Right Payroll Processing Service for Your Small Business

When it comes to choosing a payroll service or South Jersey accountant, there are several factors that you should consider when selecting the best option for your business needs. Here are a few tips for choosing small business accounting services for your company.

Track Record of Success

You want to work with a firm with a proven track record of honesty and accuracy in handling federal, state, and local tax filings and payments. You should also know if the firm encourages clients to verify payroll tax payments using well-known methods, such as the Electronic Federal Tax Payment System (EFTPS).

Insured

A reputable payroll processor should have errors and omissions (E&O) insurance, a fidelity bond for crime protection, and cyber liability coverage to protect against potential losses or damages.

Solid Reputation

Along with integrity and insurance, you will also want to consider the reputation of the payroll service provider. The right firm should provide you with a long list of references who can vouch for the quality of their services. Make sure to contact these references and ask them specific questions to ensure that the provider offers excellent customer service.

Latest Technology

The payroll service provider should have the latest technology that seamlessly integrates payroll processing with employee time tracking and human resource management. Additionally, the service should offer employees a secure portal to access their pay and other relevant information. A reliable time and attendance system will be instrumental in tracking employee attendance, work hours, and paid time off.

Find an Accountant for My Small Business

Setting up proper payroll processing practices is crucial for the success of any business, no matter its size. At TMD Accounting, we have a team of expert accountants who can help create a payroll plan to pay your employees and keep your business compliant. We provide payroll and bookkeeping services to companies in various industries, including automotive and body shops, healthcare, construction, hospitality, restaurants, and professional services. If you would like to learn about our services, please contact us at 856-228-2205.

Simplifying Payroll Processing for NJ Business: An Overview

One of the most time consuming aspects of running a business is payroll processing. Although it may sound simple to compute the hours an employee works and cut them a check, the fact is that there are many other aspects to payroll processing that many business owners do not consider. These include payroll taxes, wage garnishments, labor regulations regarding hours and breaks as well as making sure payroll is executed and issued in a timely manner. The team at TMD Accounting offers these tips for simplifying your payroll processes.

Budget for Payroll

One of the biggest mistakes business owners make, according to small business accounting services, is not budgeting for their payroll costs. Keep in mind that payroll involves more than just paying your staff. You will need to have enough budgeted to not only cover employee salaries, but also withholding taxes that must be submitted to the Internal Revenue Service, your state, and your local government quarterly. What many new business owners don’t understand is that although your employee has FICA and Medicare tax withdrawn from their checks, as an employer you are also required to match those amounts. Therefore, you want to be sure that your budget includes the salary plus the taxes you will be required to submit.

Consider a Separate Bank Account

Although you are able to pay your staff from your main business account, using a separate account for payroll may help make your cash flow more transparent. When your company is growing, this can help you budget more easily. It will also help you keep better track of your payroll taxes, the cost of the benefits you offer as well as other deductions you may need to withdraw from your employee’s payroll checks.

Choose a Payday and Stick with It

Your employees expect to receive a paycheck at regular intervals and while there are pros and cons to the various time periods you use for payroll, whether it is weekly, bi-weekly, twice a month or monthly, once you decide when payroll will be issued, small business accounting services suggest you stick with that schedule. Keep in mind that the more often you pay your employees, the more you will need to track your withholdings which is why many employers use the bi-weekly or twice monthly methods for payroll says a South Jersey accountant.

Salary or Hourly?

One of the most frequently asked questions when people ask “is an account for my small business necessary” is whether paying employees a salary or paying them hourly is the best option. This may depend on the business you are in as well as what each employee does. In most cases, management will be placed on salary as their duties are more complex. Paying hourly requires a bit more work as you will need a method to track each employee’s hours every pay period. If you outsource your payroll to small business accounting services, they often have mechanisms in place that will track your employee hours for you.

Use Direct Deposit

Research indicates that more than 80 percent of all Americans are paid via direct deposit, and this is one of the best ways to streamline your payroll services. Direct deposit allows you to review reports before you transfer funds to your staff. There is no need for stacks of checks that need to be signed, envelopes to keep payroll private concerns about lost checks or any of the other issues that you face when you issue paper checks.

Payroll Policies

Another critical error many business owners make is not having policies in place for their employees and this is especially true of payroll. When you hire a new employee, there will be documents they need to provide, including copies of Social Security cards, filling out a W9 form as well as any benefit paperwork. Consider issuing a payroll policy that has time sheet deadlines, information about taking sick or vacation time, reimbursement for business expenses and more. You and the employee should sign the policy with a copy given to the employee as well as one in their personnel file.

Set Up Reminders

It is likely your employees will not be pleased if you forget to pay them, and it will be difficult to retain staff if you consistently make mistakes in their paychecks. Although using a South Jersey accountant will help prevent these errors, you can also make sure things are done in a timely fashion by setting reminders for yourself. These may simply be a reminder to submit approved forms in time for checks to be issued or one so that you remember quarterly taxes must be submitted.

Electronic Tax Filing

The IRS offers the option to file payroll taxes rather than mail in forms and a check. It is likely your state and local governments offer that as well. This helps eliminate the risk of payments arriving late and helps you remain compliant with the law. Usually, you will receive an instant confirmation that your payment was received which you can file for your records.

If you are asking “will an accountant for my small business help with payroll,” the answer is yes. TMD Accounting has been offering accounting services for more than 40 years as a family-owned and operated South Jersey accountant. Contact our team today about your payroll needs by calling 1-856-228-2205 or fill out the easy online contact form.

The Benefits of Working with a Local Payroll Company in NJ 

When it comes to outsourcing payroll, as a small business owner you have many options. You can choose to use a large national company to handle your payroll processes, or you can go with a small business accountant in NJ. If you are considering outsourcing your payroll, then one of the best choices you can make is selecting a local payroll company, such as TMD Accounting.

Personalized Solutions

One thing that national companies do not offer that a small business accountant in NJ would is services that are personalized specifically for your company. Many times, national companies have a “one-size-fits-all” approach to payroll, requiring your employees to use the same time sheets that giant corporations use. This may mean that the options don’t fit what your staff actually does or that the computations are not as accurate as they could be.

Local Customer Service

Whenever you use a national service for a business process, you run the risk of customer service representatives that are in another city, another state, or even in some cases, in another country. Using a South Jersey accountant to handle your payroll needs brings you someone local who will understand your needs better than a person who lives hundreds or thousands of miles away. In fact, by choosing a payroll company in NJ, those working with you may be friends, family or neighbors of many of the people who work for you, bringing you even more personalized interaction with the people who are paying your employees.

Compliance and Regulations

Although the national companies are well-versed in IRS regulations, they may not be as knowledgeable about the requirements in your state. Even if they offer an office within the state which means they understand those regulations, they still may not understand local requirements and regulations. By choosing a South Jersey accountant, you are more likely to get someone who thoroughly understands the regulations and requirements of the area and not just IRS regulations.

Keep in mind that the United States passes around 8,000 laws each year and many of these can impact the tax code. At the state level, a recent study found that the average state passes 128,000 laws each year, 23 times more than the U.S. Congress. This is why having a small business accountant in NJ handling your payroll makes more sense than a national company who may only understand federal tax law.

Less Costly

When you choose to outsource your payroll to a small business accountant in NJ, it will likely cost you less than it would a national company. Although national companies may offer basic packages that seem to cost less, these usually are extremely basic and may not cover all the options you will need to adequately handle your payroll. By hiring a local payroll company in NJ, you may find that their basic package includes many more options which will actually save you money in the long run.

Dedicated Representatives

Another benefit to choosing local is having dedicated representatives who get to know your business and your employees. For example, at TMD Accounting, a knowledgeable payroll company in NJ, one of our team members will be tasked with learning the ins and outs of your business. The staff gets to know you and will have working knowledge of how you need your payroll system to operate. This will help your payroll system run much more smoothly and will actually save you money in the long run.

Human Interaction

Small business accountants in NJ offer a personal touch that many large, national companies do not offer. When you need a question answered and are working with one of the large companies, you may have difficulty reaching someone to help you. In fact, you may have difficulty talking to a human at all. Many offer websites that they claim have “the answers to all your questions” only for you to find out the questions have to be ones that a chatbot can answer. That means if your question is at all unusual, there will be no one who can help you. With a South Jersey accountant, you know that the phone will be answered by a human and your question, no matter how unusual, will be answered by a human.

Local Specialist

The main reason to choose a payroll company in NJ is that they are local specialists when it comes to payroll. They not only understand state and local laws, they also understand the people who work for you. They know how important payroll that is correct and timely is to your staff. They also understand how important complying with laws is to you as failing to do so could put your entire business at risk. A South Jersey accountant will make sure that your company is following the law and paying your staff correctly. Not only that, using a small business accountant in NJ can save you time, allowing you to focus on the things that will help your business grow rather than focusing that time on payroll.

If you are considering outsourcing your payroll, contact the expert South Jersey accountant firm of TMD Accounting. With more than 40 years’ experience in the industry, our team of accountants can help get and keep your payroll on track, make sure you are compliant with all laws and allow you to focus on the things that will help your business grow. Our motto, “where numbers matter and people count” is one we have lived by since we opened our doors. Family-owned and operated, we are here to help with all your payroll needs, so give us a call at 856-228-2205 or fill out the online contact form for more information.

Navigating the Complexities of Payroll with a South Jersey Accountant 

Payroll management is a crucial task for any business, no matter its size. However, navigating the complexities of payroll can be complicated, especially for companies in South Jersey. With federal, state, and local regulations, tax rates, and compliance requirements, you will want an experienced accountant who can guide you through the process. Learn how to navigate payroll complexities with the assistance of a qualified accountant.

The Challenges of Payroll Management

Many factors can complicate payroll management in New Jersey. For example, the state has specific laws and regulations related to employee classification, overtime pay, sick leave, and vacation pay. Employers must follow these laws and regulations to avoid legal issues.

Additionally, there are specific requirements regarding recordkeeping and reporting, meaning employers must keep accurate records of their employees’ hours, pay rates, and deductions. If you fail to maintain accurate records, that can lead to legal issues and penalties.

Along with that, you must file both state and federal taxes. Once again, failing to file can lead to penalties and legal problems. New Jersey businesses must also pay state unemployment, workforce development, and disability insurance taxes.

State payroll management can be a complex and challenging task for businesses. For that reason, all companies can benefit from hiring an experienced accountant who can help them navigate through the complexities of payroll management and ensure compliance with all regulations.

The Benefits of Hiring a South Jersey Accountant for Payroll Management

Hiring a South Jersey accountant for payroll management can bring numerous benefits to your business, especially when navigating the complexities of processing and administration. An experienced accountant fully understands the regulations that impact payroll management, including minimum wage laws, tax rates, and unemployment insurance requirements.

Processing payroll can be time-consuming and tedious for businesses with many employees. An accountant can handle all aspects of payroll processing, from calculating employee wages to filing taxes. With help from a South Jersey accountant, you can save time and reduce the risk of errors.

Compliance is critical when it comes to payroll management. An accountant can help ensure businesses comply with all applicable regulations and avoid potential issues in the state. As previously mentioned, non-compliance with payroll regulations can result in penalties, fines, and legal issues. When you work with an accountant, you can reduce the risk of these negative consequences.

Services Provided by a South Jersey Accountant for Payroll Management

A South Jersey accountant can provide various services to help businesses with their payroll management needs. Here are some of the critical services that your accountant can offer to your business.

Payroll Processing and Management

An accountant can handle payroll processing, including calculating employee wages, tracking hours worked, and processing payroll checks. These professionals can help track payroll for both salaried and hourly employees.

Tax Filings and Compliance

When you hire an accountant, they will handle all payroll tax filings, including preparing and filing quarterly and annual tax returns. These professionals can also conduct any payroll tax audits that may occur.

Employee Benefits Administration

These individuals will help manage your employee benefits programs, including health insurance, retirement plans, and employee contributions.

Recordkeeping and Reporting

When you need accurate payroll records, turn to an accountant. These professionals will provide your business with regular payroll reports, handle payroll-related audits, and manage investigations.

Hiring a South Jersey accountant can streamline your payroll management processes, reduce the risk of errors and compliance issues, and ensure that the payroll records are accurate.

How to Choose the Right South Jersey Accountant for Your Business

When it comes time to select a South Jersey accountant for payroll management, there are several factors to consider to make the right choice. First, you want to look for a professional with relevant experience for the job. When evaluating potential accountants, find someone with experience working with businesses similar to yours. In addition, you should choose an accountant who understands the specific payroll tax laws and regulations that apply to your industry.

Effective communication is important when it comes to payroll management. Businesses should look for an accountant who is responsive to their needs and questions. These individuals should also be able to provide regular updates and reports on payroll processing.

While cost is important, you need to understand the value of small business accounting services. A low-cost accountant may seem like a good deal, but if they cannot provide the support needed to ensure accurate payroll management, the cost savings may not be worth it in the long run. You should look for an accountant who offers fair pricing and can provide a clear breakdown of costs and services.

By working with a knowledgeable and experienced South Jersey accountant, you can ensure they stay compliant with all applicable payroll tax laws and regulations. They can also streamline your payroll processing and reduce the risk of penalties and legal issues. You want to find an accountant with the expertise and skills to manage your payroll processes effectively.

Need an Accountant for My Small Business?

Contact TMD Accounting today to explore your options for hiring an accountant for your business. We provide personalized and attentive service to all of our clients. Our TMD Accounting team serves businesses in the automotive/body shops, healthcare, construction, hospitality, restaurants, and professional services industries. With over 40 years of accounting experience, our team will ensure your accounting needs are handled professionally and accurately. If you want to schedule a consultation, please call us at 856-228-2205.

Avoiding Common Payroll Mistakes: How NJ Companies Can Benefit from Outsourcing 

Operating a business can be exciting and fulfilling, but it can also be challenging, especially when it comes to handling payroll. A business owner wants to keep stakeholders happy and one of the most important stakeholders is staff who expect to be rewarded financially for their skills. TMD Accounting provides you with these tips to help you avoid payroll errors and offers details on how outsourcing may be beneficial.

Payroll Delays

One common mistake when processing payroll is failing to complete the process in a timely manner. This can lead to delays in employees receiving compensation. With many people now setting their bills to be paid automatically and if their payroll is delayed, this could lead to overdraft charges as well as payments being returned for insufficient funds. This can also lead to dissatisfaction among employees. Small business accounting services recommend running payroll three to four days prior to payday. It is also important to keep in mind that bank holidays may also lead to a delay, so if a holiday falls around the date you normally process payroll, you may want to add an additional day of processing, so your employees are paid on time.

Tax Payments

Once you withhold taxes from your employees, you must then pay them to the proper entity. Most employees will have Social Security, Medicare, federal and state taxes deducted from their check while some areas may also have a county or city tax. In addition, you may have to withhold insurance payments or payments to retirement funds. It is imperative that anything withdrawn from an employee’s paycheck is sent to the proper location. South Jersey accounting services understand the law and are able to make sure that the proper amounts are withdrawn and that payments are made in a timely fashion and sent to the proper entity. Failure to properly handle employee withholdings can put your business at risk. In addition, paying your taxes late can incur a 10 percent or higher penalty.

Employee Classifications

One of the biggest mistakes businesses make in payroll is not properly classifying employees. Your staff is generally classified as either an employee or an independent contractor. Often, businesses will try to claim a staff member is an independent contractor in order to avoid paying payroll taxes. However, there are specific requirements that must be met for an employee to be an independent contractor. For instance, if your employee must report to work at a certain time each day and must request time off, they are likely not an independent contractor. Using the wrong classification can lead to significant penalties, according to a small business accountant in NJ.

Improper Records

Another common mistake is not keeping proper payroll records. Small business accounting services point out that pay stubs and other forms may be needed by employees many years after you issue them. This means you need to archive the data should they be needed in the future. In most cases, you will need to retain records for between three and seven years, although some may require retention even longer. If you issue paper checks on occasion, such as for bonuses, you will also need that information included in your payroll system.

Expense Reports

If your employees have expense accounts, you will also need to track those in your payroll system. South Jersey accounting services say that in order for an expense reimbursement not to be taxable, it must be for a documented expense that is business related. For example, if you have employees who travel, their meals and lodging are a business expense, so they are not subject to payroll withholding. However, you must have documentation to confirm that these were valid expenses and not actual salary. If employees take home company cars, that may be a taxable benefit as well.

Delayed W-2 Forms

The law requires that every employee receive a W-2 form unless they are an independent contractor, in which case they would receive a 1099 form. Those forms must be mailed to your employees no later than January 31 each year. Filing deadlines may vary depending on your state and local government, a small business accountant in NJ says.

Payment of Unemployment Tax

The federal government requires all states to offer unemployment compensation programs. Failure to pay state employment could result in the loss of federal unemployment credits at the end of the year. You may also pay an incorrect rate which is why using small business accounting services is recommended. In addition, some states. Have both employee-paid and employer-paid unemployment taxes.

Payroll Outsourcing

There are several benefits to outsourcing your payroll. South Jersey accounting services are able to provide you with expert tax advice while also making sure your taxes are paid in a timely fashion. Outsourcing payroll can also save you time. Research shows that the average business owner spends almost five hours calculating, filing and paying payroll taxes every quarter. Working with a small business accountant in NJ frees up that time so you can spend it building your business.

Outsourcing also provides better security as your employee information is protected. Employees are also more satisfied as they are paid on time and their paychecks are calculated correctly. There is evidence that just two payroll errors will lead over half of your workforce looking for another job.

If you would like some help with managing your payroll, contact TMD Accounting to see how our experienced team can help. We offer South Jersey accounting services that are flexible, reliable, and affordable. With over 40 years’ experience, our family-owned and operated accounting agency continues to live up to our motto: “Where numbers matter and people count.” Contact TMD Accounting today by calling 1-856-228-2205.

The Ultimate Guide to Independent Contractor Taxes – New Jersey

Independent contractors have to worry about federal income tax, self-employment tax, and local and state taxes when they file their returns. Sole proprietors use Schedule C with Form 1040 to report their business profits and losses to calculate the taxes they will have to pay. To avoid an underpayment penalty, independent contractors must also submit quarterly estimated tax payments each year. When you begin working for one or more companies, they should determine whether you should be treated as an independent contractor or employer based on several factors. If you are classified as an independent contractor, you will be responsible for paying both your portion and the employer’s portion of your taxes and will receive a 1099-NEC at the end of the year instead of a W-2 for your annual earnings. Here is what you need to know as an independent contractor about taxes from TMD Accounting.

Taxes Self-Employed People Must Pay

Independent contractors must pay federal, state, and local taxes and the federal self-employment tax. Here are the taxes self-employed people must pay:

  • Federal income tax at a rate ranging from 10% to 37% based on the total income for the tax year
  • Self-employment tax to pay into Medicare and Social Security with tax rates of 15.3% for net profits of up to $147,000 and 2.9% for net earnings above that amount
  • Additional federal taxes in some situations such as the net investment income tax, alternative minimum tax, and additional Medicare tax
  • State and local taxes, including income tax, registration and licensing fees, and business tax
  • Sales tax if you sell goods
  • Excise tax if you sell items such as guns, cigarettes, alcohol, or telephone services

Understanding the Self-Employment Tax

The self-employment tax includes a 12.4% Social Security tax on your net profits up to $147,000 and a 2.9% Medicare tax on all net earnings. This means you will pay a total self-employment tax of 15.3% on your earnings up to $147,000 and 2.9% on any earnings above that amount. If you have net earnings of more than $200,000 as a single taxpayer or $250,000 as a joint filer, you might also have to pay an additional 0.9% Medicare tax.

Available Deductions for Independent Contractors

There are many different deductions that might be available to independent contractors, including the following:

  • Home office deduction for contractors who work from home and use the office space solely for business purposes on a regular basis
  • Health insurance premiums
  • Retirement plan contributions
  • Depreciation of your equipment, machinery, and furnishings for your office and business use
  • Truck and auto expenses if used for work
  • The qualified business income deduction
  • Expenses for outside services and contract labor
  • Miscellaneous business expenses

Preparing to File Your Taxes as an Independent Contractor

Before you file your taxes, it is important for you to organize everything. You will need to know the gross amount you made as an independent contractor and how much you spent on tax-deductible expenses. Gather your 1099-NECs, profit and loss statements, expense statements and bills, receipts, and other relevant documents together.

Report Income and Deductions on Schedule C

When you fill out your Form 1040, you will use Schedule C to report your business income and deductions. You will report other sources of income, including rental income, dividends, and interest on Form 1040.

Report Net Self-Employment Income on Schedule SE

Once you complete Schedule C, you will then carry over the self-employment income to Schedule SE to calculate your self-employment tax. The self-employment tax will then need to be entered in your Form 1040 tax section.

Complete Form 1040

On your Form 1040, you will include all of your other non-business income. You can also claim non-business deductions on Form 1040, including things like student loan interest, charitable donations, self-employed health insurance, itemized deductions, and others.

Calculate Your Federal Taxes

When you enter everything into your Form 1040 and perform the calculations, you will see your total federal tax obligation. After you subtract your estimated tax payments made during the year, you will either owe taxes or have an expected refund.

Estimate Your Taxes for the Next Tax Year

As a self-employed person, you will need to estimate the taxes you’ll likely owe in the next tax year so that you can divide that amount into quarterly estimated payments to send each quarter throughout the year.

Complete Your State Income Tax Return

Once you have completed your federal tax return, you will then need to complete your state return.

What Happens if You Can’t Pay?

If you can’t pay your taxes in full, you can complete Form 9465 to request an installment arrangement. However, you can’t owe more than $25,000 and must show that you do not have the means to pay your taxes. You will then have three years to pay. The IRS will penalize you for waiting to pay your taxes after the deadline. If you fail to file a tax return by the deadline, you will be assessed a 5% penalty for each month of the outstanding amount you owe but haven’t paid. If you submit your return on time but do not pay what you owe, the late payment penalty will be 0.5% of the tax owed for each month you are overdue.

Find an Accountant for My Small Business

Small business accounting services can help to make filing your taxes simpler. If you are self-employed, working with TMD Accounting might help to ensure your taxes are filed on time and correctly and that you claim the deductions that are available to you. Contact us today to schedule an appointment at 1-856-228-2205.

How to Pay Yourself From an LLC

How to Pay Yourself From an LLC

When you have an LLC (limited liability company), paying yourself can be complicated. How you take out money will depend on whether you are a multi-member, single-member, or corporation LLC. Here is how you can pay yourself through an LLC and make sure those earnings meet the IRS guidelines.

 

What Is an LLC?

An LLC is a business structure that combines the features of a sole proprietorship and corporation. Like a corporation, LLCs have limited protection against personal liability and debt. You will report business profits and losses on a personal tax return rather than a business one. There are three types of LLCs: single-member, multi-member, and corporate.

 

Single-member LLCs will have only one member. The IRS views single-member LLCs in the same way as sole proprietorships for tax purposes. Multi-member LLCs have more than one member. For tax purposes, the IRS treats these LLCs as a partnership.

 

Finally, there are corporate LLCs. In these situations, the LLCs are taxed as a corporation. If you want to establish your business as a corporate LLC, you must make a formal request to the IRS.

 

How LLCs Are Taxed

There are different ways that the IRS taxes an LLC. If you have an LLC, you will want to work with a company that specializes in small business accounting services. They can help simplify the process as your tax situation becomes more complex with an LLC.

 

Sole proprietorships and single-member LLCs are considered “disregarded entities.” That means the company’s losses, profits, deductions, and other financial information are reported on a Schedule C with a personal tax return.

 

Multi-member LLCs are a bit different. These partnerships do not file separate tax returns. Instead, they file a return with Form 1065 or Schedule K-1. These forms detail each member’s guaranteed payments and distributions for the year.

 

After that, the members will report their income with a K-1 on Schedule E for the tax return. Plus, they must report all self-employment tax on Schedule SE. Single- or multi-member LLCs do not pay corporate taxes. Keep in mind that single owners and LLC members are responsible for income tax on the company’s income. Along with that, they must pay a self-employment tax on their withdrawals for the year.

 

If the LLC is a corporation, the business must file Form 1120. All of the standard corporate tax rules apply. If the LLCs have elected to be considered an S corporation, all owners must report their portion of the corporate income, and the company needs to file Form 1120S.

 

Taxes can be tricky for LLCs. Some of the rules are different depending on your LLC structure. While you can use software to figure out your taxes, consider hiring a professional accountant for the job. With their help, you can make sure you pay the right amount of taxes for your LLC.

 

How You Pay Yourself as an LLC

The business structure of your LLC will determine how you can pay yourself. Even if you are an employee of your business, you need to find the proper way to pay yourself to avoid tax liabilities.

 

Single-member LLCs will function as sole proprietorships. According to the IRS, these companies are considered a “pass-through” business, which means the income “passes through” the partnership to be taxed under the owner’s personal income tax. As a result, an owner of a single-member LLC or sole proprietorships can pay themselves using the owner’s draw method. With that, you write a check from your LLC to your personal account.

 

The pass-through designation also extends to multi-member LLCs. According to each partner’s ownership percentage, all partners are taxed on the LLC’s income. In some cases, the partners will receive an owner’s draw. That income is considered a prepayment for profit distribution, and these draws can happen at the end of the quarter or year.

 

Other owners prefer a steady salary and will take a guaranteed payment. These payments are paid out even if the business has income loss. Guaranteed payments are considered business expenses, and they will increase the company’s net income. Multi-member LLCs will pay their members with owner’s draw, guaranteed payments, or a combination of these options. Once again, an owner’s draw is simply writing a check. The owner’s draw payments are subject to the self-employment tax.

 

Some LLCs have elected to be treated as an S corporation or C corporation. In those situations, the payout can be more complicated. With these tax classifications, the owners cannot take an owner’s draw, and they must be treated as an employee of the LLC. The owner-employee must receive reasonable compensation. You must issue all payments through a payroll system that withholds employee taxes. Along with that, the owner-employee can take a dividend or distribution of the company’s yearly profit. Those payments are considered taxable income.

 

Guidelines for Paying Yourself

While you might want to forgo paying yourself to help the business grow, you will still be taxed on the total amount of business income. Remember to pay yourself. You want to follow some basic guidelines when forming your payment structure.

 

If you have a partnership, always establish a guarantee payment amount or dividend schedule for the other members. You can set this up using your articles of corporation or partnership agreement.

 

You will want to work with an accountant to figure out your estimated tax payments. Ensure there is always a paper trail for your payments, whether guaranteed payment or owner’s draw. Record the payments in your company’s books so that you are protected in the event of an audit.

 

Understand Payouts for Your LLC Situation

As you can tell, LLCs do protect you from debts and liabilities, but they can lead to complications for tax time. At TMD Accounting, we can ensure your small business is covered for tax season. We have over 40 years of experience helping small and large companies with their taxes, payroll, and bookkeeping. When you need an accountant for your business in South Jersey, schedule a consultation by calling 856-228-2205.

 

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