Paying Part-Time Employees

Part-Time Employees are no different from your regular employees. You need to withhold FICA from any amount they pay. It doesn't matter whether they are retired, have a full-time job elsewhere or only work one day a week. If eligible they will receive any overpayment of FICA back on their 1040 at the end of the year.

Here's a big one that is getting some employers in trouble. If a former employee returns as an 'independent contractor' to do the same job they were doing as an employee - they are employees. The IRS is targeting individuals who receive a W-2 and a 1099 from the same company in a given tax year.

The length of employment does not determine worker status. All employment taxes apply even if the individual only works one or two days, or even part of a day.


With part-time employees providing benefits is optional. You do need to cover yourself by having a written plan indicating which benefits apply to which workers. Generally, you do not need to pay for holidays or provide other benefits to part-time employees.

Some states may have special laws regarding payment of part-time employees so it is always advisable to check.

4 Strategies for Small Business Growth

Set a Goal

Create a business plan and/or monthly goals to track. Each month take a step back and see if you are meeting your goals. Use your financial reports to see where you are at. Make adjustments as needed.

Marketing

Determine what your core market is and develop a plan to target that market. Don't try to reinvent the wheel by targeting a market that really isn't adaptable to your business.

Customer Relations

Keep in contact with the customers you have. A happy customer will be a great source of referrals. An unhappy customer will, of course, have the opposite effect.

Is It Working?

Periodically review your strategies and keep the ones that are working for you. If you are finding some of your efforts are not producing any results it is time to change them. Don't stick with something that is not working.

Benefits of Using Software

Many people start out thinking they can just keep track of their income and expenses with their check book and a receipt box. Which you can do, but your accountant is not going to be very happy at tax time.

There are also those that use spreadsheets and templates to organize income and expenses into different categories. When that is done, they still need to generate financial statements which will involve yet another spreadsheet.

The simplest way to handle your business finances is to purchase a financial software program such as QuickBooks to organize all of your income expenses. You will only need to enter the data once and be able to generate professional, comprehensive financial reports.

Most programs also have the advantage of merging with your CPA's tax software for seamless and painless tax preparation.

Visit Keep It Simple Accounting for discounts on your QuickBooks product purchase and to schedule a Software Implementation and Training session.

A Quarterly Checkup

Even if you do your own bookkeeping, you may want someone to look it over before you give it to your accountant. Many accountants are blunt about sloppy books or bank statements that don’t reconcile. They will tell clients they must file for an extension, redo their books or get another accountant.

A quarterly checkup by an accounting professional can save you time and money by ensuring that your books are current and accurate.

Why Hire a Professional Bookkeeper?

You're starting your own business and one of the things you are considering is doing your bookkeeping yourself. Who needs a professional? How difficult can it be?

First, consider whether doing the books yourself is the best use of your time. Accounting is very detail-oriented. If your books are full of errors come tax time it will be costly having your CPA correct them in order to file an accurate tax return.

Secondly, if you are spending your time on your books, how will you develop and grow your business?

Hiring a professional, be it weekly, monthly or quarterly will allow you the time to do what you need to do to keep your business tracking forward.