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Primer: Employment Taxes Alabama

If you have employees on your payroll, your tax situation is significantly more complex. You'll have to keep track of payroll taxes, employee withholding, Social Security, Medicare, unemployment, disability, and worker's comp, to name a few. All of these require separate calculations and timelines for payment. These rules are very strict and complex, and if you're not in the payroll business, hire an accountant or a payroll service to keep yourself legal and punctual with all these payments.

Local Companies

NationWide Tax Consultants
205-531-1043
4934 Summerplace Parkway
Hoover, AL

Percy Associates Inc
(251) 602-0007
812 Brighton Pl
Mobile, AL

Vantage Associates
(205) 879-0501
2100 Southbridge Pkwy
Birmingham, AL

Small Business Development Center
(205) 348-7011
250 Bidgood Hall
Tuscaloosa, AL

Dean Consulting Inc
(205) 951-3554
5266 Grantswood Rd
Birmingham, AL

Business Development Group
(205) 980-8979
200 Cahaba Park Cir Ste 212
Birmingham, AL

Vicotek Llc
(205) 678-3860
2265 Forest Lakes Ln
Sterrett, AL

Precise Home Management
(256) 350-4458
913 Ferry St NE
Decatur, AL

The Austin Group
(334) 262-4656
401 Adams Ave
Montgomery, AL

Millennium System Service Inc
(256) 890-9119
555 Sparkman Dr NW
Huntsville, AL

All employees must fill out a federal W-4 form and a Form I-9 from the Immigration and Naturalization Service. You should also check with your state's office of taxation to find out about state income tax, unemployment, and worker's compensation, as well as what forms, if any, need to be filed.

If you use independent contractors and pay them more than $600 per year, you must file a Form 1099 with the IRS and send one to the person you paid. You can get these forms from your accountant or from tax officials. The Form 1099 reports to the government that this person was paid as a non-employee. This gives you the right to deduct those payments as an expense and tells the IRS to look for that money as income on your non-employee's Schedule C form.

Your tax preparer should provide you with forms and envelopes for making your estimated payments, or you can order these forms directly from the IRS by calling 800-829-3676.

Featured Local Company

NationWide Tax Consultants

205-531-1043
4934 Summerplace Parkway
Hoover, AL

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- Classifying Contract Workers Alabama

One of biggest impediments to small business growth is the difficulty of classifying workers as independent contractors instead of employees. This is essentially a tax issue. An independent contractor -- someone who does work for your company but is not a full employee -- is responsible for paying his/her own taxes. If that person were classified as an employee, you would be responsible for taxes. But the IRS has a long list of qualifications a worker must meet to be classified as an independent contractor, and often business owners and the IRS disagree about who qualifies. The IRS qualifications are listed here, along with some steps you can take to increase the likelihood of your workers qualifying as independent contractors.

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Business Services	Fashion	Industrial Goods & Services	Retail & Consumer Services
Career	Financial Services	Insurance	Software
Cars	Food & Beverage	Internet	Technology
Computer Hardware	Franchise	Legal	Telecommunications
Construction	Health	Miscellaneous	Trade Shows
Education	Holidays	Nightlife	Travel
Entertainment	Home Appliances	Online Database	Weddings
Environmental	Home Electronics	Pets	World History