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I am in small business and our accountant tells us that as a sole proprietor with no employees, we cannot do payroll. Our relative tells us otherwise. Also our relative told us that we shouldn't be filing a schedule "c" on our tax return. I thought that all small business owners file schedule "C". Does anyone know about payroll or schedule "C"? I am very confused. Our relative is trying to lead us to believe our accountant is inefficient. Please help!
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Arizona Payroll Services
As absurd as it is that you came to this forum to post a question about taxes...
btw - welcome to the forum :wave:
You - as a sole proprietor - do not do payroll. Payroll entails weekly/monthly payments of federal withholding and an "employee" share and "employer" share of FICA and Medicare to the government.
You are not an employer of yourself.
If you hired someone - you would get a EIN (employer identification number) and then you could withhold taxes as noted above on your employees.
When I was an s-corporation we were forced to treat ourselves as employees. That was not a beneficial position to be in - both the filing burden and the additional tax burden.
As a sole-prop you should be doing schedule SE (?if I remember correctly) quarterly to pay estimated taxes and then your annual 1040 to reconcile the whole mess.
Split into its own thread and moved to General Developer
I would go with the advice of the accountant as they should know what they are taling about.
If you are a sole proprieter then how many owners are there in your company?
And, CandyLady11, both RobDog888 and szlamany have some experience in working for themselves so their advice is born from experience. :thumb: