When it comes to the issue of taxes, Instant Tax Solutions is in the know. Along with Ian Woodman, Byron Pedersen is the co-founder of Instant Tax Solutions and he has seen their company help many in need of tax relief. Recently, Byron Pedersen answered some questions regarding business payroll taxes.
Question: From what we read, Instant Tax Solutions has a heartbeat for average, every day Americans and businesses to find tax relief.
Byron Pedersen: Yes, that is our goal and we have built Instant Tax Solutions on the cornerstone of integrity and placing our clients first.
Question: And you have grown rapidly?
Byron Pedersen: We have. We have a large staff of tax professionals, currently over 40.
Question: You must be doing something right, from what I read, you have experienced significant growth!
Byron Pedersen: We believe we are doing many things right. Yes.
Question: Very good. So help us understand business payroll taxes.
Byron Pedersen: Well, first there are two types of taxes referred to when “payroll taxes” are mentioned. You have both withholding taxes and then what is called Pay-As-You-Go or Pay-As-You-Earn taxes.
Question: Can you unpack those a little bit for our readers?
Byron Pedersen: Absolutely. Withholding taxes are exactly as they sound. A business is required by law to withhold a certain amount of the paycheck and forward it to the federal government. Withheld taxes cover Medicare, Social Security and federal taxes. Pay-As-You-Go or Earn are a business expense paid by the employer. In short, this form of payroll tax is directly related to the costs of an hourly or salaried worker.
Question: Are there other taxes that an employer may need to address that are included in the category of payroll tax?
Byron Pedersen: In many states, an employer also has to withhold city and state tax amounts as well.
Question: Sounds like a lot of paperwork!
Byron Pedersen: Absolutely. And I cannot stress enough, that it is vital for businesses large and small to keep accurate payroll information and then to keep it updated.
Question: Have you seen the consequences of poorly kept payroll records?
Byron Pedersen: We have. And then what may happen are extremely negative consequences as errors can occur.
Question: And that is where your organization might step in.
Byron Pedersen: Correct. Instant Tax Solutions can help a business sort through the mess and help a business meet requirements. Plus, a business does not want to deal with the hefty penalties and fines of the IRS.
Question: What happens if a business gets in trouble, maybe as the result of poor record keeping, and has not paid fully all the payroll taxes due?
Byron Pedersen: What kind of fines and fees or what steps do they need to take?
Question: Yes, what steps should they take…
Byron Pedersen: Well, it’s vital to speak with a tax attorney immediately. The last thing a business wants to do is wait when it comes to contesting or answering the IRS.
Question: So move quickly.
Byron Pedersen: Exactly. Once the IRS begins adverse action such as seizure of property, a business loses a lot of their bargaining or negotiating power.
Question: Thank you so much for your time with us today to briefly give us some quick facts on payroll tax.
Byron Pedersen: The pleasure was mine. Thank you.
Byron Pedersen is the co-founder of Instant Tax Solutions, a tax relief company helping individuals and businesses deal with a wide range of tax issues. The professionals at Instant Tax Solutions believe that the taxpayer should come first. The combined tax relief experience of the partners and staff of Instant Tax Solutions equals well over 100 years.