Dirty Tips: Which Small Business Tax Law Do These Break?

Tips are very common in the restaurant and bar industry, but they are common in other industries as well. When was the last time you tipped someone outside of the food service business? Was it a hotel staff member, your VIP valet service, your masseuse or manicurist? It could have also been a moving company employee or your local tire repair shop technician.

As a payroll specialist for small business owners, we want to warn you that you should be aware that you are held to a more strict law regarding tips because the IRS requires the total amount of tips equaling more than eight-percent of all gross income for each employee must be reported during income tax season. Form 8027 helps the IRS to see the correlation of reported tips and gross income receipts.

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Small Business Payroll: How to Avoid Making Costly Mistakes

Angry employees surrounding your desk after receiving a less-than-satisfactory paycheck is not an ideal situation. Honestly, there are many opportunities to make mistakes in small business accounting. While the advent of more computerized systems reduced typos and errors relative to paper records, numeric or miscalculated equations can vastly still impact employees’ paychecks.

At Padgett Payroll Services®, there is no payroll mistake that we have not seen. Our payroll administrators are spread across 400 offices throughout the U.S. and Canada, so your small business has an expert nearby to advise you on payroll improvements. Here are some small details to improve in your small business payroll procedures to reduce the chances of making a mistake.

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