As a new American small business owner, here is my story of learning about the new taxes I have to pay when trying to create jobs. Or, a rant in 1000 words or less ( or more, IDK).
- Grow the business to a point where I am able to hire an employee. Yeah! I am helping the economy by creating a job and giving someone a livable wage. I am able to support myself and potentially another through my risk, my investment, and my hard work.
- Ask around for information about laws regarding hiring and what to expect in terms of regulations and taxes. Get connected to a representative of the labor department in my state. Continue to be told what I need to not fuckup with labor laws. Nothing is said about taxes and due dates I need to be aware of.
- Open up accounts and/or talk with three different state agencies that have no contact with one another and can’t tell me what else I need outside of their sphere of influence. Continue looking for information of taxes and due dates. Find some but not all.
- Get a payroll service that apparently handles everything because I am pulling my hair out looking for information on how to calculate employment taxes, UI insurance, workers comp insurance so I don’t fuckup and go to jail. The IRS website and IRC is the definition of insanity. Multiple places tell me to calculate based on instructions but no instructions are provided, they are on a different form. Which form…? Well…it depends on your specific tax situation. Okay…I think I found the right form. How the fuck am I supposed to read this 4 page long table of percentages and different wage brackets? Instructions on different form…again.
- I call someone. Not very helpful because I got connected to someone who doesn’t really know anything about business related tax information. Looks like called the wrong number. My fault? Should I call again and wait on hold for even longer?
- Hire employee, I think I’m good. I have accounts opened up at the three relevant state agencies, have W-2 forms, I have a payroll system. I even have direct deposit set up. So fancy.
- First pay period. All good. Second pay period. All good. Second month find I have to pay UI taxes, withholding taxes, SS taxes, medicare taxes. Fine, I knew that. My payroll system will handled it. Oh…wait. It only does it in certain states, mine not being one of them. My fault for not reading the fine print.
- I will just log into my state revenue dept. website. Pretty straightforward. Connect bank, send payment. Done.
- Now I need to pay federal withholding taxes. Should be straightforward..oh wait… its the IRS. IRS allows debit/credit payments but only for individuals and non withholding tax business payments. If I want to pay my withholding tax, I need to enroll in the EFTPS. Great, I created an account. Now I wait 7 days for my pin and password to be mailed to me. Shit, I need to pay in a couple days. My fault for not getting this sorted three weeks ago.
- I call the EFTPS, I need my pin. I call the IRS business line. They are so busy my call is dropped due to volume three days in a row. I start an online text conversation with an IRS representative. He doesn’t know shit because the online text portal is for individuals and not businesses. He refers me to call the EFTPS and then promptly ends the conversations. Well, I guess he is getting 1 stars for not even trying to help me.
- Decide I will take the tax penalty because it will be cheaper then wasting more time dealing with the huge, inefficient, unnecessarily complex tax and labor law bureaucracy.
This has been the most ridiculous time in my business operation. Some of it was my fault, yes, but I will say that our tax code is too complex. The average citizen should be able to understand and execute the tax laws of its country just by reading the tax code. The citizen should not have to pay outside help to try to either understand or execute the tax laws in its favor. I am really trying to follow the law to the best of my ability but dam, does the government make it hard to do that.
submitted by /u/Crossloader
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