Record Keeping Basics
Tools for record keeping
Audit proof your business - Internal records
Summary of required documents
When you hire an employee, the employee should complete:
- Form 1-9
- Fed and state W-4
As an employer, you are expected to withhold, report and pay taxes to the authorities. Every month make the following deposits to the tax authorities:
- Social security taxes withheld and paid by the employer: As an employer you are responsible for paying half of your employees social security taxes.
- Medicare taxes withheld and paid by the employer: As an employer you are responsible for paying half of your employees medicare taxes.
- Federal income tax withheld
- State income tax withheld.
At the end of the quarter file and pay the balance on:
- Form 941 – payroll tax return for both federal and your state equivalent
- State unemployment tax – file and pay your state unemployment tax
At the end of the year, file:
- Form 940 – Federal unemployment tax return. Pay any balance due
Keep all these records for at least 7 years.