accounting101

This chapter is an eye-opener for many workers. The employer has to pay payroll taxes on each dollar of wages paid to their employees. Did you realize your employer contributes 6.2% to your Social Security account? And 1.45% to Medicare on your behalf. Many people shy away from digging deep into the calculations, until there is a problem. The Tax Reform Act of 2018 had many people believing they would get a larger refund when filing income tax returns in April. That was not the case and now the IRS has responded with a new form in 2020. Please peruse this article so you will be prepared to complete this form when you start working and will know what happens to your pay if you dont fill it out. So many people are working multiple jobs such as Uber, Door Dash, Lyft, etc. so the revised form addresses that issue as well.

New W-4 Form for Employees in 2020

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If you employ independent contractors, there is a new 1099 Form called 1099-NEC versus using Box 7 in the 1099-MISC Form for Nonemployee Compensation.

IRS Takes Non-Employee Compensation Out of 1099-MISC: New Form 1099-NEC Article from CPA Practice Advisor

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What did you learn from these last two payroll chapters than can help you in your personal life and in your business if you have one?

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