Frequently Asked Questions

Here are the most common questions we receive from new employers. If you have additional questions, please call PayrollAccountantLive.com Customer Service toll free 1-866-730-2729, Monday through Friday, 8:30am to 6:30pm Eastern Standard Time.

Q. Do I need to register as an employer?

A. You must register with both the federal government and your state when you hire your first employee. When you register, you are assigned a federal employer identification number (FEIN) and usually, a state employer identification number (EIN). In some states, you register with both the state revenue agency and the unemployment insurance agency. When you set up your PayrollAccountantLive.com account, we provide information and links to federal and state registration applications.

You won’t need identification numbers until it’s time to pay and file taxes, so you can run payroll before you receive your numbers. The fastest way to register and receive an FEIN is online.

Q. How do I know how much to withhold?

A. Have each employee fill out a Form W-4 to tell you their status and allowances. As you set up each employee in PayrollAccountantLive.com, you enter this information. PayrollAccountantLive.com can now calculate withholding taxes. You may also withhold voluntary deductions, such as health insurance or retirement plans. PayrollAccountantLive.com also supports involuntary deductions such as garnishments for which you receive a court order that explains the amount to withhold.

Q. Is my contractor really an employee?

A. The amount of control the employer has over the worker determines whether or not the worker is an employee or an independent contractor. If the employer controls what must be done and how the work gets done, and supplies the tools to complete the work, then the worker is an employee. If the worker controls how the work is to be done, the worker is self-employed. Self-employed workers usually provide their own tools and have independent businesses serving multiple clients. See IRS Publication 15, Circular E: Employer’s Tax Guide for more information regarding whether a worker is an employee or a contractor. (The PayrollAccountantLive.com Resources/Federal Government Resources page contains links to this publication.)

Q. As the owner of a business, am I considered to be an employee?

A. The owner, sole proprietor, or partner in a small business does not earn wages and is not considered an employee (some LLC members and S Corp owners are also not employees). Do not set up these individuals as employees in your PayrollAccountantLive.com account. To confirm a worker’s employment status, talk to your accountant or see IRS Publication 15, Circular E: Employer’s Tax Guide (the PayrollAccountantLive.com Resources/Federal Government Resources page contains links to this publication).

Q. What forms must I file?

A. PayrollAccountantLive.com will let you know which federal and state payroll forms you must complete by adding them to your To Do list. You can check your To Do list at any time by clicking the “To Do” tab at the top of every page. In addition, PayrollAccountantLive.com sends you an email reminder when it’s time to file a form (state forms are included with PayrollAccountantLive.com Payroll Plus only).

PayrollAccountantLive.com not only provides the necessary tax forms, we fill them out for you. You can look in the Taxes & Forms tab or click the name of the form on the To Do list. Often you can just print the form from the PayrollAccountantLive.com site, sign it, and send it to the address we provide. (Some jurisdictions require that you use original, scannable forms. In these cases, PayrollAccountantLive.com provides a worksheet to make it easy for you to copy your information to the original form. The worksheet provides the exact data you need to enter on each line of the form.)

In some localities, employers must file local tax forms (with school districts, health agencies, cities, or counties). PayrollAccountantLive.com does not supply local tax forms.

Q. When do I pay and file taxes?

A. PayrollAccountantLive.com sends you an email whenever a tax must be deposited or a tax report filed. Each tax agency establishes deposit schedules for employers based upon the size of the employer’s liability. Because you are a new employer, PayrollAccountantLive.com knows the deposit schedules that apply to you. In addition to the email, you’ll see your tax payments and filings on your PayrollAccountantLive.com To Do list. (State taxes are included with PayrollAccountantLive.com Payroll Plus only.)

Q. What is workers’ compensation insurance and do I need it?

A. Workers' compensation is a state-administered program to pay for injuries that occur in the course of employment. Workers’ compensation insurance is required for nearly all employers in all states. If you are a small business employer, consult your insurance broker.

It is very important that you have adequate workers’ compensation insurance. Otherwise, if your employee is injured on the job, you may be personally liable–not only for the cost of medical treatment, but also for disability payments during the period in which the employee is unable to work. You can find what is required in your state. The PayrollAccountantLive.com Resources/Federal Government Resources page provides a link to the state table on the Office of Workers’ Compensation Programs Web site.