Business owners, including the self-employed, have several obligations to the US Social Security Administration. Employers must report wages, deduct taxes under the Federal Insurance Contributions Act (FICA) from their employees’ pay, file information about withholdings to the Internal Revenue Service (IRS), and periodically deposit the money withheld.
For businesses that have been around for some time or larger companies, dealing with the Social Security Administration Agency is nothing new. But new business owners may be entering uncharted waters. Also, laws for the self-employed and restaurant owners with employees who are earning tips vary a little.
Fortunately, the technological age has made it is easier to access forms and information, saving you trips or phone calls to the Social Security Administration Offices. That leaves you time to take care of your business and saves you some stress.
It is important to know that:
- SSA paperwork is time-consuming and stressful for new business owners.
- Restaurant owners must depend on employees to honestly report tips.
- The self-employed have obligations to the SSA as business owner and employee.
Action Steps
The best contacts and resources to help you get it done
Take advantage of the official SSA Business Suite Online (BSO)
The SSA government site has extensive online services for business owners.
I recommend: The
BSO Suite of Services gives an overview of the services offered online. You can check submission and report status, acknowledge a notice requesting you to resubmit your wage file, verify social security numbers for employees, and more. Explore the BSO software with this trial
demonstration. If you like the tools the BSO has to offer, get started by
registering.
Learn strategies for keeping track of employees' tips
The SSA holds business owners accountable for accurately reporting tips and paying their portion.
I recommend: Review these three pointers from the
Restaurant Resource Group on reporting tips and paying your portion of FICA to the Social Security Administration Agency. Download IRS
Publication 1244. This PDF is a form, along with instructions, for keeping track of your employees’ daily record of tips. You can make copies of this form and keep it for tax purposes.
Get organized with a tax calendar and find answers to your questions on self-employment
The self-employed can avoid penalties by making FICA payments on time, and this IRS calendar gives you deadlines you need to remember.
I recommend: The IRS has put together a
calendar that you can download to your computer in order to help you remember important deadlines. The SSA also has helpful
answers to the most common questions that business owners have, including the self-employed.
Tips & Tactics
Helpful advice for making the most of this Guide
- All business owners can benefit from the BSO. Time is money, and you can spend your time better than waiting in the Social Security Administration Offices to get answers to questions, forms and reports that you can access online simply by registering.
- Check the frequently asked questions and BSO websites periodically for changes in laws, and sign up to receive emails when you register.
The official source of Social Security Administration (SSA) is
the Social Security Administration (SSA) page at Business.com
Related Resources from Business.com
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