Have you heard the latest version of the age-old story:
"The Tale of Two Small Business Owners."
Here it is:
Small Biz Owner #1 is 31 times less likely to be penalized
by the IRS than Small Biz Owner #2.
Hmmm. What gives What is the difference between these two
chaps
It's simple, really.
Small Biz | | Owner #1 makes his federal tax payments
electronically, using the government's Electronic Federal
Tax Payment System (aka EFTPS).
Small Biz Owner #2 makes his federal tax payments manually,
using good old paper 'n ink to write the check.
Not only that, but for his monthly payroll tax payments,
Small Biz Owner #2 has to fill out the little coupon that
comes in that little yellow coupon book (known as Form
8109), write out the check, and then take the time to visit
his local bank and make the payment in person.
Because Small Biz Owner #2 is stuck in the rut of the
manual check payment routine, he is 31 times more likely
to get hit with a late-payment penalty.
And these late payment penalties are pretty steep:
1 to 5 days late = 2% penalty
6 to 15 days late = 5% penalty
16 or more days late = 10% penalty
. . .plus interest.
It makes sense, doesn't it If a task takes less time
and energy to complete, you are more likely to do it
on time.
And using EFTPS definitely is easier and faster than
writing out a check and taking it to the bank.
You simply sit down and make a 5-minute phone call, or
visit the IRS website and input a few numbers.
No fuss, no muss. And you can do it 24 hours a day, 365 days
a year.
I know, I know. Change is painful. You like your routine.
My 3 children like to tell me how "old-fashioned" I am --
because of the clothes I wear or the music I listen to.
I hear it all the time:
"You're so '20th century', Dad."
Well, I'm hear to tell you . . . making your tax payments
with a manual check is soooo "20th century", man.
Get with the times and start using EFTPS.
Not only is it "hip, man" -- but it can also help you
avoid a hefty late payment penalty.
One of my clients with a staff of 4 employees
recently forgot to make one of his monthly federal
payroll tax payments. During my quarterly review
of his books, I informed him of the missing payment.
On a tax liability of just $2,000, he was now faced
with a $200 penalty. Ouch!
Ready to join the 21st Century, and avoid the pain
of an unnecessary tax penalty
Sign up for EFTPS by visiting:
http://www.eftps.gov or call (800) 555-4477.
About The Author
Wayne M. Davies is a Tax Professional serving small business
and self-employed clients in Fort Wayne, Indiana. Wayne has
been helping his clients reduce their taxes for the past 15
years. Wayne provides a complete line of accounting,
payroll and tax preparation services for all business types:
sole proprietorships, partnerships, c |
| | serving small business
and self-employed clients in Fort Wayne, Indiana. Wayne has
been helping his clients reduce their taxes for the past 15
years. Wayne provides a complete line of accounting,
payroll and tax preparation services for all business types:
sole proprietorships, partnerships, corporations and LLC's.
He is author of the new eBook, "The Tax Reduction Toolkit:
29 Little-Known Legal Loopholes That Will Reduce Your Taxes
By Thousands (For Small Business Owners and Self-Employed
People Only!), available at
http://www.YouSaveOnTaxes.com/toolkit.html.
Wayne also publishes two bi-weekly eZines: "Make My Life Less Taxing",
available at http://www.YouSaveOnTaxes.com; and "Small
Business Owner/Smart Business Owner", available at http://www.MagneticMarketing.biz.
This article was posted on February 23, 2006 |
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