Businesses with employees

As a business owner, when another person performs work for you, you must first correctly classify that person as an independent contractor or employee.

• If the person is classified as an independent contractor, then refer to Forms and associated taxes for independent contractors for your tax responsibilities.
• If the person is classified as an employee, then you must have an employer identification number (EIN). Your tax responsibilities include withholding, depositing, reporting and paying employment taxes. You must also give certain forms to your employees, they must give certain forms to you, and you must send certain forms to the IRS and SSA.

For further guidance on whether a worker is an independent contractor, or an employee refer to the following IRS articles Worker Classification 101: employee or independent contractor or Topic no. 762, Independent contractor vs. employee or Publication or Publication 5520, How Businesses Determine if a Worker is an Employee or Independent Contractor PDF.

See the links below for additional information:

• Hiring employees
• Part time or seasonal help
• Employee benefits
• Family help
• Employment taxes
• Married couples in business
• Members of the clergy
• Paying yourself
• Recordkeeping requirements
• Employment tax recordkeeping
• Tax withholding estimator