The Burden on Business Owners Is Heavy When Not Using a PEO

There are a laundry list of things you must do as a business owner, should you opt out of using a professional employment organization. Some of the things you must do, in order to protect your legal standing as an employer are:

Establish Applicable State Income Tax Withholding Account(s).

If you are not outsourcing your Human Resources and administrative task by using a Professional Employer Organization (PEO) then you have responsibility for making the tax withholding and deposits for employees in each state where you have employees. View tax withholding requirements in your state .

Establish your Federal Unemployment Tax (FUTA) Calendar and Establish Deposit Accounts.

Use the IRS Tax calendar to establish your payment schedule. Use Form 8109 when you make your tax deposit at an Federal Reserve Bank for your area or another authorized institution. Calculate amounts (based on per period employee wages) and make payments per the schedule rules for your size company. See IRS Instructions for Form 940 - Employer's Annual federal Unemployment Tax Return for detailed instructions.

Establish your State Unemployment Tax Account - (SUTA).

When your company has employees, it has an obligation to contribute to the state Unemployment Insurance fund for each state where you have employees. Amounts are charged based on a percentage of each employee wages up to a capped wage amount. Amounts vary based on your state and your company's experience with your states UI system. View information about SUTA rates for new businesses . You will need to find your states unemployment insurance (SUTA) regulatory body and get instructions for establishing your account, determining your rating and making your quarterly payments. Most states now require employers with over 50 employees to file electronically. Click here to view a list of State Unemployment Insurance resources for your state .

Acquire Workers' Compensation Insurance Coverage.

Determine risk type for workers (workers compensation classifications) and shop for a Workers’ Compensation insurance policy. Purchase Workers' Compensation coverage and pay up front for at least six months of coverage. Learn about how workers' compensation insurance coverage is priced and how your coverage needs are based on the type of work being performed and the number of people you employ. In addition learn how your work comp claims will affect your work comp modification factor (also known as your experience rating or mod rate) which in turn affect the price you will pay for your policy. Visit this link for more information about the Workers' Compensation Insurance regulations in your state.

And that's just a partial list of the things you as a business owner (big or small) are responsible for when not using a professional employment organization. A PEO can alleviate much of the worry, and actually save you time and money in the long run.