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MequonCPA
MequonCPA, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 2342
Experience:  CPA, Over 30 yrs experience w/individuals and small businesses. Masters in Tax.
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CPA,

This answer was rated:

CPA,
Hello mark,

Your question apparently did not post correctly. Can you please tell us what you need help with?

Customer: replied 8 years ago.
I have a one person business owner/one employee S. Corp. in Minnesota (myself). Am I required to pay "Unemployment" on my payroll at both the state and federal level? Would this change if I was a different business entity. (It seems foolish to pay this after so many years owning a business.)

I'm aware I can lower this amount by taking a percentage as dividends vs. salary.

In the event there is any exception to a one person business owner having to pay unemployment insurance please get me where and what forms I need to fill and send to government or my payroll service.

Thanks,
Mark

Dear XXXXX -

 

You are not required to pay MN unemployment on your wages. They are subject to federal unemployment. Additionally, if you choose exemption from MN unemployment you are subject to an additional 5.4% federal tax on your wages subject to federal tax.

 

You will need to determine your state rate and taxable wages and compare it to the potential federal tax to see which method costs less.

 

http://www.uimn.org/tax/FAQs/25percentFAQs.htm

 

See Part 3 of Form 940: http://www.irs.gov/pub/irs-pdf/f940.pdf

 

MequonCPA, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 2342
Experience: CPA, Over 30 yrs experience w/individuals and small businesses. Masters in Tax.
MequonCPA and 2 other Tax Specialists are ready to help you