Mar
My mothers restauarnt has been doing quite well, often so busy its overwhelming. However, twice a month she’s being charged taxes, state and federal, medicaid, social security etc and it amounts to almost a thousand dollars a month. Combine that with payroll, rent, groceries, and all the other expenses it is draining her bank account each month to the point that we're not sure if we can keep the restaurant open.
Its only 3 months old and this seem so strange. How can small businesses survive being taxed so heavily?
Are we being screwed (why, yes we are) but it is someone taking advantage or is this just normal government screw you?
Are their alternatives to paying these taxes monthly as she is.
I would really appreciate any advice. Its such a great restaurant and I cna't believe its on the brink of closing because of Uncle Sam.
Thank You!
Answer:
Based on the info you provided, sounds like you’re speaking about sales taxes and payroll taxes. Not sure what you mean about being charged twice a month, as sales tax and payroll taxes are usually paid monthly, unless the business had a huge payroll. Basically yes, you have to pay these taxes are required by the say and the IRS. If you don’t pay them as required, the say and the IRS can close the business due to non payment. Believe me, if she is having trouble paying them now, envision how hard it would be if she got behind, plus she would incur penalties and interest for last payment. Then she would owe even more. Hopefully you mom has a good bookkeeper or accountant to be sure is handling everything correctly. irs.gov has great info for for small business owners.