endorsing and SS.......a big question!

[stoneFree]

Perhaps it might help to look at the typical American small business from inception. Let's say you have a business idea to make the world a better place and make money too. You start a COMPANY, defined as a group of people working together as one for a common goal. You lease some space, hang a shingle, and hire 3 people to help. You have some questions on banking & payroll, Can I use my own bank account or start a new one? Should I do payroll in-house? How? You decide to ask for some help. Business consultant says you need to apply for a federal employer ID number (EIN). Your brother-in-law the tax preparer says you should start a new bank account using that EIN. Finally you confer with that attorney cousin who says your employees should sign Form W4. You think to yourself, are these optional or required? Invariably they all answer similarly: "Yes you havta. Everybody does it. It's just the way things are done!"

So you get an EIN, start a business bank account with it, and every employee signs a W4. You buy some bookkeeping software that calculates deductions based on the W4 info and pay everyone what the computer says. It deducts 3 federal items: Social Security & Medicare (employment taxes) and Fed Withholding (income tax). You then file the W4s away in a cabinet never to see the light of day again. You make regular payments of withheld deductions, plus company contributions of employment taxes, to the US Treasury. At years end you prepare Forms W2 for every employee and send a copy of each to the SSA attached to one Form W3 signed by you under penalty of perjury. These are the rules according to the so-called "experts" so you follow them.

What just happened? Did you bolt upright in the middle of the night saying: My God, what have I done?

to be continued.....