What Texas employers file
Texas has no state income tax, so there is no state withholding. Federal payroll tax and Texas unemployment tax still apply.
| Filing | Who it goes to | When |
|---|---|---|
| Federal tax deposits | IRS, through EFTPS | Monthly or semiweekly, depending on your deposit schedule |
| Form 941 | IRS | Quarterly: April 30, July 31, October 31, January 31 |
| Form 940 (FUTA) | IRS | Yearly, by January 31 |
| W-2s and W-3 | Employees and the Social Security Administration | By January 31 |
| 1099-NEC | Contractors and the IRS | By January 31 |
| Unemployment tax wage report | Texas Workforce Commission | Quarterly, by the end of the month after the quarter |
| New-hire report | Texas Attorney General | Within 20 days of hiring |
What we do
- Set up payroll correctly: Form W-4 for each employee, your EIN and EFTPS enrollment, your TWC account
- Calculate pay, withholding and employer taxes each pay period
- File Form 941, Form 940 and the TWC quarterly reports
- Prepare W-2s for employees and 1099-NEC forms for contractors at year-end
- Record payroll in your books so the wage accounts reconcile
Employee or contractor?
Calling a worker a contractor when the IRS would see an employee can lead to back payroll tax and penalties. If you are not sure how to classify someone, ask us before the first payment.
Questions
Do Texas employers withhold state income tax?
No. Texas has no state income tax. You still withhold federal income tax, Social Security and Medicare, and pay Texas unemployment tax to the TWC.
Do you handle S corporation owner salaries?
Yes. An S corporation owner who works in the business is paid through payroll, and we set that up with the rest of your payroll.
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