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is levied on all businesses employing
eight or more persons.
A. Old-Age and Survivors Insurance.
-—At the present time the old age and
survivors tax which you must pay as an
employer is equal to one and one-half
percent of the first $3,600 in wages ac-
tually paid during the year to each em-
ployee, plus an additional one and one-
half percent which you, as employer,
must withhold from the employee's
wages. The new law calls for gradual
increases in social security tax rates
until 1970, when the combined contri-
butions of employer and employee will
equal six and one-half percent of the
employee's wage.
Social Security Forms
The social security taxes which you
withhold from your employee's wages,
together with your own contributions
and the withheld income taxes of your
employees, must be reported on Form
941 to the Collecter of Internal Revenue
for your district and paid quarterly on
or before the last day of the month fol-
lowing the end of the business quarter.
Your contribution to the social security
tax on behalf of your employees is de-
ductible from your income tax.
B. Social Security Tax for Self-Em-
ployed Persons. — Self-employed per-
sons who have income from trades or
businesses which they operate as sole
owners or partners, or through agents,
are now part of the social security sys-
tem. Also included are independent
contractors, such as construction con-
tractors, lessee-miners, and taxicab and
truck drivers who have control over
BAUER BENCH CO.
INCORPORATED
A N N O U N C E S
THAT
ITS OFFICES
ARE N O W AT
85 BEECHWOOD AVENUE
NEW ROCHELLE, N. Y.
Tel.—NEw Rochelle—2-4054
their own hours and operations, own
their own equipment, work for flat fees
or commissions, or fulfill other condi-
tions indicating that they operate with
only nominal supervision from an em-
ployer. If you are self-employed, and
have minimum net yearly earnings of
$400, they must be reported. The maxi-
mum net yearly earnings (together with
wages, if you are also a wage-earner)
which can be credited to your social
security account are $3,600.
Self Employment Tax
Since, as a self-employed individual,
you are in the position of both em-
ployer and employee, you must report
your own self-employment income and
remit the entire contribution on your
insurance. The self-employment tax
will be paid once a year as part of the
regular income tax. It will not affect
estimated income tax in any way. It
will not have to be estimated or paid
before its due date. From 1951 through
1954 the rate is two and one-fourth per-
cent. Provision has been made in the
law for periodic increases in rate until
a maximum of four and seven-eights
percent has been reached in 1970. That
rate will continue to apply thereafter.
The subject of social security for the
self-employed is more fully covered in
Small Business Aid No. 518, "What the
Amended Social Security Act Means to
the Self-Employed," which is available
on request to the Department of Com-
merce or its field offices.
C. Federal Unemployment Compen-
sation Tax.—The Federal unemploy-
ment compensation tax is not likely to
apply to most new small businesses,
since a business with fewer than eight
employees is exempt from the tax. The
tax is equal to three percent on the first
$3,000 of wages for each employee, and
is paid entirely by the employer in all
states except Alabama and New Jersey.
The Federal Government keeps only a
small part of the revenue to cover ad-
ministrative expenses, giving a mini-
mum of 2.7 percent of the tax to the
businessman's State.
D. Helpful Publications on Social Se-
curity Taxes.—A booklet which you
GRANDS (as is) from $150 up
STUDIOS (as is) from $225 up
UPRIGHTS (as is) from $25 up
A choice selection always available
(Next Month—State Toys)
and the
MINI-CHIMES
BRODWIN PIANO CO., Inc.
THE MUSIC TRADE REVIEW. FEBRUARY, 1952
Federal Manufacturers' Excise
Taxes
The Federal Government levies a
number of taxes upon the manufacture
of certain selected commodities, many
of which are produced by small busi-
nesses. These commodities include
sporting goods (practically all types
except baseball equipment, children's
skates, and sleds and toboggans under
60 inches long), refrigerators, deep
freezes and air conditioning equipment.
However, component parts for refrig-
erators, when sold by the manufacturer
to another manufacturer or producer of
refrigerating equipment, or to a vendor
for resale to a manufacturer, are not
taxed. The manufacture of radios, tele-
vision sets, phonographs and musical
instruments is taxed, but not if they are
sold to religious and educational insti-
tutions. Nearly all electric, gas and oil
appliances are subject to a manufactur-
ers' tax, including most household elec-
tric appliances.
CARILLONETTE CHIMES
TOWER BELL REPRODUCER
WRITE — WIRE —
OR — PHONE — CHELSEA 2-4350
Est. 1974 — HARRY BRODWIN, Pres.
246 WEST 23rd STREET
The Department of Labor also has
issued for employers a useful bulletin
which summarizes Federal labor laws
and describes the labor agencies. This
is "Federal Labor Laws and Agencies,"
(Bulletin No. 123), 99 pages, published
in August 1950, and available from the
Government Printing Office, Washing-
ton 25, D. C, for 50 cents.
BEACH
USED PIANOS —
'
will find useful as an employer is the
"Employer's Tax Handbook," prepared
by the Bureau of Internal Revenue.
This is a summary of regulations gov-
erning the withholding and payment of
income, social security, and unemploy-
ment compensation taxes. Detailed in-
structions are given for reporting and
paying employer and employee social
security taxes. Tables of wage deduc-
tions at different levels also are includ-
ed. The pamphlet is revised to conform
to new revenue laws as passed and is
available from the Bureau of Internal
Revenue, Washington 25, D. C , from
district offices of the Collector of Inter-
nal Revenue, and from branch offices of
the Social Security Administration.
NEW YORK. N. Y.
"Nothing But a Bell Rings Like a Bel!"
SEND FOR CATALOGS
BEACH INSTRUMENT CORP.
165 Oraton St.
Newark 4, N. J.
27