• You will have to withhold Federal Tax, Social Security, and Medicare. You will also have to deposit the withholding with the government. If you do not, there will be substantial penalties and interest. I use this software for my 2 employee business: It is amazingly cheap for what it does. If you can afford it I recommend it absolutely. Get a free account with to make deposits to the government online directly from your business checking account. This will take some time to set up. It may be too complex or time-consuming for many people. If you have any doubts please find an accountant that can handle this for you. Remember that you will have to pay income tax, Medicare and Social Security for the money that you keep as well. Ouch!!

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