I took over my parents business with my brother. My brother is the employee. My parents paid him under the table for a few years. When I took over, they said it was OK to pay him like that, because he is family. After about a month of paying him the same way, I discovered that's not the case.
I had him fill out a w-4 form, and I'm trying to figure out what steps to take to get everything legal. This is what I'm going off of so far: https://www.sba.gov/managing-business/running-business/managing-business-finances-accounting/10-steps-setting-payroll-system and https://www.irs.gov/publications/p15/ar01.html#en_US_2017_publink1000294371 Seeing as I only have the one employee, I figured I would try running payroll myself. Do I just use the IRS withholding calculator to determine the amount to remove from his paycheck? What about the money I have already paid him last month under the table?