Service charge reporting deadline postponed
Tuesday, December 18th, 2012
The Internal Revenue Service has given businesses an extra year to comply with new rules on how to treat service charges, until January 1, 2014. The new rules had been scheduled to take effect January 1, 2013, but the deadline was extended in response to public comments to allow companies time to make their accounting […]
Read More »Employee or independent contractor stakes rise
Thursday, November 29th, 2012
Employee or independent contractor? Sure, we understand that treating workers as independent contractors is easier in so many ways. If you are struggling with the question of which classification your workers fall under, it is more important than ever to consider the consequences if the government disagrees with your stance. This article in Forbes magazine […]
Read More »Court allows employer tax refunds on layoffs
Tuesday, October 30th, 2012
The Sixth District Court of Appeals, which includes Tennessee, has upheld lower court rulings that severance pay is not subject to FICA tax. Companies that had mass layoffs and offered severance pay packages should consider filing claims to refund those taxes before the statute of limitations runs and limits the opportunity. In March 2008, the […]
Read More »Act now to get tax credit for hiring a veteran
Tuesday, June 12th, 2012
Did you recently hire an unemployed veteran? Make sure you secure your tax credit now. The IRS provides this information: Employers that hired unemployed veterans during late 2011 and early 2012 had an expanded period to request the required certification for claiming the expanded Work Opportunity Tax Credit (WOTC). That expanded period ends on Tuesday, […]
Read More »Hire a veteran, get a tax break
Friday, February 10th, 2012
The IRS has provided new information (and paperwork!) about the newly-expanded tax credit for hiring veterans. The VOW to Hire Heroes Act of 2011, enacted Nov. 21, 2011, provides an expanded Work Opportunity Tax Credit (WOTC) to businesses that hire eligible unemployed veterans and for the first time also makes the credit available to certain […]
Read More »Employees paid as independent contractors
Friday, January 13th, 2012
A Knoxville company was paying its workers as independent contractors. It was forced to pay back wages to its workers by the Department of Labor, who determined that they were actually employees subject to minimum wage and overtime laws. The news hit the local paper, no doubt as a warning to other businesses who may […]
Read More »New 1099 trap
Tuesday, January 10th, 2012
Business tax returns for 2011 contain new questions about Form 1099 that may trap you if you overlook issuing 1099s this January. The questions appear on Form 1040 Schedules C (sole proprietorships), E (rental), and F (farms). They also appear on partnership (1065) and corporate (1120 and 1120S) returns. The questions: Did you make any […]
Read More »Payroll tax cut extension with a lump of coal
Thursday, January 5th, 2012
Congress extended the payroll tax cut for sixty days after weeks of posturing. The 2% reduction in Social Security tax withholding will continue to put a little extra money in employees’ pockets through the end of February 2012, but Congress threw in a lump of coal with its Christmas gift. If you earn too much […]
Read More »Worker classification crackdown coming
Wednesday, October 26th, 2011
The IRS recently announced a voluntary worker classification program that provides amnesty from back payroll taxes and penalties for companies who reclassify their independent contractors into employees. While there may be advantages on the federal tax side of this issue, you must consider other factors before deciding on a course of action. Worker classification has […]
Read More »IRS abates penalties
Monday, April 4th, 2011
In a payroll tax case we have been working on for over a year, the IRS has agreed to abate penalties, saving the taxpayer over $200,000. This is a very unusual decision for the IRS, which considers non-payment of payroll taxes to be an unauthorized loan of government funds. Employers are required to withhold income […]
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