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It’s almost tax time! Tips to Streamline Your Year-End Processes.
It’s December already and we wanted to provide some helpful reminders in order to help you streamline your year-end and tax return processes for 2011.
S-Corp Owners Health Insurance Reportable on W-2 – From the IRS: “Heath and accident insurance premiums paid on behalf of the greater than two percent S corporation shareholder-employee are deductible and reportable by the S corporation as wages for income tax withholding purposes on the shareholder-employee’s Form W-2. These benefits are not subject to Social Security or Medicare (FICA) or Unemployment (FUTA) taxes. The additional compensation is included in Box 1 (Wages) of the Form W-2, Wage and Tax Statement, issued to the shareholder-employee, but would not be included in Boxes 3 and 5 of Form W-2.”
For more information, including information about sole shareholder/employee situations, please see: http://www.irs.gov/businesses/small/article/0,,id=203100,00.html
NC County Business Property Tax Listings – “Any individual(s) or business(es) owning or possessing personal property used or connected with a business or other income producing purpose must file a county business property listing by January 31, 2012 unless an extension is filed.” For more information on registering for an account and to obtain forms for filing, please visit the following county Triangle, NC County websites as they apply to you.
Wake County – http://www.wakegov.com/tax/forms.htm
Durham County – http://www.co.durham.nc.us/departments/txad/Business_Personal_Property_Taxation.html
Orange County – http://www.co.orange.nc.us/assessor/BusinessPersonalProperty.asp
NC Employment Security Commission Notices – NC ESC will be sending out notices through the end of the year to address any changes in your unemployment insurance rate for 2012. Be sure to provide these to your payroll service provider to update their systems.
1099 Forms Due 01/31/12 – If you have paid or will pay subcontracted vendors more than $600 in non-employee compensation in tax year 2011, you will need to have a W-9 form on file for each of them in order to issue their 1099 form. The W-9 form will allow you to obtain the information needed to determine 1099 eligibility, their taxpayer ID number, and a current address for mailing. The deadline to submit 1099 forms to the taxpayer is January 31st and the deadline to submit to the IRS their copy is February 28th. Failure to file on time can result in penalties.
The W-9 form can be downloaded here: http://www.irs.gov/pub/irs-pdf/fw9.pdf.
Please also see the following IRS Publication http://www.irs.gov/pub/irs-pdf/i1099msc.pdf.
IRS Virtual Tax Workshop – If you would to obtain more information about your tax requirements, the IRS offers a free virtual workshop for small business owners and self-employed individuals at http://www.irsvideos.gov/virtualworkshop/
Three Tips for Employers Outsourcing Their Payroll
Three Tips for Employers Outsourcing Their Payroll Special Edition Tax Tip 2011-05, September 2, 2011 via IRS.GOV
Outsourcing payroll duties to third-party service providers can streamline business operations, but the IRS reminds employers that they are ultimately responsible for paying federal tax liabilities. Recent prosecutions of individuals and companies who – acting under the guise of a payroll service provider – have stolen funds intended for payment of employment taxes makes it important that employers who outsource payroll are aware of the following three tips from the IRS:
Employer Responsibility – The employer is ultimately responsible for the deposit and payment of federal tax liabilities. Even though you forward the tax payments to the third party to make the tax deposits, you – the employer – are the responsible party.If the third party fails to make the federal tax payments, the IRS may assess penalties and interest. The employer is liable for all taxes, penalties and interest due. The IRS can also hold you personally liable for certain unpaid federal taxes.
Correspondence – If there are any issues with an account, the IRS will send correspondence to the address of record. The IRS strongly suggests you do not change the address of record to that of the payroll service provider. That could limit your ability to stay informed of tax matters involving your business.
EFTPS – Choose a payroll service provider that uses the Electronic Federal Tax Payment System. You can register on the EFTPS system to get your own PIN to verify the payments.The IRS web site – http://www.irs.gov has more information on the responsibilities of employers outsourcing payroll, payroll service providers and EFTPS.
via Three Tips for Employers Outsourcing Their Payroll.
for more information about online payroll services: www.netWorthPayroll.com
IRS Urges Nonprofits to Continue to File e-Postcards
IRS Urges Nonprofits to Continue to File e-Postcards
Beginning in 2010, nonprofits that don’t file Form 990, Form 990-EZ, or Form 990-N with the IRS for three consecutive years automatically lose their tax-exempt status. These filings are due 5 ½ months after the end of nonprofits’ fiscal years (for example, May 17, 2010 for nonprofits with fiscal years ending December 31 and November 15, 2010 for those whose fiscal years end June 30). The IRS Commissioner issued a statement this week encouraging small nonprofits that missed the May 17 deadline to still file a Form 990-N (e-Postcard) as soon as possible. The IRS will try to work with nonprofits that file their e-Postcards late.