Small businesses: Don’t neglect 1099-MISC and 1099-NEC filings

 Accounting & Taxation, Tax Tips  Comments Off on Small businesses: Don’t neglect 1099-MISC and 1099-NEC filings
Nov 012020
 

Penalties for failure to file 1099 documents (information returns) with the IRS and failure to furnish recipients with their copies have increased dramatically in recent years. In 2021, for small businesses (less than $5M in average annual receipts in the most recent three years), these penalties can run as high as $280 for failure to file plus $280 for failure to furnish – per document – up to a maximum penalty of $1,130,500 in the aggregate for each of these issues.

New for 2020 is the 1099-NEC to report non-employee compensation. This information was previously reported on 1099-MISC, but has now been split out onto a separate information return. Who must file 1099-NEC, and who must be furnished one? These are questions to ask of a qualified professional. Even individuals who own rental property may be subject to 1099-NEC (and 1099-MISC) reporting, depending upon circumstances.

If you have a payroll service, do not assume that 1099 preparation is included with your basic level of service! In most cases, your payroll service will be completely unaware of any subcontractors or others who must be furnished documents, and don’t expect your payroll service rep to be able to provide answers as to whom should be furnished a 1099.

Your checkbook management software likewise can’t provide any guidance for you in this regard.

Planning to do these internally? To be considered correctly filed, information returns must be complete and accurate. That means full names and addresses, ID numbers (TIN, SSN, etc.), amounts, and in the cases of forms W-2G, 1097-BTC, 1098, 1098-C, 1098-E, 1098-F, 1098-MA, 1098-Q, 1098-T, 1099-A, 1099-B, 1099-C, 1099-CAP, 1099-DIV, 1099-G (excluding state and local income tax refunds), 1099-INT, 1099-K, 1099-LS, 1099-LTC, 1099-MISC (excluding fishing boat proceeds), 1099-NEC, 1099-OID, 1099-PATR, 1099-Q, 1099-QA, 1099-R, 1099-S, 1099-SA, and 1099-SB, a valid telephone number providing direct access to an individual in a position to answer questions about the statement must appear somewhere on it. [N.B.: This is not a complete list of requirements. Please do not rely on this as any type of instruction guide.]

As a reminder, forms 1099-NEC are due out to recipients no later than January 31, and must be filed with the IRS no later than January 31, as well. Forms 1099-MISC are due out to recipients no later than January 31, and must be filed with the IRS no later than February 28. Extensions of time to file with the IRS are available (the first 30-day extension is automatic, but must still be submitted on Form 8809; a second 8809 may be submitted to request another 30 days), but there is no extension of time to furnish documents to recipients.

Generally, we prepare information returns for our business clients as part of our standard service portfolio. If you have a need for this service à la carte, we can surely discuss your needs. Contact us for more information.

Think twice before becoming an Uber Entrepreneur

 Accounting & Taxation, Tax Tips  Comments Off on Think twice before becoming an Uber Entrepreneur
Jul 022015
 

The allure of being your own boss is a strong pull for many to escape the traditional demands of a regular job. Recently, app-oriented companies (such as Uber, Washio, Postmates, Shyp, and others) have become popular ways for non-capitalized erstwhile entrepreneurs to enter the wide world of self-employment. Continue reading »

Things to consider regarding business service providers when closing accounts

 Accounting & Taxation, Tax Tips  Comments Off on Things to consider regarding business service providers when closing accounts
Sep 152014
 

Payroll services are great assets. As compliance becomes more and more a full time job, outsourcing this task to experienced providers has become a popular alternative to handling such matters in-house. A single penalty for a missed tax deposit can far exceed the cost of a good payroll service for an entire year.

Complications do arise, however, such as when starting up, switching from in-house to a provider, changing providers mid-year, or terminating a business mid-quarter or before W-2 season.

We recently had a situation where a client sold his business assets (but no the business). As his business entity no longer had payroll, he contacted the payroll provider to terminate his account (with no payroll to process and no income from further operations, it seemed a logical choice). Unfortunately, that left the final quarter’s payroll tax reporting undone, and us (as the accountants preparing the general ledger) unable to access his payroll data online.

While we can’t blame the service provider per se (the provider is not paid to maintain the data in the online portal or to provide any services whatsoever after the account is closed), the issue is that many clients seem to forget that even though payroll may have stopped after the first week of the payroll quarter, payroll returns will still be due following the end of the quarter, and year-end reports (Federal Form 940, at a minimum) and W-2’s (and W-3) will also be due the following January.

Most payroll service providers will require their clients to maintain accounts (even if no current payroll is being generated) for a nominal fee in order to prepare the quarterly and year-end reports, as well as the W-2’s, and clients should expect to likely pay a la carte for such reporting services, even if they were previously accustomed to a package deal (unless the provider offers a similar package for inactive employers).

As always, communication is key. In the case above, because we have an ongoing relationship with the payroll provider, we were able to obtain the reports necessary and get the dialog moving (again) between our client and the payroll provider to ensure that the reports will indeed be prepared for this year, and to obtain the data we needed to prepare the general ledger work in a timely fashion. It may be easy to mentally separate the roles of accountant and payroll service provider, but in truth, we both work together, complimenting each other’s service offerings, and a good accountant will strive to maintain a good rapport with the service provider to minimize the impact on the client of procedural and administrative matters.

John Wick: Chapter 2(2017)

 Tax Tips  Comments Off on John Wick: Chapter 2(2017)
Apr 232014
 

John Wick: Chapter 2(2017)


Quality : HD
Title : John Wick: Chapter 2
Director : Chad Stahelski.
Writer :
Release : 2017-02-08
Language : English.
Runtime : 122 min.
Genre : Thriller, Action, Crime.

Synopsis :
Movie ‘John Wick: Chapter 2’ was released in February 8, 2017 in genre Thriller. Chad Stahelski was directed this movie and starring by Keanu Reeves. This movie tell story about John Wick is forced out of retirement by a former associate looking to seize control of a shadowy international assassins’ guild. Bound by a blood oath to aid him, Wick travels to Rome and does battle against some of the world’s most dangerous killers.

John Wick: Chapter 2(2017)