We previously reported that new and very onerous requirements would be added beginning in 2012 for business 1099 reporting. We thought at the time that the law looked likely to be repealed and indeed it has been repealed.
According to the IRS website: The Comprehensive 1099 Taxpayer
Protection and Repayment of Exchange Subsidy Overpayments Act of 2011
eliminated new information reporting requirements that were created by
previous legislation. You can read it at the IRS website.
The relevant part is that only existing information reporting
requirements remain in effect ie: Payments of $600 or more for
nonemployee compensation made in the course of a trade or business are
generally required to be reported on Form 1099-MISC. Certain payments to
corporations are required to be reported. See the Instructions for Form
1099-MISC for more information.
Good news for small business owners!
States are continuing to increase their efforts to collect Use Tax
on items that individuals buy from out of state sellers. When an
individual buys stuff on the internet or mail order and the seller is
from another state Sales Taxes are often not paid by the buyer or
collected by the Seller. For many years, despite the law in many states,
people have considered it to be a discount. Enforcement still seems to
be a problem for the states but they are getting more and more active
because of the increase in on line purchasing. You might have noticed
that for the last few years I and other Tax Preparers have been
routinely asking abut out of state purchases. This is just something to
keep in mind. Any perceived discount for out of state buying is really a
bit of a risk. Here is what California Hs to say About it.
The IRS has two programs that provide tax preparation assistance for free.
One of them is for people who have income below $49,000.00 and the
other is for people over 60. It is a shame that the tax laws are so
complex that people need help at all, but they are.
We just want people to know that they do not necessarily have to pay a professional for help.
Continue reading “You may be eligible to receive Free Tax Help”
Another provision of the Small Business Jobs Act of 2010 removes cell phones from listed property so their cost can be deducted or depreciated like other business property, without onerous record-keeping requirements.
This is good new for small business owners who probably were not
meeting the requirements of the law anyway and even better news for
those that were doing the paperwork. It is nice to see any small steps
toward making it easier to have a small business in America.
You can still get IRS tax Forms by mail.
Call 1-800-TAX-FORM (800-829-3676)
You can order current year forms, instructions and publications as well as prior year forms and instructions.
The IRS says that you will receive your order by mail, usually within 10 days.
Another New Tax law change that benefits small business is the Small Business Health Care Tax Credit which takes effect now.
In simple terms this will allow some small
businesses who pay for health insurance for their employees to save on
taxes. While not a benefit to all small businesses it will help some and you should know about it.
Continue reading “Small Business Health Care Tax Credit”
The Bad News is that the IRS is requiring businesses that could previously make Federal Tax Deposits by coupon to now use other methods.
The Good News – for those that find the web based
and other systems too complicated and time consuming – is that you can
make your deposits by telephone.
Continue reading “Have you been using Tax Deposit Coupons – Form 8109?”
The burden placed on small businesses and start-ups just keeps getting higher and higher.
Beginning in 2012 businesses will have to issue 1099 tax forms not just to contract workers but to any individual or corporation from which they buy more than $600 in goods or services
in a tax year. These changes will cause businesses to have to track
many more of their transactions and issue many more forms – if they stand.
This will hugely increase the number of 1099s issued each year and
massively increase the paperwork required to track these transactions
because it adds both corporations and goods.
Under this new law you will be required to issue a 1099 to companies
such as Costco and Smart & Final, and all other vendors for items
purchased for resale.
This provision is beginning to be noticed by more and more people in
the small business community and will hopefully be reconsidered.
Good news for business owners who bought equipment in 2010 or want to buy new equipment in 2011 and want to expense it fast. The Sec 179 limit was increased to 500K for
2010 and 2011 by the The Small Business Jobs Act of 2010. This can
really help defer taxes for businesses that are otherwise profitable
even though they spent on depreciable equipment.
Here is what the IRS said about the new law:
Continue reading “First year depreciation dedution increased to 500K”
Some people who are affected by the last minute tax law changes or who itemize deductions will have to wait until mid to late February to file to give the IRS time to adjust.
Here is the list of areas with changes that will require waiting:
Continue reading “Taxpayers affected by late tax breaks should wait to file”