3. March 2012 by admin.

Some companies prepare 1099’s for everyone eventhough it may not be required. If you paid any individual more than $600 for personal services, then a 1099 is required (that includes paying an unincorporated landlord).

When we say individuals, that may be confusing. Clearly if you wrote the check to JONES, INC, that is a corporation but I’d get a W9 just in case.

Your vendors should complete a Form W9 available on irs.gov or click here http://www.irs.gov/pub/irs-pdf/fw9.pdf?portlet=103. THIS tells you what you need to know to determine whether a 1099 is required.

You do not have to do 1099’s for C Corps, S Corps, Partnerships or Trusts/Estates.

You also do not have to do 1099’s for LLC’s if they are taxed as a C, S or partnership.

You should have a W9 on file for each of your vendors to determine if a 1099 is requried.

So, if Individua/sole proprietor, or LLC without a tax classification is checked, then YES to do 1099.

As long as you are doing any, you should have a RECIPIENT’s identification number completed, else IRS may send a penalty notice.

The RECIPIENT’s identification number is usually the social security number but may be the federal ID# of a sole member LLC.

Clear as mudd? I doubt it. Been doing this for over 25 years and I’m still confused!

Posted in International Taxation, Sub S Corporations, LLC's, Income Tax, General | 1 Comment »

22. February 2012 by admin.

You don’t buy or sell a business.

You buy or sell either

Ownership position in a corporation is evidenced by Stock.  It is like selling stock in a publically traded corporation.  The business is not selling assets.  The ownership of the business changed but not the assets nor the liabilities.  The new owners just operate the business with the same federal identification number.  Everything is the same but with new owners. 

The above also applies to selling ownership interest in a non-disregarded entity (multiple member LLC or partnership). 

Assets are sold.  The business accounts for profit or loss based on the allocation of purchase price to the fair market value of the equipment, inventory, receivables, goodwill and non-compete (and maybe a few other things).  Point is ASSETS were sold by the business.  The ownership of the business did not change.  The tax differences to the buyer and seller are different and often at odds.  What is best for the seller may not be best for the buyer. 

We often see new clients who… “sold a business”.  Once we discover the underlying facts we have often found a significant after tax difference based on what was actually sold.

Posted in International Taxation, Sub S Corporations, LLC's, Income Tax, General | 1 Comment »

1. February 2012 by admin.

Florida

Contribution Rates
For 2012, the minimum rate is 2.02% and the maximum rate is 5.4%, except that employers participating in the short-time compensation program will be subject to a maximum rate of 6.4%. New employers pay 2.7% in 2012. The noncharge ratio is .0057, the excess payment ratio is .0089, the gross benefit ratio is .0275, the multiplier is 1.1382, the fund size ratio is .0167, and the final adjustment ratio is .0313. There also will be a special tax assessment in effect for 2012 to assist in repaying the interest on the state’s Title XII loan, but that amount is not available yet. (DEO Communication.)

Posted in International Taxation, Payroll Tax, Sub S Corporations, LLC's, Income Tax, General | 1 Comment »

21. January 2012 by admin.

Posted in International Taxation, Payroll Tax, Sub S Corporations, LLC's, Income Tax, General | 1 Comment »

17. January 2012 by admin.

The 2012 federal mileage rates for the use of a car (also vans,

pickups or panel trucks) will be:

• $0.555 per mile driven for business purposes

• $0.23 per mile driven for medical or moving purposes

• $0.14 per mile driven in service of charitable organizations

Posted in International Taxation, Sub S Corporations, LLC's, Income Tax, General | 1 Comment »

11. January 2012 by admin.

There were approximately 4,430 changes to the tax code from 2001 through 2010, an average of more than one a day, including an estimated 579 changes in 2010 alone. 

Posted in Payroll Tax, Newsletter Topics, Retirement Accounts, International Taxation, Sub S Corporations, Income Tax, LLC's, General | 1 Comment »

26. December 2011 by admin.

A 2-Month Extension to the Payroll Tax Cut Signed

Friday, December 23, 2011 a 2-month extension of the payroll tax cut was signed. This means the employee social security rate will remain at 4.2% through February 29, 2012. Paycor has updated the tax rate to 4.2% for January and February 2012. We continue to closely monitor this legislation and will relay any additional updates.

Posted in Payroll Tax, International Taxation, Sub S Corporations, LLC's, Income Tax | 1 Comment »

27. November 2011 by admin.

• If you are like me and cannot attend all the games,  and you give the tickets away to a client or potential client, you have a choice:

Posted in International Taxation, Newsletter Topics, Sub S Corporations, LLC's, Income Tax, General | 1 Comment »

19. October 2011 by admin.

IRS statistics now available for 2009 tax returns.

The highest earning 1% of all U.S. individual taxpayers paid 36.7% of all federal income taxes.

The highest earning 5% paid 58.7%.

The bottom 50% paid only 2.25% of total federal income tax.

Posted in Newsletter Topics, Retirement Accounts, International Taxation, Sub S Corporations, Income Tax, LLC's, General | 1 Comment »

5. September 2011 by admin.

The Job Creation and Worker Assistance Act of 2002 (JCWA) provided an additional depreciation deduction in the placed-in-service year that is equal to 30% of the adjusted basis of the qualified property placed in service after 9/10/01. This law is reflected (for the most part) in IRS Code section 168(k).

The Jobs and Growth Tax Relief Reconciliation Act of 2003 (JGTRRA) amended the bonus depreciation provisions of the Job Creation and Worker Assistance Act of 2002. For qualified property placed in service between 5/6/03 and 12/31/04, the bonus depreciation increased from 30% to 50%.

The Economic Stimulus Act of 2008 allows 50% bonus depreciation for qualified property placed in service between 1/1/08 and 12/31/08.

The American Recovery and Reinvestment Act of 2009 allows 50% bonus depreciation for qualified property placed in service between 1/1/09 and 12/31/09.

The Small Business Jobs Act of 2010 allows 50% bonus depreciation for qualified property placed in service between 1/1/10 and 12/31/10.

The Tax Relief Act of 2010 allows 100% bonus depreciation for qualified property placed in service between 9/9/10 and 12/31/11 and 50% bonus depreciation for qualified property placed in service between 1/1/12 and 12/31/12.

Posted in International Taxation, Newsletter Topics, Sub S Corporations, LLC's, Income Tax, General | 2 Comments »