How you classify your workers – as "independent contractors" or "employees" – matters a great deal to the IRS. The IRS is aware that employers prefer to treat workers as independent contractors to avoid paying fringe benefits and payroll taxes. The IRS estimates that 80% of workers who are classified as independent contractors are actually employees. About 100 new auditors have been hired with the specific task of investigating misclassifications, and the government is estimating that the crackdown will generate at least $7 billion in revenue over the next ten years. For guidance in classifying your workers, contact our office at (518) 798-3330.
Thursday, July 30, 2015
Wednesday, July 29, 2015
The IRS website contains useful information on how to avoid becoming a victim of identity theft, plus steps to take if you do become a victim.
Here are the warning signs that you may have had your identity stolen:
1. The IRS notifies you that more than one tax return was filed using your social security number.
2. You're notified that you owe additional tax or you've had collection actions taken against you for a year you did not file a tax return.
3. IRS records indicate you received wages from an employer unknown to you.
If you become a victim, the IRS recommends that you take the following steps:
1. File a police report.
2. File a complaint with the FTC.
3. Contact one of the three credit bureaus to place a fraud alert on your account.
4. Close any financial accounts opened without your permission.
5. Respond immediately to any IRS notice, according to the instructions given.
6. Complete IRS Form 14039 "Identity Theft Affidavit."
7. Continue to pay your taxes and file your tax return, even if by paper.
Monday, July 27, 2015
A new law, the "Don't Tax Our Fallen Public Safety Heroes Act," was signed on May 22, 2015, to clarify the tax treatment of federal and state benefits for public safety officers killed or injured in the line of duty. Under the law, such benefits will not be subject to federal income tax.
Thursday, July 23, 2015
In a survey of small businesses conducted by the National Small Business Association, 59% of respondents said taxes were more of an administrative burden than a financial one. Most businesses put payroll taxes at the top of the list of taxes with the greatest administrative burden. Payroll taxes also outranked other taxes, such as income, property, and sales taxes, as the top financial burden to businesses.
Monday, July 20, 2015
On June 25 the Supreme Court issued its ruling in the King v. Burwell case, holding that federal subsidies for health insurance could be provided whether the insurance was purchased through a state exchange or a federal exchange. Challengers to the ACA subsidies maintained that the law’s language allowed for subsidies only when insurance was purchased through a state exchange and not through a federal exchange. 34 states had not set up an exchange, relying instead on the federal exchange. Subsidies offset the cost of health insurance for low and moderate income people who aren’t covered by an employer’s plan, Medicaid, or Medicare.