This is an excerpt from our e-guide, "Avoiding Employee Misclassification with Independent Contractors." The complete — and FREE! — e-guide can be downloaded here.
Working with independent contractors can be a smart business practice. But you need to understand how to do it the right way. In the eyes of the IRS and Department of Labor (DOL), these workers must meet certain criteria that distinguish them from employees.
As the tax-filing season draws near, your attention will shift from other business priorities to assisting your clients with their 1099 tax information return filings. To get yourself and your clients prepared, you'll want to brush up on some important changes with the Form 1099-MISC and the new Form 1099-NEC.
There's a new tax form on the block, and it will change how business owners and tax professionals handle certain types of tax reporting for the 2020 tax year and beyond. Basically, the 2020 Form 1099-NEC replaces Form 1099-MISC for reporting nonemployee compensation (in Box 7), shifting the role of the 1099-MISC for reporting all other types of compensation.
If your company isn't currently e-filing your informational returns — you should be. Here's a rundown of the e-filing threshold changes the IRS has announced that will impact your business over the next couple of years as well as a timetable for when each becomes effective.
The 1099-NEC is the form that will be needed to report independent contractor payments for calendar year 2020. So who gets a 1099-NEC? Typically, this form is issued to independent contractors, janitorial services, third-party accounts and any other worker paid for services who is not on the payroll.
The rules surrounding whether a worker is an employee or independent contractor are certainly complex. Yet when a company misclassifies an employee as an independent contractor, it doesn’t properly withhold and pay payroll taxes … a costly oversight the IRS is cracking down on.
Ironically, the very reason employers misclassify workers as independent contractors – to save money – could cost them in the end. As a business owner, you need to understand the differences between an employee and an independent contractor, or risk paying back taxes and penalties for improper classification. Find out how the IRS is cracking down on this all-too-common problem and what it takes to get it right.
Independent contractor status is determined by several factors, which differ among the various government agencies and courts that enforce regulations. The rules can be complex, and they often overlap.
The IRS has released Form 1099-NEC, replacing Form 1099-MISC with box 7 data. In this article, we discuss the purpose of the two forms, their differences and filing requirements for each.
There's an old saying: "To err is human." Fortunately, if those errors are with your 1099 or W-2 tax forms, you have an easy path to correcting them.
Recruiting and hiring top employees for your small business can be challenging — especially when you’re competing against large, thriving companies who can offer more financial incentives.
Struggling to keep on top of required labor law postings? Consider this catchy 5-letter prompt to remember what, when and where to post: Post the Proper Posters Prominently, and Protect Them.
Want one less thing to worry about this tax-filing season? Take advantage of TIN matching to ensure accurate TIN/name combinations for payer and payee data. This is an important time- and money-saving service because incorrect TINs can result in form rejection – and potential $250 mismatch penalties from the IRS.
As businesses conduct more activities online, the need for sophisticated data security grows. What about e-filing your 1099s and W-2s? You know the process is convenient and affordable, but how can you be sure it’s safe, too?
Rarely does a week go by that you don’t hear on the news about a security breach. Companies such as Equifax, Facebook, Google, Target and the NSA all have had significant incidents with millions of records viewed, copied, corrupted or kidnapped and held for ransom.
With news of data breaches and identity theft dominating the headlines, you may question the security of e-filing. How can you be certain the sensitive information of your independent contractors and employees – including Social Security numbers and tax IDs — doesn’t fall into the wrong hands?
You've probably heard of working and storing information in the cloud, but did you know you can file your 1099s, W-2s and ACA forms in the cloud, too? That's right! Rather than muddle through manual processes or restrict yourself to installed software, you can manage your annual tax filing quickly and easily in the cloud. With the 2017 tax-filing season right around the corner, now is the time to explore all the perks of cloud-based e-filing.
No longer just the focus of sci-fi thrillers or global corporations, cyber security has entered the mainstream. Today, if you conduct any sort of business online, you need to care about data security.
Although the individual mandate no longer applies for 2019, the Affordable Care Act (ACA) requirements for employers are very much in play. Specifically, Applicable Large Employers (or ALEs) with 50 or more full-time or full-time equivalent employees must provide access to qualifying health coverage.
If your business sells products or services, and you’re accepting (or considering receiving) cryptocurrency as payment, you need to be aware of some tax implications that affect how you report your earnings. The Internal Revenue Service has started cracking down on businesses and individuals who don’t accurately report their virtual currency transactions and warning investors that they may owe capital gains taxes on cryptocurrency income.
They say one of the best-run organizations in the world is the U.S. Army — largely due to its leadership, structured environment and strict rules. While the Army has a rule book dictating nearly everything, your business probably doesn’t need anything that drastic. A well-thought-out employee handbook should do the trick — one that clearly sets expectations.
As an accountant or bookkeeper, you rely on the information your clients provide to prepare 1099-MISC forms. If this information isn’t complete or accurate, there may be complications or IRS penalties. Send an engagement letter to your clients so they know what to expect from your firm, including the details needed for the prompt filing of their forms.
Everyone needs time off from work once in a while to take care of personal matters, relax or recover from illness. Offering paid time off to employees provides a desirable benefit that can help you attract and retain good people. But what is the best way to track and manage your employee time off policy?
Many businesses choose to work with independent contractors. And that’s okay. It’s perfectly legal to rely on contractors for many different services. However, the IRS has strict rules around who can be a contractor and who is an employee under the law. And the penalties for getting it wrong include having to pay back taxes and significant fines.
On July 1, 2019, President Trump signed the Taxpayer First Act of 2019. Among the wide-sweeping changes proposed by the law, the Taxpayer First Act aims to modernize the IRS, expand and strengthen taxpayer rights and services, and reduce identity theft through enhanced cybersecurity.
It’s called a TIN – and it’s an essential number when filing W-2s, 1099s and ACA forms. A TIN, or Taxpayer Identification Number, is simply an individual’s Social Security number (SSN), or the Employer Identification Number (EIN), or EIN, for a business entity.
It’s almost here again – tax-filing “crunch time.” The time of year when accounting professionals and small business owners burn the midnight oil gathering information and completing tax forms. Stress levels can be high, but there are steps you can take to save your sanity.
Ideal for businesses with large or complex filings they’d like to outsource, Concierge Services are available through our partner company, ComplyRightSB. It’s never been easier to eliminate the administrative legwork of annual tax filing, while maintaining strict IRS compliance. ComplyRightSB is a dedicated print and mail resource that provides convenience, simplicity and complete security.
New for the 2018 tax-filing season, TIN matching is a verification process to ensure accurate TIN/name combinations for payer and payee data. This is an important time- and money-saving service because incorrect TINs can result in form rejection – and potential $250 mismatch penalties from the IRS.
In December 2017, the Tax Cuts and Jobs Act (TCJA) was signed into law — bold legislation designed to overhaul the U.S. tax code for the first time in 31 years. Although many individuals and families saw the changes to their tax situations, the fact is that small businesses are affected as well.
When it comes to digital or virtual currencies (such as bitcoin), the IRS expects transactions to be reported. Virtual currency is treated as property by the IRS, so it’s taxable by law. Although less scrupulous users of virtual currencies may try to fly under the radar and hide their activities, not reporting these transactions carries considerable risks.
For years now, you’ve handled your annual 1099 and W-2 reporting the same, old way – manually via paper forms or with software. You’re aware of e-filing, but you have your reservations. E-filing isn’t for everyone, you say. Every business owner’s perspective is different, but the reasons for resistance tend to fall under a few key areas.
In today’s increasingly digital world, it should come as no surprise that electronic tax filing is replacing old, manual processes. Businesses are no longer restricted to time-consuming and cumbersome paper or software-driven tax filing. Instead, they are turning to reputable, IRS-authorized e-file providers like efile4Biz.com to file taxes online and save valuable time and money.
Before e-filing, your options for 1099 and W-2 information reporting were printing, mailing and manually submitting forms to the IRS or SSA – or installing cumbersome tax-filing software. Then came efile4Biz – a simple, end-to-end, cloud-based service that lets you file 1099s, W-2s and other forms online through a secure website.
We live in an increasingly digital world. As we replace old, manual processes with faster, more efficient electronic options, it's not surprising that tax filing is experiencing the same shift. Businesses are no longer restricted to time-consuming and cumbersome paper filing of their taxes. Why should your business make the switch and e-file mandatory 1099 and W-2s forms?
When you’re handling lots of detailed information with 1099 and W-2 tax forms, you’re bound to make mistakes. But correcting them is easier than ever with our all-inclusive service.
Despite the uncertain future of the ACA, which survived the latest repeal attempt by the Trump administration in July, the IRS recently made it clear that its reporting regulations are still in effect.
For the first time last year, employers faced the daunting task of reporting employee healthcare coverage information under the Affordable Care Act (ACA).
File4Biz’s tax reporting forms filing platform has won national recognition for ease of use and top-notch customer support.
The benefits you receive from efile4Biz are significant. For instance, we automatically notify you when your forms are accepted by government agencies. Your data is stored for use year after year so you don’t have to reenter employee and contractor information.
While the new Affordable Care Act (ACA) reporting requirements presented quite a few challenges for employers and accountants this tax season, the good news is this: The first year of compliance is nearly over, and we’ve learned a lot along the way.
When it comes to the safe handling and storage of sensitive tax data, businesses and tax preparers can’t be too cautious. The risk of hacking and cyber fraud is always present, requiring airtight procedures, the latest technological advances and careful screening of vendors.
With this year’s tax-filing deadlines looming large, many employers are feeling the pressure of the new reporting requirements under the Affordable Care Act (ACA). In addition to annual 1099 and W-2 filing, applicable large employers (ALEs) with 50+ employees must report healthcare coverage information to employees and the IRS through the 1095-C (and transmittal form 1094-C).
As a business owner or tax preparer, you know that e-filing your 1099s, W-2s and new 1095s with efile4Biz.com is fast and efficient. Simply enter (or import) your recipient and form data online and we handle the rest – printing and mailing copies to your recipients, filing forms directly with the IRS or SSA, and sending notifications for confirmation.
Businesses ramping up for this year’s Affordable Care Act (ACA) reporting requirements now have more time to meet the upcoming deadlines. On December 28, 2015, the IRS issued Notice 2016-4, which extended the deadlines for reporting health care coverage to employees/recipients and the IRS through forms 1095-B and 1095-C.