Category: Small Business
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Big tax change for small businesses
The IRS reminds employers that starting in tax year 2020, payers must complete the new Form 1099-NEC, Nonemployee Compensation, to report any payment of $600 or more to a payee. This is likely the biggest change that affects a large number of small businesses this year. Generally, payers must file Form 1099-NEC by January 31.…
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Simple bookkeeping systems for sole proprietors
In general, I try to have a coaching conversation with new clients and prospective clients about the reasonable time and cost allocation for bookkeeping in relation to other business factors. We hope to see this allocation consistent with others who are successful within a business niche and, if a significant difference exists, look more closely…
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TAX ALERT: Non-employee compensation
SIGNIFICANT TAX NEWS CHANGE ABOUT NON-EMPLOYEE COMPENATION: The IRS revived the use of Form 1099-NEC for use in reporting non-employee compensation for 2020. This form was last used in 1982 but now will be used to report 2020 non-employee compensation. Corresponding changes were made to the old 1099-MISC form. The due dates are also changed.…
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2020 IRS Report on its Operations
IRS just released the 195 page “General Report of the 2020 Internal Revenue Service Advisory Council“. I read the applicable sections on small business and nonprofits that affects me and my clients. The key relevant concepts are: 1) IRS currently lacks the funding to operate effectively to collect the taxes necessary to run federal government.…
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Covid small business disaster story update
My list of Covid small business accounting horror stories is down to just three remaining open and unresolved: 1) A bank that extended a PPP loan application to 4 1/2 months and still counting; apparently due solely to lack of internal process control. I follow up with them every two to three days. All involved…
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Update on pandemic payroll tax deferrment
New guidance on the so-called pandemic payroll tax deferment issued by IRS last week does not change previously issued guidance to small business employers. The new IRS guidance strengthens the argument that employers should not make any change in payroll tax practices at this time. Deferent of payroll taxes, if not paid timely in early…
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A business resurrection as consumer value returns to employee benefits
Going back since more than 20 years ago to the late 1990s, I was licensed as an insurance producer in all 50 states and the District of Columbia. It was – and still is – tough to be called a small business compensation and benefits expert without also being an expert in insurance. I was…
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What’s going on in D.C. and how does it affect your South Jersey business?
Yesterday the New Jersey Chamber of Commerce sponsored a discussion program with government policy experts from the U.S. Chamber of Commerce titled “What’s going on in D.C. and how it affects your business?”. If you own a small business in New Jersey (like me) the basic question is likely ‘How bad will it be?’ This…
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Small Business Guidance on Payroll Withholding Postponement
This weekend the President issued an Executive Order to postpone employer’s payment of wage taxes. The advice that I and every other small business tax adviser, to my knowledge, immediately issued to clients was to take no action until we receive further guidance. Most tax experts believe that only Congress has the power to stop…
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Round Two of Small Business Recovery
Two months ago the U.S. House of Representatives passed a bill called the “HEROS Act” that included financial resources to small businesses struggling to restart after the disruptive effects of pandemic shutdown. While the entire bill is not likely to become law because of objections by U.S. Republican Senators, the small business portions of that…