It is additional work and more expensive to maintain a staff of employees compared to hiring independent contractors. But there are strict rules on determining a workers status. The courts analyze 7 factors to determine the classification of workers. The 7 factors are used to determine the degree of control and independence.
Independent Contractor versus Employee – Cost Differences
We reviewed the different filing requirements for treating workers as independent contractors compared to employees. Next we will review the cost differences between the two classifications. Continue reading…
Independent Contractor versus Employee – Filing Requirements
A common decision to be made for small businesses is whether to treat workers as employees or independent contractors. There are both legal and tax considerations for the treatment chosen. We will review the tax considerations for treating workers as independent contractors versus employees.
Tax Help Question: Claim Charitable Deduction for Providing Services
Question: I am donating business services to a church. Can I deduct my time spent as charitable contribution? If so, how do I record my time? Do I issue the church an invoice for my time?
Fake IRS Garnishment Notices
You are getting bombarded with calls and letters due to owing back tax balances. Watch out for all the tricks companies use to solicit your business.
Basic Rules for Paying Estimated Taxes
This is topic no one really wants to discuss because most people dislike paying the IRS on a quarterly basis. Who wants to take money from their earnings to pay Uncle Sam? To date, we have not found anyone that enjoys this process. But it is a necessary evil. Failing to pay estimates can lead to large tax bill at the end of the year including a significant amount of penalties. This blog reviews the basic rules for paying estimated taxes. Continue reading…
2014 and 2018 Tax Changes Due to Obamacare
In our previous blog, we reviewed the 2013 tax changes due to the Patient Protection and Affordable Care Act or in other words Obamacare. This blogs reviews the 2014 and 2018 tax changes. Continue reading…
2013 Tax Changes Due to Obamacare
We get quite a few questions and comments regarding the Patient Protection and Affordable Care Act or in other words Obamacare. This blogs reviews the 2013 tax changes.
Tax Help Question – LLC Taxed as S-Corp and Trust Fund Penalties
Question: In IRS Publication 3402, Taxation of Limited Liability Company, it states that an LLC can elect to be classified as a S corporation. Does an individual member of an LLC that has elected S corp status have the same protections from personal liability for payroll taxes as an individual member of an LLC that has elected C corp status? Stated differently, does the IRS have to conduct a trust fund investigation to impose personal liability on individual members of an LLC that has elected S corp status? Continue reading…
Accounting Firm Hit with Trust Fund Penalties for Payroll Taxes Owed by thier Client
We mentioned in a previous blog that individuals such as corporate officers and employees can be held responsible for back taxes if the company fails to pay payroll taxes. However, other parties not within the company can be held responsible for back taxes such as lenders and accounting firms. In this case, the accounting firm hired to manage the client’s payroll was held responsible for $325K of Trust Fund Penalties. This is an interesting case because it shows that the IRS can go after third parties for trust fund penalties. Continue reading…