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11.14.08 Test Your AP IQ: Form 1099 and DBAs
You pay a vendor that is a sole proprietorship with a business name. The checks are made out to the business name. What name should be on the Form 1099?
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11.10.08 New Deadline for Certain 1099s
The Internal Revenue Service has posted to its Web site a notice on the new due date for furnishing certain information returns to recipients enacted under recent federal bailout legislation (Public Law 110-343). It said that, under Division B, Section 403, the due date for providing recipients with Copy B of certain information returns filed after 2008 is Feb. 15 of the year following the calendar year for which the return is required to be filed.
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11.07.08 Test Your AP IQ: Temporary Housing
An employee submits an expense report that includes a hotel charge for $2,000. The business reason given is “temporary living expenses for new job.” Upon investigation, you find that this is a new employee who had to relocate. After he started his new job, he still did not have a place to live, so he was allowed to stay at a hotel temporarily. The employee put the charge on a corporate travel card that was issued to him by your organization (AP pays the credit card statement). You get a W-9 from the hotel that indicates that it is organized as a partnership. On what form (or forms) is this transaction reported at year-end?
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11.03.08 FedEx Drivers Win $9.1M in Expenses
Current and former drivers for FedEx Ground who were misclassified as contractors instead of employees would receive another $9.1 million in reimbursements for job-related expenses under a tentative ruling from a court-appointed referee, according to an attorney for the drivers. more...
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10.17.08 Test Your AP IQ: Board Fees and Form 1099
In what box on Form 1099 should you report payments of fees to members of your organization’s Board of Directors? more...
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09.22.08 Baker’s Dozen of 1099 Tasks to Start Now
Now’s the time to start preparing to file Form 1099. Here are 13 things you can do right now to get things started to make this task go easier. more...
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09.19.08 Test Your AP IQ: TIN Types
What are the acronyms for the five different types of Taxpayer Identification Numbers (TINs)?
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09.15.08 Congress, IRS Step Up Crackdowns
Worker classification and employee tool reimbursement plans are two areas getting more attention from the Internal Revenue Service and Congress, an IRS official said at a recent conference.
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08.22.08 Test Your AP IQ: Form 1099 Penalties
For each Form 1099 you file with a missing or incorrect Taxpayer ID Number (TIN), what is the penalty the IRS can impose on your organization?
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08.19.08 Get a W-9 from Tax-Exempts
Although you are not required to do Form 1099 reporting for payments you make to tax-exempt organizations, a best practice is to get a W-9 form from them just the same. Why? For one thing, the Internal Revenue Service regularly pulls the tax-exempt status of organizations that no longer meet the tax-law rules for these types of organizations. Also, many charities have for-profit subsidiaries that operate their commercial businesses. You could also have organizations that say they are tax-exempt but are not legitimate. Charity scams are very common.
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08.04.08 1099 Reporting of Options Delayed
The Internal Revenue Service is delaying Form 1099 reporting for stock transfers on the exercise of incentive stock options, according to a report in the Kiplinger Tax Letter. Organizations were supposed to start sending the IRS 1099 forms in 2009 for transfers pursuant to options that were exercised in 2008, but the IRS is suspending that rule for one year to give firms time to get their automated systems ready. This means organizations will have to start sending the 1099s in 2010 for options exercised during 2009.
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06.30.08 Congress Enters 1099 Worker Fray
Legislation aimed at stopping employers from improperly classifying employees as independent contractors to avoid minimum wage and overtime obligations, employment taxes, and benefit contributions has been introduced in the House of Representatives.
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06.16.08 New IRS Worker Classification Initiative
The Internal Revenue Service is undertaking new employment tax enforcement initiatives, including closer attention to worker classification issues, Kathy Petronchak, IRS commissioner for the Small Business/Self-Employed Division, told attendees at the recent American Payroll Association 26th Annual Congress.
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06.13.08 Test Your AP IQ: Reimbursements to Spouses
How familiar are you with AP rules, regulations, and best practices? Here’s a question to test your knowledge: Acme Company reimburses spouses of executives when the couple travels on company business. Acme must report the spouses’ reimbursement on the Form 1099-MISC. True or False?
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06.09.08 Control=Employee, Says the IRS
A medical professional is considered an employee—not a Form 1099 independent contractor--for employment tax purposes where the company directly supervises and controls her work, the Internal Revenue Service determined in Private Letter Ruling.
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05.19.08 No 1099s On Contingent Promo Payments
Contingent promotional payments made by a retailer to customers are not subject to Form 1099 information reporting and withholding requirements, says a new private letter ruling from the Internal Revenue Service. more...
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05.12.08 New Bill Cracks Down on 1099 Workers
Top Democrats on the House Ways and Means Committee have introduced legislation (H.R. 5804) designed to cut down the number of employees who can be classified as Form 1099 independent contractors. It also increases fines for filing incorrect information returns and repeals “Section 530” relief.
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04.14.08 IRS Reveals Form 1099 Red Flag
The issue of worker classification and Form 1099 freelancers figures in prominently with the current efforts to deal with the overall tax gap. The tax gap is a major concern both of the U.S. Congress and of the Bush administration, Anita Bartels, senior program analyst with the Internal Revenue Service's Employment Tax Operations program, told attendees at the American Payroll Association's recent Capital Summit. more...
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04.11.08 Test Your AP IQ: Form W-9 Requirement
How familiar are you with AP best practices, rules, and regulations? Here’s a question to test your knowledge: How often are you required to have a vendor give you a W-9 form or substitute?
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03.17.08 IRS, States’ Probe of 1099ers Bears Fruit
The Internal Revenue Service has created a Questionable Employment Tax Practice workgroup in conjunction with several states. The mission is to identify employers that misclassify employees as independent contractors. In New York, a gubernatorial task force has found that at least 2,000 workers in the state have been misclassified as independent contractors in the past four months, resulting in the underpayment of federal, state, and local taxes.
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02.18.08 Details of New Proposed Form 1099 Rules
President Bush has included various proposals in his administration’s 2009 budget that would affect Form 1099 reporting. The proposals call for such changes as the removal of the exemption on payments made to corporations, higher penalties for noncompliance, requiring credit card companies to issue 1099s on payments made to merchants, imposing a new mandate to certify TINs, and expanding the 1099 reporting requirements for governments. Here’s a quick rundown of the key provisions.
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01.14.08 $1 Billion Fine for Using 1099s
FedEx could face penalties totaling more than $1 billion after the Internal Revenue Service completes its investigation into the company's misclassification of drivers as independent contractors, according to the International Brotherhood of Teamsters.
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01.07.08 1099 Workers Set to Snitch
If your organization has independent contractors who believe they should be treated as employees, they will soon tell the Internal Revenue Service all about it. That’s because they will file a new form with their personal tax returns—Form 8919—which will give the IRS information about their employers.
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12.24.07 Timber! IRS to Cut Down 1099 Loophole
The Internal Revenue Service has the notion that there’s tax avoidance going on with respect to purchases of timber. So the agency has proposed regulations regarding the information reporting requirements on sales or exchanges of standing timber for lump-sum payments. Next year, these transactions will be reported on 1099 forms.
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12.07.07 Test Your AP IQ: Independent Contractors
What is the most important factor in determining whether a worker is classified as an employee or independent contractor? more...
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11.30.07 Test Your AP IQ: 1099 Reporting and Expense Reports
How familiar are you with AP best practices, rules, and regulations? Here’s a question to test your knowledge: An employee pays a 1099-reportable vendor with his personal credit card. This is a business expense, so he puts the charge (which is $1,500) on his expense report and is reimbursed by his company. Does the company have a 1099 reporting obligation for this transaction?
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11.26.07 Congress Poised to Move on 1099 Crackdown
Fines for filing incorrect 1099 forms will increase dramatically under legislative proposals kicking around Washington. Also, the “corporate exemption” to Form 1099 reporting will vanish under the planned rules. These proposals can be found in the logjam of tax relief bills Congress will work to pass between now and the end of the year. Lawmakers are eyeing the Form 1099 proposals because they’re considered “revenue raisers” that will help to offset the cost of the tax breaks planned for individuals and businesses.
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11.12.07 IRS Fixes New Form W-9 Instructions
The Internal Revenue Service has revised Form W-9, Request for Taxpayer Identification Number and Certification, to correct the instructions portion, the agency said in a Web notice.
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11.09.07 Test Your AP IQ: Reporting Relocation Payments
How familiar are you with AP best practices, rules, and regulations? Here’s a question to test your knowledge:
Acme Company hires a new employee who had to relocate. Acme agrees to pay for the employee’s temporary living expenses after he has started work in the new location. The company’s AP department pays a $1,500 invoice from a hotel (organized as a partnership) for the employee’s temporary living expenses. This payment should be reported on what form or forms?
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11.02.07 Test Your AP IQ: W-9 Form Requirement
How familiar are you with AP rules, regulations, and best practices? Here’s a multiple-choice question to test your knowledge: When should you have a vendor give you a new Form W-9 (or substitute)? more...
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