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Upcoming events & IRS news releases
4/4/2014
Announcements & Upcoming Events:
Tax filing questions or need to check on a tax account issue?
Call the IRS Business & Specialty Toll Free number, 1-800-829-4933, open Monday – Friday, 7:00 a.m. – 7:00 p.m. your local time (Alaska & Hawaii follow Pacific Time). You can find a complete list of IRS toll free numbers here. And yes, during the tax season there will be long hold times on that line!
Did you know? One of the best ways to get information is by visiting the IRS Small Business Tax Center where you can learn everything from how to get an Employer Identification Number (EIN) online to how to best navigate an audit.
Affordable Care Act 101 Webinars for Small Business
The SBA and Small Business Majority are holding weekly Affordable Care Act 101 webinars. During the presentation, small business owners can learn about the law and what it means for their company and employees. Visit the web page above for a complete schedule, but webinars are generally held every Thursday at 11:00 am Pacific Time.
Small Business Workshops – Seattle SBA Education and Training Center
Small Business Taxes & Bookkeeping for the Small Business Owner -2nd & 4th Thursday of each month - 9:00 am to 11:00 am
Learn about important information regarding your tax responsibilities as a small business owner. Topics covered:
- What taxes to pay and when they are due
- How to choose the right accountant and the right accounting software
- How to document expenses and activities
- How to take care of employee and contractor payroll taxes
- The difference between city, county, state, and federal taxation
- What the tax advantages are for the sole proprietor or for business entities in general
Workshops are held at the 4th & Battery Building - 2401 Fourth Avenue, Suite 450, Seattle
Seattle SCORE Workshops
SCORE offers workshops designed to give you the skills necessary to start your own successful business.
April 2, May 7, June 4 -- Starting a New Business
4th & Battery Building - 2401 Fourth Avenue, Suite 450, Seattle
Spokane SCORE Workshops
Spokane Regional Business Center (SRBC), 801 W. Riverside Avenue, Suite 444, Spokane
April 2, May 7, June 4 -- Starting a New Business
Check website for current listings and registration information.
Washington State Dept of Labor & Industries - Free Contractor Training Days
More than 25 different classes are offered on subjects including: safety, managing your claims to control your workers' compensation costs, public works contracting, business planning, risk management, marketing and more. See the link above for registration information.
Employer's Introduction to L&I Workshops
This workshop is designed for new businesses or businesses that plan to hire workers for the first time. It explains an employer’s rights and responsibilities and provides an overview of the services and resources available at Labor and Industries.
Apr 2 – Tukwila -- 9:00a to 12:00p
Apr 10 -- Tacoma -- 9:00a to 11:30a
Apr 22 -- Tumwater -- 9:00a to 12:00p
Apr 24 -- Port Angeles -- 9:00a to 11:30a
Apr 29 – Vancouver -- 9:00a to 12:00p
New Business Tax Workshops – Washington State Department of Revenue
Learn the basics of Washington State taxes. This free workshop will help you understand your tax reporting responsibilities. Tax reporting classifications, deductions, sales tax collection, and recordkeeping requirements will be discussed. You'll also have the opportunity to ask questions regarding taxes that apply specifically to your business. To find out when the next workshop will be held in your area, and to register, see the link above. Can’t attend a workshop in person? Watch an online workshop or tutorial.
IRS Updates & News Releases:
Did you know? One of the best ways to get information is by visiting the IRS Small Business Tax Center where you can learn everything from how to get an Employer Identification Number (EIN) online to how to best navigate an audit.
It is almost impossible to be in business and not collect or hold personally identifying information — names and addresses, Social Security numbers, etc., about your customers, employees or patients. If this information is lost or stolen, it could put these individuals at risk for identity theft. However, not all compromises of personal information result in identity theft. The type of personal information compromised can significantly affect the degree of potential damage. What steps should you take and whom should you contact if personal information is compromised? Answers vary depending on the situation; however, the following information can help you make smart, sound decisions. Check federal and state laws or regulations for any specific requirements for your business. See the full article for three important steps to take when you first realize your business has encountered a data security breach, as well as other resources for businesses facing a data security breach.
IRS Encourages Small Employers to Check Out Small Business Health Care Tax Credit; Helpful Resources, Tax Tips Available on IRS.gov
With business tax-filing deadlines fast approaching, the Internal Revenue Service encourages small employers that provide health insurance coverage to their employees to check out the small business health care tax credit and then claim it if they qualify. The Small Business Health Care Tax Credit page on IRS.gov is packed with information and resources designed to help small employers see if they qualify for the credit and then figure it correctly. These include a 2013 tax credit estimator, examples of typical tax savings under various scenarios and answers to frequently-asked questions. Additionally, the IRS has Health Care Tax Tips, designed to provide useful information to employers, families and individuals. These tips include a new Small Business Health Care Tax Credit tip as well as tips covering other Affordable Care Act topics. For 2010 through 2013, the maximum credit is 35 percent of premiums paid by eligible small businesses and 25 percent of premiums paid by eligible tax-exempt organizations. In 2014, the maximum credit rate rises to 50 percent for small businesses and 35 percent for tax-exempt organizations.
Depending upon how they are structured, eligible small employers are likely subject to one of the following three tax-filing deadlines, which fall in coming weeks:
March 17: Corporations and S Corporations that file on a calendar year basis can figure the credit on Form 8941 attached to the income tax return.
April 15: Partnerships and individuals have until April 15 to complete and file their income tax returns (partnerships on Form 1065 and individuals on Form 1040). Sole proprietors can figure the credit on Form 8941 attached to the individual income tax return. Individuals who have business income and credits reported to them on Schedules K-1—partners in partnerships, S corporation shareholders and beneficiaries of estates and trusts—will report the credit amount directly on Form 3800– no Form 8941 required. The resulting credit is entered on Form 1040, Line 53.
May 15: Tax-exempt organizations that file on a calendar year basis can use Form 8941 and then claim the credit on Form 990-T, Line 44f.
Taxpayers needing more time to determine eligibility should consider obtaining an automatic tax-filing extension, usually for six months. See Form 4868 for individuals, Form 7004 for businesses and Form 8868 for tax-exempt organizations.
Reminder To Home-Based Businesses: Simplified Option for Claiming Home Office Deduction Now Available; May Deduct up to $1,500; Saves 1.6 Million Hours A Year
The Internal Revenue Service reminds people with home-based businesses that this year for the first time they can choose a new simplified option for claiming the deduction for business use of a home. In tax year 2011, the most recent year for which figures are available, some 3.3 million taxpayers claimed deductions for business use of a home (commonly referred to as the home office deduction) totaling nearly $10 billion. The new optional deduction, capped at $1,500 per year based on $5 a square foot for up to 300 square feet, will reduce the paperwork and recordkeeping burden on small businesses by an estimated 1.6 million hours annually. The new option is available starting with the 2013 return taxpayers are filing now. Normally, home-based businesses are required to fill out a 43-line form (Form 8829) often with complex calculations of allocated expenses, depreciation and carryovers of unused deductions. Instead, taxpayers claiming the optional deduction need only complete a short worksheet in the tax instructions and enter the result on their return.
The Internal Revenue Service has issued a notice providing answers to frequently asked questions (FAQs) on virtual currency, such as Bitcoin. These FAQs provide basic information on the U.S. federal tax implications of transactions in, or transactions that use, virtual currency. In some environments, virtual currency operates like “real” currency -- i.e., the coin and paper money of the United States or of any other country that is designated as legal tender, circulates, and is customarily used and accepted as a medium of exchange in the country of issuance -- but it does not have legal tender status in any jurisdiction. The notice provides that virtual currency is treated as property for U.S. federal tax purposes. General tax principles that apply to property transactions apply to transactions using virtual currency.
Among other things, this means that:
- Wages paid to employees using virtual currency are taxable to the employee, must be reported by an employer on a Form W-2, and are subject to federal income tax withholding and payroll taxes.
- Payments using virtual currency made to independent contractors and other service providers are taxable and self-employment tax rules generally apply. Normally, payers must issue Form 1099.
- The character of gain or loss from the sale or exchange of virtual currency depends on whether the virtual currency is a capital asset in the hands of the taxpayer.
- A payment made using virtual currency is subject to information reporting to the same extent as any other payment made in property.
Further details, including a set of 16 questions and answers, are in Notice 2014-21, posted today on IRS.gov.
New IRS Video Helps Same-Sex Couples; Joins Extensive IRS Library Of Online Tax Tips
The IRS released a new YouTube video designed to provide useful tax tips to married same-sex couples. The new video, less than two minutes long, is available in English, Spanish and American Sign Language and can be accessed via IRS.gov. It joins an array of online products, including answers to frequently-asked questions, designed to help same-sex couples file their federal income tax returns. Following last summer’s Supreme Court decision invalidating a key provision of the Defense of Marriage Act, the IRS ruled that same-sex couples, legally married in jurisdictions that recognize their marriages, are now treated as married for federal tax purposes. The ruling applies to all federal tax provisions where marriage is a factor, including filing status, claiming personal and dependency exemptions, taking the standard deduction, employee benefits, contributing to an IRA and claiming the earned income tax credit or child tax credit.
More than Half of all Income Tax Returns Have Been Received; IRS Issues Publication on Business Expenses
With the tax deadline getting closer, the IRS has received more than half of all the returns it expects to receive during 2014. The IRS received more than 75 million individual tax returns as of March 14 and projects that it will receive about 149 million individual income tax returns by the end of the year. Millions of individual tax filers have business income either as sole proprietors or as sub contractors. Many individual filers also have unreimbursed business expenses. The IRS recently issued Publication 535, Business Expenses, which provides valuable information for these filers. The publication contains useful hints for Tax Year 2013, for which many taxpayers are still completing returns and for Tax Year 2014, for which taxpayers are tracking expenses and making financial decisions.
For most people, the Affordable Care Act has no effect on the 2013 income tax return they are filing in 2014. However, some people may need to make important decisions by the March 31, 2014 deadline for open enrollment. See the article for five things about the health care law you may need to consider soon.
The IRS 2013 Data Book provides details on the agency's activities during fiscal year 2013. The report describes activities conducted by the IRS from Oct. 1, 2012, to Sept. 30, 2013, and includes information about returns filed, taxes collected, enforcement, taxpayer assistance and the IRS budget and workforce, among others. An electronic version of the 2013 Data Book can be found on the Tax Stats page of IRS.gov.
Notice 2014-18 solicits public comments on recommendations for items that should be included on the 2014-2015 Guidance Priority List. Notice 2014-18 will be published in Internal Revenue Bulletin 2014-15 on April 7, 2014.
Tax Tips
Health Care Tax Tips
Check out the tax tips for your health care questions on this page – here is a sample:
Subscribe to e-News for Small Businesses
Online Tax Calendar
Watch this YouTube video to see how you can automatically get business due dates by downloading the IRS Online Tax Calendar. Watch this and other videos on the IRS YouTube Channel.
Understanding Your Form 1099-K
IRS.gov Information Available in Five Languages
Much of the information available on IRS.gov is also available in five other languages: Spanish, Chinese, Korean, Vietnamese and Russian. These language sites are accessible from the “Language” box at the top right of the IRS.gov homepage.
IRS Audit Video Series
"Your Guide to an IRS Audit” takes the viewer through the steps of an audit, from notification to closing. The video series is composed of scenarios that demonstrate the stages of each type of audit; correspondence, office and field. The scenarios address issues that are common to audits of small businesses.
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