payments

California Tax Updates for July 8th

Mail.

Post 1:

Interest rates set on overdue payroll tax in California. For the period beginning July 1, 2020, through Dec. 31, 2020, the rate will be 5% compounded daily, according to the CA Employment Development Department. The rate is adjusted semiannually.

Post 2:

A California apparel designer loses a tax credit fight in court. CA companies that engage in qualified research and development (R&D) activities may be entitled to a credit on their CA tax returns. In one case, a women’s apparel design company filed for tax refunds for 2008 through 2011, based on claims for R&D credits in those years. The credit related to projects, which the CA Franchise Tax Board (FTB) said didn’t satisfy a requirement known as the experimentation process test. The credits were disallowed. The taxpayer sought a rehearing in the CA Office of Tax Appeals. The Appeals Court agreed with the FTB and upheld the decision to disallow the credit. (Swat-Fame, Inc. 5/20/20) If you […]

By |July 8th, 2020|ca, CA tax, california, payments, research credit, tax credit|0 Comments

What Businesses Need to Know About the Tax Treatment of Bitcoin and Other Virtual Currencies

Over the last several years, virtual currency has become increasingly popular. Bitcoin is the most widely recognized form of virtual currency, also commonly referred to as digital, electronic or crypto currency.

While most smaller businesses aren’t yet accepting bitcoin or other virtual currency payments from their customers, more and more larger businesses are. And the trend may trickle down to smaller businesses. Businesses also can pay employees or independent contractors with virtual currency. But what are the tax consequences of these transactions?

Bitcoin 101

Bitcoin has an equivalent value in real currency and can be digitally traded between users. It also can be purchased with real currencies or exchanged for real currencies. Bitcoin is most commonly obtained through virtual currency ATMs or online exchanges.

Goods or services can be paid for using “bitcoin wallet” software. When a purchase is made, the software digitally posts the transaction to a global public ledger. This prevents the same unit of virtual currency from being used multiple times.

Tax impact

Questions about the tax impact of virtual currency abound. And the IRS has yet to offer much guidance.

The IRS did establish in a 2014 ruling that bitcoin and other convertible virtual currency should be […]

By |June 5th, 2018|credit, irs, payments, tax, tax implications|0 Comments

Department of Labor Issues New Overtime Payment Rules

On May 18, 2016, President Obama and Secretary Perez announced the publication of the Department of Labor’s final rule updating the overtime regulations, which will automatically extend overtime pay protections to over 4 million workers within the first year of implementation.

Key Provisions of the Final Rule

The Final Rule focuses primarily on updating the salary and compensation levels needed for Executive, Administrative and Professional workers to be exempt. Specifically, the Final Rule:

  1. Sets the standard salary level at the 40th percentile of earnings of full-time salaried workers in the lowest-wage Census Region, currently the South ($913 per week; $47,476 annually for a full-year worker);
  2. Sets the total annual compensation requirement for highly compensated employees (HCE) subject to a minimal duties test to the annual equivalent of the 90th percentile of full-time salaried workers nationally ($134,004); and
  3. Establishes a mechanism for automatically updating the salary and compensation levels every three years to maintain the levels at the above percentiles and to ensure that they continue to provide useful and effective tests for exemption.

Additionally, the Final Rule amends the salary basis test to allow employers to use non-discretionary bonuses and incentive payments (including commissions) to satisfy up to 10 percent […]

By |May 19th, 2016|payments|0 Comments

A letter from the CA-FTB: Form 1099-MISC – is it enough?

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By |October 10th, 2012|1099, CA tax, CPA, federal, income tax, irs, Linkenheimer, payments, tax, withhold|1 Comment