irs - Linkenheimer LLP CPAs & Advisors

1099 Requirements for 2015

The IRS requires that you file information returns (1099’s) for cash and check payments issued by your trade or business to individuals not treated as your employees as well as non-incorporated entities. The IRS strictly enforces the requirements and aggressively audits this area of the law; additionally, there are numerous penalties that may be assessed if you fail to comply. We recommend that PRIOR to making payments for services, you obtain taxpayer identification (ID) numbers from all of your service vendors. If they don’t provide you a SSN or IRS business ID number (EIN), you are required to withhold taxes on payments to that vendor. A 1099 form must be filled in if:

Amount Requiring Reporting

Contract Labor, Commissions, Director Fees and
Other Non-employee Compensation $600 or more

Dividends, Interest and Royalties $10 or more

Professional Fees […]

By Linkenheimer LLP|2020-09-03T20:05:15+00:00March 11th, 2016|irs, Uncategorized|0 Comments

Beware of Fake IRS Calls and Emails

Recently there have been an influx of calls and emails to citizens of Sonoma County from people claiming to be from the IRS. This is a known scam and is an ongoing issue. Here are some tips from the IRS website on how to identify a fake call from the IRS and what to do:

“The IRS reminds people that they can know pretty easily when a supposed IRS caller is a fake. Here are five things the scammers often do but the IRS will not do. Any one of these five things is a tell-tale sign of a scam. The IRS will never:

1. Call to demand immediate payment, nor will we call about taxes owed without first having mailed you a bill.
2. Demand that you pay taxes without giving you the opportunity to question or appeal the amount they say you owe.
3. Require you to use a specific payment method for your taxes, such as a prepaid debit card.
4. Ask for credit or debit card numbers over the phone.
5. Threaten to bring in local police or other law-enforcement groups to have you arrested for not paying.

If you get a phone call […]

By Linkenheimer LLP|2020-09-03T20:05:15+00:00February 23rd, 2016|irs|0 Comments

Reminder IP PINs Are Required for Identity Theft Victims’ 2015 Returns

In mid December, the IRS issued CP01A notices containing a 6-digit Identity Protection Personal Identification Number (IP PIN) for taxpayers who are victims of tax-related identity theft. This notice is sent to taxpayers who: (1) reported to the IRS they are a victim of identity theft; (2) have been identified by the IRS as a victim of identity theft; (3) received an IP PIN last year, or (4) participated in the 2015 IP PIN pilot for residents of FL, GA, or DC. Beginning 1/1/16, taxpayers who are assigned an IP PIN must use it (regardless of whether the SSN is entered for a primary, spouse, or dependent/qualifying individual) on the following returns: Form 1040 series, Form 2441 (Child and Dependent Care Expenses), and Schedule EIC (Earned Income Credit). If the IP PIN is not included in any of the required fields, the return will be rejected. See www.irs.gov/Individuals/IPPIN-Rule .

By Linkenheimer LLP|2020-09-03T20:05:17+00:00January 7th, 2016|irs|0 Comments

New PATH Act Provides Major Benefits to Businesses in 2015

With only two weeks remaining until the end of the year, Congress passed the Protecting Americans from Tax Hike (PATH) Act of 2015, which reinstates a large number of tax provisions that had expired in 2014, many of which were not just renewed, but made permanent, while some of the other provisions are extended through 2016, and in some cases, 2019. This gift from Congress comes just in time for the holidays and will have a significant impact on tax payers and businesses. Below are some of the major provisions worth noting. And because California does not conform to some of these tax breaks, please contact us so we can help with your individual and year-end tax planning.

Highlights of the PATH Act:

$622 Billion Tax Break Package
Over 100 Separate Provisions
Permanent Research Tax Credit, Code Sec. 179 Expensing and AOTC (American Opportunity Tax Credit)
Five-Year Extension for Bonus Depreciation
Delay of Excise Tax on “Cadillac” Plans
Moratorium on Medical Device Excise Tax
Overall Major IRS Reform

Permanent Extensions for Individuals

Earned income tax credit
American Opportunity Tax Credit
Child tax credit
Option to to deduct state and local sales and use taxes instead of state and local income taxes
Teachers classroom expense deductions
Charitable distributions for IRAs
Qualified […]

By Linkenheimer LLP|2020-09-03T20:05:18+00:00December 29th, 2015|congress, extension, extensions, irs|0 Comments

Standard mileage rates will go down in 2016

Optional standard mileage rates for business use of a vehicle will go down beginning January 1st, 2016, the IRS announced on Thursday. For business use of a car, van, pickup truck, or panel truck, the rate for 2016 will be 54 cents per mile, compared with 57.5 cents in 2015. Taxpayers can use the optional standard mileage rates to calculate the deductible costs of operating an automobile.

STANDARD MILEAGE RATES

The standard mileage rate for transportation or travel expenses is 54 cents per mile for all miles of business use (business standard mileage rate).
The standard mileage rate is 14 cents per mile for use of an automobile in rendering gratuitous services to a charitable organization.
The standard mileage rate is 19 cents per mile for use of an automobile (1) for medical care described in § 213, or (2) as part of a move for which the expenses are deductible.

BASIS REDUCTION AMOUNT For automobiles a taxpayer uses for business purposes, the portion of the business standard mileage rate treated as depreciation is 23 cents per mile for 2012, 23 cents per mile for 2013, 22 cents per mile for 2014, 24 cents per mile for 2015, and 24 […]

By Linkenheimer LLP|2020-09-03T20:05:19+00:00December 18th, 2015|mileage|0 Comments