New York SBDC Research Network

From IRS Publication 587 (“Business Use of Your Home”) : Qualifying for a Deduction Generally, you cannot deduct items related to your home, such as mortgage interest, real estate taxes, utilities, maintenance, rent, depreciation, or property insurance, as business expenses. However, you may be able to deduct expenses related to the business use of part of your home if you meet specific requirements. Even then, the deductible amount of these types of expenses may be limited. Use this section and Figure A, later, to decide if you can deduct expenses for the business use of your home. To qualify to deduct expenses for business use of your home, you must use part of your home: Exclusively and regularly as your principal place of business, Exclusively and regularly as a place where you meet or deal with patients, clients, or customers in the normal course of your trade or business, In the case of a separate structure which is not attached to your home, in connection with your t

From the IRS (Tax Tip 2013-15): IRS to Employers: Hire Veterans by Dec. 31 and Save on Taxes If you plan to hire soon, consider hiring veterans. If you do, you may be able to claim the federal Work Opportunity Tax Credit worth thousands of dollars. You must act soon. The WOTC is available to employers that hire qualified veterans before the new year. Here are six key facts about the WOTC: 1. Hiring Deadline.   Employers hiring qualified veterans before Jan. 1, 2014, may be able to claim the WOTC. The credit was set to expire at the end of 2012. The American Taxpayer Relief Act of 2012 extended it for one year. 2. Maximum Credit.  The tax credit limit is $9,600 per worker for employers that operate a taxable business. The limit for tax-exempt employers is $6,240 per worker. 3. Credit Factors.   The credit amount depends on a number of factors. They include the length of time a veteran was unemployed, the number of hours worked and the amount of the wages paid during

From irs.gov/aca : The Affordable Care Act, or health care law, contains new benefits and responsibilities for employers. The size and structure of your workforce – small, large, or part of a group – helps determine what applies to you. Employers with: Fewer than 25 full-time equivalent employees may be eligible for a Small Business Health Care Tax Credit to help cover the cost of providing coverage. Generally 50 or fewer employees may be eligible to buy coverage through the Small Business Health Options Program (SHOP). Learn more at HealthCare.gov 50 or more full-time equivalent employees will need to file an annual return reporting whether and what health insurance they offered employees. In addition, they are subject to the Employer Shared Responsibility provisions .

From the IRS : The American Taxpayer Relief Act of 2012 (ATRA) (H.R. 8) extends the Work Opportunity Tax Credit (WOTC) for hiring certain workers through Dec. 31, 2013. The VOW to Hire Heroes Act of 2011 made changes to the Work Opportunity Tax Credit (WOTC), including adding new categories to the qualified veterans targeted group and expanding the WOTC to make a reduced credit available to tax-exempt organizations for hiring qualified veterans. The VOW Act also extended the WOTC for qualified veterans hired before Jan.1, 2013. The other targeted group categories were not extended by the VOW Act and expired for targeted group members other than qualified veterans hired after Dec.31, 2011. ATRA extends the WOTC for qualified veterans hired before Jan. 1, 2014. ATRA also extends the WOTC for targeted group members, other than qualified veterans, hired after Dec.31, 2011, and before Jan.1, 2014.

IRS publications: #552 Recordkeeping for Individuals #583 Starting a Business & Keeping Records #463 Travel Entertainment, Gift, and Car Expenses IRS videos Small Business Taxpayer

As 2012 comes to a close, individuals and businesses need to remember some key tax provisions for making contributions to charity. The IRS offers these reminders for year-end giving: To deduct monetary donations you must have a bank record or written document from the charity stating the name of the charity, the contribution amount and the date. Contributions are deductible in the year made, even if the credit card bill isn't paid or the check isn't cashed until 2013. Only donations made to qualified organizations are tax deductible. Make sure the organization you want to donate to is qualified before making any contribution. Individuals must itemize their deductions on Form 1040 Schedule A or use a short form (Form 1040A and 1040EZ) to claim the standard deduction. Find more year-end giving tips from the IRS.

Here is info on dedicated phone lines for business victims of Sandy: 1) IRS They promote their Disaster Assistance Hotline at 1-866-562-5227 on some of their disaster recovery pages. Here’s a page dedicated to victims of Sandy. If you call the toll-free number, you’re given two options. One is specifically for questions relating to Sandy-inflicted damage. 2) Professional Licenses These are administered by NYS Dept of Education, Office of the Professions. There’s a box (in pink) at the bottom of the home page , titled “Important Information for Licensees Impacted by Hurricane Sandy”. In the last two paragraphs, two different phone numbers are mentioned to replace licenses or registration certificates.

SBA Coordinating With Our Federal Partners Federal response teams are already providing assistance to affected communities. SBA is closely coordinating with federal partners, including FEMA, to share information in the immediate aftermath of the storm. Sandy Response SBA plays an important role in disaster recovery efforts for businesses and homeowners by providing low-interest loans to rebuild and recover. If you have been affected by Sandy, please visit www.sba.gov/sandy to learn more and apply. For the latest on the government-wide response to Sandy, please visit www.usa.gov/sandy . Not affected by Sandy? You can help by sharing this update. IRS Provides Tax Relief to Victims of Hurricane Sandy Following recent disaster declarations for individual assistance issued by the Federal Emergency Management Agency, the IRS announced that affected taxpayers in Connecticut, New Jersey and New York will receive tax relief. Other locations may be added in coming days based on a

The IRS office of Federal, State and Local Governments (FSLG) will address the requirements for submitting Form 1099-G electronically in a FREE one-hour phone forum on Tuesday, September 11, 2012 at 2:00 p.m. ET. No Continuing Education [CE] credits are available for this session. This Phone Forum offers an overview of the requirements to assist you in maintaining compliance with reporting standards. You will learn how to: Comply with requirements for reporting unemployment compensation , tax refunds, taxable grants, agricultural and certain other payments Comply with electronic payee affirmative consent requirements Assist recipients in receiving their information documents electronically Following these procedures will satisfy the affirmative consent reporting requirements, save valuable time and resources, and improve customer service. You can pre-register electronically at the FSLG Phone Forum Registration site . Please register as soon as possible because sp

Presented by the Internal Revenue Service February 15, 2012, 2 p.m. EASTERN, 1 p.m. CENTRAL, Noon MOUNTAIN, 11 a.m. PACIFIC This FREE webinar is for: • Tax practitioners • Small business owners & industry organizations • Payroll professionals • Tax exempt and Government entities Learn about: Employee and Independent Contractor issues and the Voluntary Classification Settlement Program including: • Defining workers as employees and independent contractors • What to consider in determining a worker’s status • Looking at important Forms SS-8 and 8919 • How to treat corporate officers • Determining if you qualify for federal employment tax relief under Section 530 • Details about the Voluntary Classification Settlement Program Note: CPE credit is not being offered for this webinar Register & Attend: Click on the link to register for the session Information: • Visit www.IRS.gov and search Webinars for information about other events. • This event will be ar

The use of independent contractors are a flexible option for employing workers and a legitimate way to avoid some payroll tax obligations. But government authorities are on the lookout for employers who misclassify their workers, when they are really employees. Read about the the most recent government efforts to correct this type of activity, whether it was done accidentally or on purpose. However, a new government (IRS) program allows employers to reclassify their employees on a voluntary basis, drastically reducing any back taxes or penalties owed on the status change. But only if you go to them first. For more details on what steps you can take to manage this issue, see the story on correcting worker misclassification . IRS Makes Voluntary Reclassification of Workers Less Taxing

Thanks to a comment in a previous post, I've discovered that the IRS is offering transitional relief for small revoked NFP groups. As the letter writer notes, "If you can honestly say there is still a need for your non-profit, and you feel you can muster the human and other resources needed to sustain it, don't pass up this opportunity to regain your tax exempt status." Fill out a new exemption application and pay an IRS User Fee. But for organizations with annual gross receipts normally less than $50,000, the User Fee will be reduced to only $100 and reinstatement will be retroactive. The offer is only good through December 31, 2012. You can find the details here [PDF] .

The IRS has published the first Automatic Revocation of Exemption List . It indicates approximately 275,000 nonprofits whose tax-exempt status has been revoked because they failed to file a Form 990, 990-N, 990-EZ, or 990-PF for three consecutive years; the list is available for downloading in both Excel and PDF form. Here's the PDF of the New York State list . As GuideStar notes , if an organization appears on the list, it must now must file a federal income tax return and pay federal income taxes. If it previously could accept tax-deductible contributions, it no longer can do so. "If your organization is not on the list, technically you don't have to do anything. This a good time, however, to reach out to your donors, funders, and other constituents and assure them that you are in good standing with the IRS. You may also wish to suggest that your supporters consult the list to ensure that the other nonprofits they give to are still exempt."

Also, Taxpayers Impacted by Recent Tax Breaks Can File Starting in Mid- to Late February The Internal Revenue Service announced taxpayers will have until Monday, April 18 to file their 2010 tax returns and pay any tax due because Emancipation Day, a holiday observed in the District of Columbia, falls this year on Friday, April 15. By law, District of Columbia holidays impact tax deadlines in the same way that federal holidays do; therefore, all taxpayers will have three extra days to file this year. Taxpayers requesting an extension will have until Oct. 17 to file their 2010 tax returns... The IRS also reminded tax professionals preparing returns for a fee that this is the first year that they must have a Preparer Tax Identification Number (PTIN). Tax return preparers should register immediately using the new PTIN sign-up system available through www.IRS.gov/taxpros. Who Must Wait to File For most taxpayers, the 2011 tax filing season starts on schedule. However, tax law changes enact

The James J. Hill Reference Library has once again provided us with a useful resource for small businesses. The 2011 IRS Tax Calender for Small Businesses and the Self-Employed is a 12-month calender with day-to-day instructions on what needs to be done when in regards to business taxes. The "Game Plan for Success" can be printed out in calender form either month-by-month or in the traditional calender layout to remind a business owner when to do what. Each month also highlights a tax topic related to small business; for instance, “Preparation and Setting Up" for January, or “Tips on Wage Reporting” for December. In addition, the calendar also provides Tips for Business Success, a list of Forms and Publications, and a list of online resources and tools available for small businesses.

Recently I received a request that asked if there were any "federal programs for hiring the unemployed". Through the course of my research, I found three programs that might entice employers to hire new employees regardless of the current state of the economy. HIRE Act Under the Hiring Incentives to Restore Employment (HIRE) Act, enacted March 18, 2010, two new tax benefits are available to employers who hire certain previously unemployed workers. The first, referred to as the payroll tax exemption, provides employers with an exemption from the employer’s 6.2 percent share of social security tax on wages paid to qualifying employees, effective for wages paid from March 19, 2010 through December 31, 2010. In addition, for each qualified employee retained for at least 52 consecutive weeks, businesses will also be eligible for a general business tax credit, referred to as the new hire retention credit, of 6.2 percent of wages paid to the qualified employee over the 52 week per

From Guidestar : "Time is running out for small nonprofits facing loss of tax-exempt status because they have not filed Form 990-N or Form 990-EZ for three consecutive years. The deadline for the IRS's one-time filing relief program is October 15, 2010 . After that, nonprofits that (1) are required to file a 990 and (2) whose filings are at least three years in arrears will automatically lose their exemptions. To regain tax-exempt status, they will have to apply to the IRS all over again, a process that can take several months and requires payment of fees."

The Business Owner's Toolkit - Total Know-How for Small Business is a useful website that provides guides, tips, and pertinent information for small business owners. This week, I received an email about an article on Tax Tips for New Business Owners . Based on the a checklist from the IRS, the article provides information on common tax issues that all new business owners must address, including: Choice of Business Entity Tax Obligations Employer Identification Number Recordkeeping Accounting Period Accounting Method

Yesterday, CNN Money ran a story called " Auditors Crack Down on 'Independent Contractors' ," echoing a similar story that appeared in the New York Times back in February. We've written before on how the IRS differentiates when a person is an employee, or when he or she is considered to be a contractor. Check out the link in that post to an IRS document that spells out the difference between the two. Companies who utilize independent contractors are not obliged to pay unemployment insurance, or worker's comp, or Social Security taxes, or Medicare taxes . . . As these articles mention, at a time where the majority of state unemployment insurance coffers are empty, great interest in auditing companies with significant utilization of contractors has revived. Seven billion dollars is seven billion dollars, which is what the IRS is hoping to generate by conducting these reviews throughout the country. If your business is in the habit of using contractors, mak

During staff training this past week, I attended the session titled "How the American Recovery and Reinvestment Act of 2009 will Impact the Small Business Community - IRS Online Small Business Resources." While I learned useful information from Mr. Richard Torres from the IRS and Suzanne Reusch from the New York State Department of Taxation and Finance about tax breaks that are included in the Stimulus Act, I also learned about an extremely useful website for our Spanish-speaking customers. GobiernoUSA.gov "offers up-to-date official information in Spanish on government programs and services at the federal, state, and local levels." The website is the Spanish language version of USA.gov . Both are portals to "all official transactions, services, and information that the U.S. Government has to offer."