Posts Tagged "payroll"

Tweet shorts

Posted on May 8, 2013

* May 15 is the deadline for calendar-year nonprofit organizations to file 2012 information returns. * Taking an early withdrawal from your retirement account can cost you an extra 10% penalty tax. Get the facts first. * Withdrawals from a qualified retirement plan for certain medical expenses are not subject to the 10% penalty tax. * If your capital losses exceed your capital gains, you can deduct up to $3,000 each year against your other income. * This year medical expenses must exceed 10% of your adjusted gross income to be deductible. The rate is still 7.5% for those 65 and older. * Relief from past payroll taxes is available to certain employers who reclassify workers as employees instead of independent contractors. * The top tax scam on the IRS’s “dirty dozen” list is bogus e-mails sent by thieves trying to steal taxpayers’ financial information. * If you discover a mistake after filing your tax return, you can fix it by filing an amended return on IRS Form 1040X. * The IRS can use part or all of your tax refund to pay other federal or state debts that you owe. * If you owe overdue child support, state income tax, or student loans, the IRS may apply part or all of your tax refund to pay the debt. * If you have foreign bank, savings, or investment accounts, you may be required to file an “FBAR” report by June 28, 2013. * Credit cards should be considered a convenient way to pay, not a source of credit. Any balance due should be paid in full each month. * The Social Security Act became law in 1935, setting the official retirement age at 65. Today 13% of the U.S. population is 65 or...

Read More

Even small companies can be hit with payroll fraud

Posted on Jan 31, 2013

Unless the owner handles all aspects of computing and paying payroll, there is room for fraud in every small business. The fact that your company has only a few employees does not guarantee that you will be safe. Perhaps one of the easiest payroll fraud techniques is the overpayment of withholding or payroll taxes. Your bookkeeper simply overpays the government. When the refund check arrives, it is deposited by the employee to his or her personal account. In some cases, the employee will have an account at a different bank but in the company name. Such an account could be used for the fraudulent deposit of other company receipts as well. The greater the number of employees, the easier it is to pull off a scam. Perhaps the payroll clerk has invented a fictitious employee or falsifies hours or commissions for a cooperating employee who shares the stolen funds. Or perhaps the employee holds the payroll deposit funds in his or her own interest-bearing account until it is time to make the payroll deposit to the government. A payroll review by an independent accountant may help prevent such employee schemes. Even in small companies, it is possible to divide office tasks to make employee theft more difficult. Give us a call; we will gladly review your company’s internal controls to determine what changes may be...

Read More

Tips for cutting costs in your business

Posted on Oct 23, 2012

Keeping costs under control is crucial in today’s challenging business environment. Without a doubt, one of the quickest ways for a business to cut costs is through staff reduction. But cutting jobs is not always the best cost-cutting strategy. Drastic job cuts can lead to a vicious cycle of reduced productivity, followed by even slower growth and decreased profitability. Replacing skilled workers when times improve may be difficult, leaving your company to struggle longer still. Here are some alternative cost-control strategies that companies could consider. * Look at the cost of your office or plant. If the company owns expensive office space, consider moving to a less costly location that will not mean losing clients or business. If a move is out of the question, consider sharing office space with a compatible company. What you save in shared operating costs goes directly to the bottom line (after taxes, of course). * Consider sale-leaseback arrangements, which enable the company to generate funds for operations and transfer the burden of ownership to the buyer from whom you rent back the office space. * Review the cost of supplies and inventory. Analyze the cost of materials and supplies. Are you stocking too much material too far in advance? Can you arrange to have products shipped directly to customers by your suppliers? Periodically conduct a competitive review of suppliers, and select those who can deliver good quality and service at the lowest cost possible. Also, you may not have to pay full price; inquire about volume discounts. * Outsource some processes. Consider outsourcing certain activities that either consume a great deal of time and resources or are prone to errors. For example, you may be able to have payroll processing done by a vendor at a fraction of the current cost to you. For help in finding the best cost-control strategies for your business, give us a...

Read More

Do you owe the “nanny tax”?

Posted on Jan 25, 2011

If you had a housekeeper, nanny, gardener, or other household worker help out in 2010, you may have payroll tax obligations (commonly called the “nanny tax”). These payroll taxes apply if you paid a household worker $1,700 or more in 2010, and filing requirements must be met by January 31, 2011. For assistance, call our...

Read More

New law includes a payroll tax cut

Posted on Jan 18, 2011

There’s a new tax break this year, and you’ll want to update your budget to accommodate it. The compromise tax legislation passed in December included a payroll tax cut for 2011. * How it works when you’re an employee: Your employer will deduct less social security tax from your wages during 2011. Prior to the change, your employer was required to withhold social security tax from your paycheck at a rate of 6.2% of the first $106,800 of your wages. That rate was reduced to 4.2% for 2011, meaning your take-home pay will go up – with no impact on your eventual social security benefits and no payback required. The Medicare tax rate remains unchanged at 1.45%, which your employer will continue to deduct from your check. * How it works when you’re self-employed: You’ll pay less self-employment tax. In the past, you calculated self-employment tax using a 12.4% rate for the social security portion. For 2011, the rate you’ll use is 10.4%. Your income tax deduction – that is, the amount of self-employment tax you subtract from ordinary income – will not be affected. * How it works when you’re an employer: The reduced rate only applies to the social security tax you deduct from employee wages in 2011. To calculate your expense, you’ll continue to use the 6.2% rate for social security tax, plus Medicare tax of 1.45%, for a total of 7.65%. You have until January 31 to implement the change, and until March 31 to refund any overwithheld social security tax to...

Read More