Life Hack: Tips and Tricks to Help Small Businesses Navigate Tax Filing Season
This time of year can bring chaos, headaches and unneeded stress for employers and businesses. That's right, it's tax form filing season. Keeping track of the necessary year-end forms and staying up to date on new rules and regulations can be confusing and time-consuming. Businesses are constantly evolving, which can change how they hire employees, conduct operations or utilize outsourcing tasks traditionally handled in-house. Assuming your business has experienced one or all of these changes, you are probably asking: "Is there a form for that?" To relieve the anxiety typically associated with tax reporting, Greatland Corporation, a company that provides W-2 and 1099 forms and e-filing services to small and mid-size businesses, has compiled a list of the most frequently used forms. Currently, the rules governing the IRS penalties for failure to file information returns and furnish payee statements allows for the penalty amounts to increase every five years for inflation. Recently, legislation was passed that eliminates the "every five years" clause and instead, allows for a potential increase every year based on cost-of-living. What does this change mean for you? The IRS is cracking down on non-compliance of wage and information reporting, which makes it even more important for businesses to find a compliant solution. Although penalties may not increase every year, they now have the potential to do so if the cost of living increases. According to the experts at Greatland, there are more than 20 year-end reporting forms a taxpayer could potentially receive but to save time companies already don't have, listed below are more common forms used by small businesses:
There are a variety of forms 1099 that account for other sources of income. Issuers must mail out these forms to recipients by February 2 this year. However, 1099 forms do not have to be issued to the IRS until February 28, allowing businesses to catch potential mistakes and correct them. This is also true for W-2s, although they are issued to the Social Security Administration rather than the IRS. The most often used 1099 forms are listed below:
One of the most important topics in tax reporting this year is Taxpayer Identification Number (TIN) matching. TIN matching was introduced by the IRS to increase compliance and reduce costs associated with sending notices and additional processing. Costly penalties can occur if TINs are filed late, filed in an incorrect format, filed with missing or incorrect information, or filed on an incorrect media. The maximum penalty for businesses for furnishing an incorrect TIN to the IRS is $500,000. As an added benefit to users, Greatland provides an automated TIN matching service, alleviating any worry or potential fine associated with non-compliance.
Source: Greatland Corporation |
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