McCullough & Associates Blog

Jan 15, 2013

IRS Requirements Regarding Forms W-9 and 1099-MISC

To avoid penalties, make sure you have a Form W-9 on file for any non-employees prior to issuing them a payment. Failure to do so will be considered by the IRS as an unlawful disregard to commit a fraudulent act. This can result in the payor being subject to backup withholding tax which must be reported on Form 945, Annual Return of Withheld Federal Income Tax, and the payor is subject…

Jan 14, 2013

Important 2013 Payroll Updates

As we begin 2013 and deal with the aftermath of the Fiscal Cliff, there are a few very important payroll tax updates that need to be explained:  

  • Medicare: In 2013 taxable Medicare wages paid in excess of $200,000 are subject to an additional 0.9% Medicare tax that will only be withheld from employees' wages. Employers will not pay the extra tax.
  • Expired…

Jan 11, 2013

Automated IRS System Helps College-Bound Students With Financial Aid Application Process

College-bound students and their parents typically want to make every dollar and every minute of the college experience count including money spent on tuition and time spent on the college financial aid application process.

The Internal Revenue Service is helping minimize the time spent on the completion of the Free Application for Federal Student Aid (FAFSA) form by automating access to…

Jan 02, 2013

US Tax Code Changes that May Affect You

With the passing of the Affordable Care Act in July of 2012, a number of modifications were brought about to US tax codes. Many of these changes could potentially affect you and your business. Listed below are the most prominent changes:

  • Starting in 2014, U.S. citizens and legal residents are required to obtain minimum health care coverage for themselves and their dependents. This…

Sep 04, 2012

Form 1099-MISC

Are you required to file a 1099?  Form 1099-MISC is used to report payments to a non-employee for services rendered.  This form should only be filed when payments are made in the course of trade or business by corporations, LLCs, sole proprietors, and farmers.  One exception to this rule is rental businesses, which are not required to file a 1099.  If you have used the services of an LLC, you will…