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Where e-filing information return forms comes full circle. We support 1099, 1098, W-2, and Affordable Care Act forms.

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Help! It’s Tax Season and I Need An Accountant

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If you’re a small business that doesn’t have an accountant lined up for tax season, you have a few options. In this article, we’ll discuss how different finance professionals can help you during tax season as well as your options for filing your own business taxes. Option 1: Find a certified tax professional ASAP. There are two primary types of tax professionals you can seek out to complete your business taxes: Enrolled agents – These tax pros are certified by the IRS Certified Public Accountants (CPAs) – These tax pros are licensed by state boards of accountancy When it comes to choosing a tax professional between these two options, it depends on your other needs. If you just need a tax professional during tax season or if you are facing advanced tax issues, you will want to find an enrolled agent. If you want someone to provide guidance on financial matters throughout the year, you will want to hire a CPA.  If you received aid from the CARES Act, then your taxes will be more complicated for the next couple of years, including this year. To work through additional tax compliance details, it’s best to hire a certified tax professional.  Option 2: Hire an accountant or bookkeeper ASAP. If you cannot find a certified tax professional, you have a few more options: Accountants Bookkeepers Unenrolled preparers While not certified tax professionals, accountants and bookkeepers can help you manage your finances and may be able to provide you with guidance for filing your taxes. While searching for someone to help you with your taxes, you may also come across tax preparers who are not enrolled agents. These unenrolled preparers may have legitimate businesses, be very knowledgeable, and may have worked as tax preparers for many years. However, it’s best to proceed with caution if you choose to use an unenrolled preparer because they can prepare your taxes, but they cannot represent you before the IRS if you face tax …

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ACA Penalties & Deadlines for Tax Year 2020

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The IRS issues penalties for employers who do not comply with the Affordable Care Act (ACA) Employer Mandate. For the 2020 tax year, the penalties have increased. What are the ACA penalties? Monetary penalties for filing late If you file ACA forms to the IRS after the deadline, you will be charged a minimum of $50 per return. At maximum, you may be charged $550 per return filed late. The amount increases by the number of returns not filed and the length of time it takes you to file them after the deadline. According to ACA Times, if you file late for tax year 2020, you can expect to pay the following penalty amounts: $50 per return filed late if you file within 30 days of the deadline; the penalty amount will not exceed the annual maximum, $556,500 $110 per return filed late if you file 31 or more days late, but before August 1, 2021; the penalty amount will not exceed the annual maximum, $1,669,500 $270 per return filed late when filed after August 1, 2021; the penalty amount will not exceed the annual maximum, $3,339,000 $550 per return if the IRS believes that you are intentionally disregarding this mandate; the penalty amount for this has no annual maximum  However, if your gross receipts for the past three years are $5 million or less, you would be charged the same penalty amounts with lower annual maximums.  Penalties for failing to comply with the ACA Employer Mandate According to Freeman Law, there are two types of penalties for employers who disregard the ACA Employer Mandate: A. When an applicable large employer (ALE): Does not offer coverage Offers coverage to less than 95% of its full-time employees and their dependents Has at least one full-time employee who receives a premium tax credit to help pay for coverage through a Marketplace Exchange B. When an ALE offers coverage to at least 95% of its full-time employees and their dependents, but at least one full-time employee receives a premium tax credit to …

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2021 Deadline for Forms 1099-MISC and 1099-NEC

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Tax season is around the corner, so it’s time to start gathering information and preparing for the deadlines. What is the 2021 deadline for filing 1099s? The 2021 deadline for Forms 1099-MISC and 1099-NEC is Monday, February 1 since the typical deadline date, January 31, lands on a Sunday. The deadline for Form W-2 is also February 1, 2021. According to CPA Practice Advisor: A 2015 law made it a permanent requirement that employers file copies of their Form W-2, Wage and Tax Statements, and Form W-3, Transmittal of Wage and Tax Statements, with the Social Security Administration by Jan. 31. That is also the date the Forms W-2 are due to workers. This includes Form 1099-NEC and 1099-MISC as it relates to independent contractors and related nonemployees. However, now that nonemployee compensation has been separated from Form 1099-MISC onto Form 1099-NEC, the deadline to e-file Form 1099-MISC is March 31, 2021. What does this mean for your business? Business owners need to file 1099s to the IRS and send pay statements to freelancers, contractors, and other miscellaneous earners by the deadline. This means you will want to start gathering the following information for the independent contractors who have worked for you in 2020: Full name Address Social Security Number or Individual Taxpayer Identification Number Learn more about the latest instructions for Forms 1099-MISC and 1099-NEC from the IRS here. Start your e-filing process with eFile360 E-filing is the quickest and safest way to submit forms, so e-file with eFile360. Create a free account today.  Be sure to utilize our TIN Checking service, which helps you know if you are reporting accurate tax IDs and names. Learn more about our TIN Checking service here. …

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5 Common 1098 Questions

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1098s are another subset of forms, much like 1099s, that have small but crucial differences between the different form types. As we approach the end of 2020, tax season will seem closer than ever after the strange circumstances this year brought around for businesses and tax filing. Here are some answers to 5 common 1098 form and filing questions. What is the deadline for filing 1098s? Copy A of the 1098 deadline for filing on paper with the IRS is February 28. If you are filing electronically, the due date is the end of March. Copy B must be provided to the borrower by the end of January. What happens if there are errors on my 1098? The most common errors associated with 1098 filing are: filing the wrong form type, reporting the wrong amount, reporting the wrong TIN or not including one at all, using the wrong year/version of the form, and not using the correct IRS form (you cannot download or copy). If you make an error that you are unable to fix, the best thing to do is contact an accountant or tax professional for help. Once you have the updated information, you need to file a correction for each form that had errors. What are the different types of 1098s and what are they used for? The primary function of 1098 forms is to report payments and contributions you made that have the potential to be deducted from your taxable income. There are seven different 1098 forms: 1098 (mortgage interest statement), 1098-C (contributions of motor vehicles, boats, and airplanes), 1098-E (student loan interest statement), 1098-F (fines, penalties, and other amounts), 1098-MA (mortgage assistance payments), 1098-Q (qualifying longevity annuity contract information), and 1098-T (tuition statement). For a bit more on these forms and what they are used for, take a look at our other blog post. What’s the most common 1098 form? The most common 1098 form is, incidentally, the 1098 itself without any dashes or letters following it. This form is used to report …

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6 Common 1099 Questions

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As the trend towards freelance work continues to grow, more and more people will have to file form 1099, specifically 1099-NEC. Tax filing season will be here before you know it, and we wanted to share 6 common 1099 questions that businesses and individuals alike are asking. What is the deadline for filing 1099s? The deadline for filing 1099s with the IRS and for sending them to the independent contractor recipient is January 31 every year. However, for tax year 2020, the deadline is February 1, because January 31 falls on a Sunday. What happens if there are errors on my 1099? The most common errors associated with 1099 filing are: filing the wrong form type, reporting the wrong amount, reporting the wrong TIN or not including one at all, using the wrong year/version of the form, and not using the correct IRS form (you cannot download or copy). We’ve shared some tips here on how to fix your errors and file a correction. What are the different types of 1099s and what are they used for? There are 18 different 1099 forms: 1099-A, 1099-B, 1099-C, 1099-CAP, 1099-DIV, 1099-G, 1099-H, 1099-INT, 1099-K, 1099-LTC, 1099-MISC, 1099-NEC, 1099-OID, 1099-PATR, 1099-Q, 1099-R, 1099-SA, and 1099-SB. 1099-NEC and 1099-MISC are two of the most common 1099s. For more information on what the other 1099 forms are used for, check out our blog post on that topic. What’s the difference between 1099-NEC and 1099-MISC? The 1099-MISC is for reporting miscellaneous payments made to independent contractors for things like rent, fishing boat proceeds, royalties, substitute payments, medical/healthcare payments, crop insurance proceeds, gross proceeds paid to a lawyer, and any excess golden parachute payments. It was previously used to report non-employee compensation and wages. Non-employee compensation reporting is now done on the renewed 1099-NEC form – this was reintroduced to separate non-employee expenses and prevent common reporting mistakes. You’ll use a 1099-NEC to …

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What Forms Are Eligible for the CF/SF Program?

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The new form 1099-NEC is one of the forms not able to be filed through the CF/SF program. The Combined Federal and State Filing program “forwards original and corrected information returns filed electronically through the FIRE (Filing Information Returns Electronically) System to participating states free of charge for approved filers, eliminating separate reporting to the participating states,” per the IRS. Participating States Many, but not all, states participate in the CF/SF program. Some states don’t have a state income tax, and therefore would have no need to have federal income tax forms forwarded to the states. States that do not have a state income tax include Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming. Those states that participate in the CF/SF program include Iowa, Illinois, Kentucky, New York, Oregon, Pennsylvania, Rhode Island, Utah, Virginia, West Virginia, Vermont, District of Columbia. Those states that do not participate in the CF/SF program include Alabama, Arkansas, Arizona, California, Colorado, Connecticut, Delaware, Georgia, Hawaii, Idaho, Indiana, Kansas, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Missouri, Montana, Nebraska, New Jersey, New Mexico, North Carolina, North Dakota, Ohio, Oklahoma, South Carolina, Wisconsin. Eligible Forms If you are in a participating state, here are the forms that efile360 can help you with, most are eligible for the CF/SF program. Please note: 1099-MISC is on the list but, as of now, the new 1099-NEC form for reporting non-employee compensation is not among the eligible documents. Form 1099-B - Proceeds from Broker and Barter Exchange Transactions Form 1099-DIV - Dividends and Distributions Form 1099-G - Certain Government Payments Form 1099-INT - Interest Income Form 1099-K - Payment Card and Third Party Network Transactions Form 1099-MISC - Miscellaneous Income Form 1099-OID - Original Issue Discount Form …

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