This Monday (April 30th) the California Supreme Court issued a ruling that will require companies generating revenue in California to reevaluate how they classify their payees; or face steep fines for non-compliance.
You have questions. Maybe it's about which box to report a Form 1099-MISC payment or whether a payment is Form 1042-S reportable. You call the IRS and can't get an answer. According to a recent report issued by the National Taxpayer Advocate this is the new normal.
With all of the new changes in W-2/1099 reporting and compliance, please be careful. For instance, another one that has slipped under the radar of many is the new backup withholding rate.
The IRS National Taxpayer Advocate released it's mid-year report to Congress. If you are in Accounts Payable or Tax it is not a pretty picture. This upcoming filing season could be the most brutal yet.
Hopefully your accounts payable department is adequately staffed and trained. That's because the "gig" or "1099" economy continues to grow - along with a myriad of compliance and reporting responsibilities.
If you are in accounts payable at a university or college one of your top compliance tasks this summer needs to be reviewing payments made to adjunt faculty. Regulators and judges are frequently finding these 1099 reportable payments to be misclassified.
If you are a mid to large sized organization then please be careful. Last week the IRS released it's data on last year's enforcement activities - and audits in relation to information reporting errors are rising.
As AP and Tax professionals hopefully know - the IRS has been on an enforcement push in regards to auditing 1042/1042-S reportable payments made to Non-U.S. payees. However, an increasing number of 1042/1042-S related audits are being expanded into the 1099 world.
After earlier rejecting a proposed settlement U.S. District Judge Vince Chhabria in San Francisco ordered Lyft's $27 million settlement for a group of 1099 reportable independent contractor drivers.
The IRS has been busy: your 1042/1042-S compliance efforts better be ready. There have already been big changes in 2017 and doublessly more to come. Let's discuss just one of these modifications which you must address.
