Articles and Tax Tips

THIS MONTH'S FEATURED SUBSCRIBER ARTICLE: Identifying Payments Reportable in Box 6 of the Form 1099-MISC

Among the many "grey areas" in reporting that can trip you up are those associated with the Form 1099-MISC. Even experienced information reporters often get caught up in debates regarding whether a payment gets reported in one box or another. Today, we will look at one such trouble area; box 6 - and we will answer what should go in box 6 and not, for example, box 7.

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TAX TIP OF THE WEEK: Some Reminders for Form 1042-S Reporting

Filing season is officially upon us. As such, over the coming weeks we will be taking a closer look at the primary information reporting forms so that you do not make an otherwise avoidable mistake. Given the ongoing IRS enforcement push regarding payments made to Non-Resident Aliens let us begin with the Form 1042-S.

 

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TAX TIP OF THE WEEK: Income Code 16 and Reporting Payments Made to Non-Resident Aliens for Personal Services

One of the trickier reporting situations you will confront are those involving services payments made to Non-Resident Aliens that can be classified under Income Code 16 (independent personal services). As such, let’s take a brief look at the law and help you understand which of your service providers can be categorized as Income Code 16 payees.

 

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TAX TIP OF THE WEEK: Reporting Legal Services/Settlements When Different Names are on the Check

This filing season and for payments involving legal services/settlements, there are a number of rules you will want to keep in mind regarding the differences in reporting when different names are on the check.

 

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TAX TIP OF THE WEEK: The 28% Backup Withholding Rate and Changes Made by The New "Fiscal Cliff" Law

The American Taxpayer Relief Act of 2012 was signed into law on January 2, 2013. As many of you know the backup withholding rate was scheduled to increase from 28% to 31% on Jan. 1, 2013 if Congress did not act to keep the income tax rates at the levels they have been since 2001. So what happened to the 28% rate? Here is what you need to know...

 

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THIS MONTH'S FEATURED SUBSCRIBER ARTICLE: Two Common Substitute Form 1099 Mistakes

Though the IRS has long allowed the creation of and filing of substitute forms 1099 there are a number of problem areas that can trap the unwary filer. As such, here are two problems posed by IRS guidance that can be less than a model of clarity; and what you should do in response.

 

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TAX TIP OF THE WEEK: How Long Should you Hold on to Your Forms W-9?

Record retention is an important part of your due dilligence compliance requirements vis a vis Federal and U.S. State law. Therefore, we have a special suggestion when it comes to deciding when it is appropriate to dispose of past payee documentation.

 

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THIS MONTH'S FEATURED SUBSCRIBER ARTICLE: State Reporting Nexus Tips

Nexus is a legal term of art that describes the connection you have with a specific state, such that you are subject to those state tax reporting requirements. Determining nexus is a highly fact and circumstance dependent exercise. What follows are some of the elements you should consider in determining whether or not you have nexus with a particular state:

 

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TAX TIP OF THE WEEK: Reporting Payments Made to Incorporated Non-U.S. Legal Service Providers

Everyone knows that payments made to U.S. incorporated legal service providers are for the most part reportable on the Form 1099-MISC. However, do the Form 1099-MISC exceptions to reporting legal service providers hold true when the legal service provider is a Non-U.S. Person?

 

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TAX TIP OF THE WEEK: What to Do When Your Payee Reorganizes

You have a payee and during the year they decide to reorganize; for example from an LLC to a Corporation or even vice versa. Do you know what compliance steps you need to take in response prior to the onset of filing season? 

 

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